Nouriel Roubini: ‘World War III has already started’

NYU Stern's Nouriel Roubini speaks at the 2022 Yahoo Finance All Markets Summit on China-U.S. tensions and geopolitics.

Video Transcript

NOURIEL ROUBINI: It's a very serious issue. I believe that we are already for sure in a Cold War. And we'll have a decoupling between US and China, trade in goods and services, in the movement of labor, of capital, investments, but more importantly right now, everything is important is to do with technology, data, and information that is from a national security point of view, severe and important. So that decoupling is occurring. The Cold War between US and China in terms of overall political and geopolitical relations is becoming worse.

And the reason why Xi Jinping right now is seeking a third term and possibly a fourth, is not because he wants to pass through history as the man who reformed China, is because he wants to pass through history as the man that united mainland with Taiwan. So I believe the next five to 10 years is going to be the time where there's going to be a confrontation between US and China on the issue of Taiwan. And that could be a trigger of this Cold War becoming a hot war.

We don't know whether it's going to happen, how it's going to be resolved, but that's where we get to World War III among other things. But in some sense, World War III has already started. It started in Ukraine, because this conflict has broader implications that are going well beyond Russia and Ukraine. It's the beginning of something else.

ANDY SERWER: You didn't mention climate change, so I'm assuming you're not worried about that.

NOURIEL ROUBINI: Well, there is a full chapter about an uninhabitable planet, about climate change. And it's a long discussion. But the reality is, there's a lot of talk about doing something about climate change. There's a lot of talk about ESG investment, environmental, social, and governance, and so on. But the reality is a lot of it is greenwashing, a lot of it is green wishing, a lot of it is green fig leaves, or people will say we're going to do something. Government, firms, individual, they're doing nothing. Glasgow and COP was a total failure.

At the current level, we're headed towards an increase of temperature by the end of the century of three degrees. Even two will be a disaster. Three means that half of the world will be in places that are either underwater or too hot to live. And if you worry about a few hundred thousand migrants from Central America moving here, wait until there will be not a few hundred thousand, but millions or billions of people who have to move from places you cannot live to other parts of the world. That's going to be an economic and financial disaster.