Economist Nouriel Roubini said that while the overall global economy appears to be in healthy shape, the United States continues to face a variety of threats.
The chairman of Roubini Global Economics cited such dangers as potential U.S. protectionism, uncertain Chinese growth and Federal Reserve policy at the Institute of International Finance annual conference in Washington.
He said current conditions are a good set up for emerging markets. Globally, interest rates are low because of still accommodative central bank policy and a global savings glut, as well as low global investment, MarketWatch reported.
Roubini predicts that the biggest concern for America remains protectionism.
“There’s rising risks that Nafta is on a collision course,” he said. “Cooler minds should realize you can posture but that’s not something sensible to do,” he said.
The biggest risk in 2018 will be posed by the Trump administration, MarketWatch reported that he said. Roubini also cautioned that “excessive” U.S. tax cuts could cause the dollar to strengthen and the Federal Reserve to have to hike rates more aggressively, MarketWatch explained.
Roubini said there’s also a risk of a surge of inflation. “It’s not my baseline, but what if we’re really close to full employment and rising wages, then the Fed would be behind the curve.”
For his part, President Donald Trump is continuing to publicly comment on Twitter about the recent bull stock market.
He has recently touted gains the overall market has made, "record business enthusiasm:
"The U.S. has gained more than 5.2 trillion dollars in Stock Market Value since Election Day! Also, record business enthusiasm," he tweeted Monday.
"Health Insurance stocks, which have gone through the roof during the ObamaCare years, plunged yesterday after I ended their Dems windfall!" Trump tweeted early Saturday.
And Friday he touted a CNBC story claiming: "Consumer confidence soars to highest level since 2004."
Major Wall Street indexes hit fresh records at the open on Monday on gains in financial and technology stocks even as investors awaited a barrage of earnings reports this week, Reuters reported.
“The market still wants to be optimistic, it wants to continue to move higher from here,” said Robert Pavlik, chief market strategist at Boston Private Wealth.
“It seems to be the trend recently that companies report good earnings and the market sells them off a little bit, taking it as an opportunity to lock in profits. But it’s not something that should worry long term investors.”
(Newsmax wires services contributed to this report).
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