'Dr. Doom' economist Nouriel Roubini blasts get-rich-quick schemes - and says it's obvious that current market mania 'will end in tears'
- Nouriel Roubini - popularly known as "Dr. Doom" - said it's obvious that current market-mania "will end in tears."
- A whole cohort of people are being duped in the name of "financial democratization," he warned.
- According to him, many are convinced that financial success lies in get-rich-quick schemes, or "worthless assets" like crypto.
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Nouriel Roubini, the economist nicknamed "Dr. Doom" for his pessimistic predictions, warned against get-rich-quick schemes in a scathing op-ed published this week.
Dangers of rising income and wealth inequality mean the bottom 50% of people that make up wealth distribution hold less than 1% of total equity assets , he said, citing a CNBC report. The top 10%, meanwhile, command about 88%, and the top 1% hold 51.8%.
"With equity markets reaching new heights at a time of rising income and wealth inequality, it should be obvious that today's market mania will end in tears, reproducing the economic injustices of the 2008 crash," Roubini said.
Millions of people ended up losing their jobs, homes, and savings during the 2008 financial crisis that led to the bursting of the US housing bubble. And now, Roubini says economic stresses for the same cohort are intensifying yet again in the form of what he says are investing traps like trading app Robinhood.
"Workers who rely on gig, part-time, or freelance 'employment' are being offered a new rope with which to hang themselves in the name of 'financial democratization,'" he said. "Millions have opened accounts on Robinhood and other investment apps, where they can leverage their scant savings and incomes several times over to speculate on worthless stocks."
The GameStop saga that saw a bunch of retail investors rebel against short-sellers shadows how a class of "hopeless, jobless, skill-less, debt-burdened individuals" are being exploited once again, he said.
"Many have been convinced that financial success lies not in good jobs, hard work, and patient saving and investment, but in get-rich-quick-schemes and wagers on inherently worthless assets like cryptocurrencies (or "shitcoins," as I prefer to call them)," Roubini wrote.
He has previously said that the Flintsones had a better monetary system than bitcoin and that it shouldn't be considered a real asset.
The army of millennial Davids attempting to take down a Wall Street Goliath is just another scheme that will ruin clueless amateur investors and culminate in a repeat asset bubble reminiscent of 2008, he said.Read the original article on Business Insider