US heading towards 'stagflationary debt crisis', market may crash 50%: Nouriel Roubini

The world's major economies including the United States are heading towards a "stagflationary debt crisis", which may lead to the equity market crashing by around 50 percent, warned economist Nouriel Roubini, who is known as 'Dr Doom' for his forecast of the 2008 global recession.

The recession into which the US is likely to be plunged is worse than the previous financial crises, as the country's economy is currently showing symptoms akin to the stagflation crisis of the 1970s as well as the crippling recession which was seen in 2008, Roubini argued, in his column for the Project Syndicate.

While the US and global equities slide by around 35 percent in "plain-vanilla recessions", the drop would be more severe in the upcoming financial crisis due to the combined effect of soaring inflation and debt crisis, Roubini claimed.

"Because the next recession will be both stagflationary and accompanied by a financial crisis, the crash in equity markets could be closer to 50 percent," 'Dr Doom' wrote.