Although bearish for the U.S. economy, Nourel Roubini can’t get enough of Latin America. To wit, he recently upgraded his growth outlook for Latin America in 2010 from 3.3 to 3.8.
The economist explained this upgrade in an interview with the Americas Society:
AS: What is behind this increasingly positive outlook for Latin America?
Roubini: There are two things. One is that global economic and financial conditions are improving. There is a recovery of growth even if it’s going to be anemic. Commodity prices have been rising. Financial conditions remain easy. Capital is flowing back to emerging markets. So that is the global outlook.
And two, these countries have shown their own resilience. Their economic policies have been sound and they’ve been able to conduct countercyclical policies. They’ve not experienced a financial crisis in these episodes. Their overall fundamentals are sound, so the combination of maintaining sound fundamentals and right economic policies with improvement in the global economic outlook implies a recovery.
The key word in Roubini’s answer is “anemic.” Even anemic global recovery will continue to feed stable emerging economies; whereas it will fail to sustain developed economies like the U.S.
Read the full interview here.