Economist Nouriel Roubini, who correctly predicted the 2008 financial crisis, believes the US is heading towards a deep recession and said those claiming the downturn will be mild are “delusional.”

“There are many reasons why we are going to have a severe recession and a severe debt and financial crisis,” Roubini said on Bloomberg TV Monday. “The idea that this is going to be short and shallow is totally delusional.” 

Instead, he’s forecast a deep, impactful recession as a result of rising interest rates and high debt ratios in the wake of the COVID-19 pandemic.

Unlike the 1970s recession when the debt ratio was low despite “stagflation” — a combination of stagnant growth and high inflation — the national debt has skyrocketed since 2008 and was subsequently followed by a period of low inflation due to a credit crunch and sudden demand shock, he said.

“This time, we have stagflationary negative aggregate supply shocks and debt ratios that are historically high,” said Roubini. “In previous recessions, like the last two, we had massive monetary and fiscal easing. This time around we are going into a recession by tightening monetary policy. We have no fiscal space.”

Roubini is the CEO of Roubini Macro Associates and has earned the nickname Dr. Doom for his bleak predictions.