Nouriel Roubini Talks Tech Led Boom, Geopolitics
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What is the main topic discussed in this episode?
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Bloomberg Audio Studios. Podcasts. Radio. News. So here's the latest this morning. U.S. productivity accelerating at its fastest pace in two years, fueling hopes for further AI-driven gains. Nouriel Roubini is the chairman of Roubini Macro Associates, and he writes the following. The U.S. remains at the center of a technology-driven positive supply shock that raises growth and lowers inflation over time. Nouriel joins us now for more. Nouriel, good morning. Good to see you. Great seeing you. Fantastic to catch up with you, sir. You're bullish, not just for the year ahead, but through to 2030. Can you flesh that out for us a little bit more?
Yes, I mean, everybody's talking about AI, Gen AI, but this is only one of the 15 technologies of the future. They're all related to AI, but it's AI, semiconductor, biomedical research, quantum fusion, defense tech, fintech, new material science, you name it. And it's a race between U.S. and China. I don't think it's a zero-sum game. U.S. is going to do well. China is going to do well. But my estimate is that the U.S. potential growth is estimated today to be only 1.8%. Could be as high as 4% by the end of the decade. And I've done a bit of a bottom-up analysis. And by the way, the data on productivity, after the GFC, average productivity between 2009 and 2019 was only 1%. Since 2019, in spite of the dip during COVID, has doubled to almost 2%, 1.9%.
In 2024, it was 2.4%. And the number from Q3 suggests it was almost 5%. And by the way, the Atlanta Fed no-cast for Q4 GDP as today is 5.1%. Probably it's too high. But given that and given the job number, you'll have another high productivity growth. Now, I don't think the productivity growth is 4% or 5%, but there is definitely acceleration. Jobs is key. Is it jobless growth? jobless growth? Yeah. Well, it's a jobless growth. There are three stories. One is that the GDP numbers are wrong and the GDP numbers are going to be revised towards the weaker labor numbers. The other one is that, no, the GDP growth is strong and you're going to have some adjustment upward of the revised data. I think the third explanation is the more correct one.
You can have strong GDP growth and having weak labor growth because we're having a productivity revolution. If you're looking, for example, at the revenue, real revenue per worker of S&P 500 firms since the launch of ChatGPT in November 2022, the average has increased for S&P 500 firms by 15% in the last three years. So it's almost 5% per year. And if you look at it by sector, of course, a lot of it is closer to 20% in tech and communication services, but it's very large also across the board. So both at the micro data level, S&P 500 firms and the macro number, we're seeing a productivity revolution already in the numbers.
I'm kind of dealing with whiplash right now because we just had the Ryan Mattel CEO on, defense sector in Europe booming for all the wrong reasons. This idea that he's more worried about the state of the world than ever before and here Dr. Doom is coming on to tell us about how productivity boom is gonna bring everything to a better place.
What is Nouriel Roubini's bullish outlook on AI's impact on the economy?
Why are you less concerned about this overlay of rearmament and militarization that is also coming in tandem with this productivity boom?
Well, there are geopolitical risks in the world, and I'm aware of them. The question is whether they're going to have a significant economic and market effect. Look at the biggest one. You had a 12-day war between Israel and Iran last June. Oil prices went up a little bit.
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Chapters
4 chapters
1
What is the main topic discussed in this episode?
0:00–3:40
2
What is Nouriel Roubini's bullish outlook on AI's impact on the economy?
3:40–4:05
3
What technologies are driving the productivity boom alongside AI?
4:05–5:21
4
How does Roubini assess the U.S. and China's competitive landscape in tech?
5:21–8:36
Speakers
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