The next global recession will be immune to monetary solutions | Nouriel Roubini

Unlike in 2008, we now face the consequences of three potential negative supply shocks

There are three negative supply shocks that could trigger a global recession by 2020. All of them reflect political factors affecting international relations, two involve China, and the United States is at the centre of each. Moreover, none of them is amenable to the traditional tools of countercyclical macroeconomic policy.

The first potential shock stems from the Sino-American trade and currency war, which escalated this month when Donald Trump's administration threatened additional tariffs on Chinese exports, and formally labelled China a currency manipulator.

It is easy to imagine how today's situation could lead to a full-scale implosion of the open global trading system