Nouriel Roubini on the Biggest Risks That Lie Ahead

For years, investors have relied on the classic 60/40 portfolio of stocks and bonds. The idea behind this was simple: bonds tend to go up when stocks go down, so the two things should act as a natural hedge. But when inflation spiked in 2022 and 2023, the 60/40 portfolio performed terribly and bonds failed to act as a safety cushion. In this episode, we speak with Nouriel Roubini, chief economist and portfolio manager of the new Atlas America Fund, an ETF that is trying to create a new type of safe asset that can withstand big risks, including stagflation, deficits, and de-dollarization. We also talk about the outlook for the US economy in 2025, and the big risks that the chairman and CEO of Roubini Macro Associates sees on the horizon. This transcript has been lightly edited for clarity.

Key insights from the pod:
Two ways to think about potential policy under Trump — 2:58
What’s going on with inflation? — 7:24
De-dollarization and its discontents — 11:29
Tariffs and how they affect inflation — 18:58
Two major constraints of going fully stagflationary — 22:30
Nouriel’s framework for a new safe asset and dealing with risk — 24:45
The benefits of tokenizing an ETF — 38:21