'Dr. Doom' sees parallels to 1914 in Asia

Nouriel Roubini is struck by comparisons to 100 years ago when World War I broke out.

By MSN Money Partner Jan 23, 2014 5:44PM
Credit: Pete Marovich/Bloomberg via Getty Images

Caption: © Nouriel Roubini, co-founder and chairman of Roubini Global Economics LLCBy Kiran Moodley, CNBC

With many parts of the world gearing up to commemorate the 100th anniversary of the start of the first world war, Nouriel Roubini (pictured) has solidified his hold on the title "Dr. Doom" by suggesting parallels between 2014 and 1914.


There may be no Austro-Hungarian empire or Archduke Franz Ferdinand, but Roubini tweeted this from the World Economic Forum (WEF) in Davos Thursday:

"Many speakers compare 2014 to 1914 when WWI broke out & no one expected it. A black swan in the form of a war between China & Japan?"

He then tweeted some of the reasoning behind this train of thought.

"Echoes of 1914: backlash against globalization, gilded age of inequality, rising geopolitical tensions, ignoring tail risks"

While Roubini is renowned for his bubble warnings and doom scenarios, his concerns weren't drawn out of thin air, but rather taken mainly from the lips of Japanese Prime Minister Shinzo Abe.


According to reports from both The Financial Times and BBC, Abe said on Wednesday that China and Japan were in a "similar situation" to that of Britain and Germany ahead of World War I.


However, Reuters reported that Abe's top spokesman denied the Japanese leader meant war was possible or imminent, which is unthinkable for many.


Still, Abe said that China's increase in military spending was a source of instability in the region and he reiterated his calls for a military hotline to avert a conflict. In November, China tried to impose an air defense zone over a small collection of islands in the East China Sea, which the Japanese call the Senkaku Islands while the Chinese refer to them as Diaoyu.


Abe himself is a hawk. Back in December, he visited the controversial Yasukuni Shrine, which honors Japan's wartime dead, including those who committed atrocities during the country's march across Asia during the World War II.


There are other areas of concern in the rest of the world for those seemingly keen to compare 2014 to 1914: the ongoing Syrian civil war and its ramifications for the Middle East, as well as the future of Iran's place in the international community.


Furthermore, the current protests in Kiev and Ukraine's pro-EU or pro-Russia dilemma raise questions over the rising power of Russia and how Western powers deal with this.


Yet Roubini also mentioned the twin problems of a "backlash against globalization" and a "gilded age of inequality." The latter has been a watchword at Davos this year and has become the key focus of President Barack Obama's final term in office. In a speech to a think-tank in Washington D.C. last month, Obama described it as the "defining issue of our time."


Perhaps 1914 isn't a good comparison, but rather 1848 and 1968 could be: the former a year of revolutions across Europe; the latter a year of socialist, communist and student protests in the U.S., U.K., France, Germany, Italy and the USSR. Will 2014 be the year when there is a growing backlash against the prevailing status quo and rising income inequalities?


Of course, it is worth noting that the written history of World War I has come under much scrutiny in recent months, as politicians and historians debate over revisionist theories and nationalistic fervor.


As Joseph Nye, a former U.S. assistant secretary of defense, has written: "Among the lessons to be learned from the events of 1914 is to be wary of analysts wielding historical analogies, particularly if they have a whiff of inevitability.


"War is never inevitable, though the belief that it is can become one of its causes."


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120Comments
Jan 23, 2014 10:07PM
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I love it. People keep fighting and dying over who will control what part of the planet and in the end the world turns with or with out them. Usually without them, and their blood and flesh just helps to fertilize and nourish the earth they keep trying to control. Fools.
Jan 23, 2014 9:42PM
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So far, this current cycle Parallels two periods in time. The Dot-Com Boom and Bust plus the events that led up to the Great Recession. This time around we have both Japan and China to help dig a far deeper hole. The Global FEDS are already toast so it will literally take a miracle to fix the next massive Downturn.

We never solved the problem of $500-700Trillion in Scam Banking Derivatives plus we now have the FEDS sitting on over $4Trillion in Fake Money. Most Corporations have likely bought their own Stocks at Highs instead of investing in Workers and equipment. In the end, because of GREED, this current Form of Phony Capitalism will destroy everything it has created.

Jan 23, 2014 8:40PM
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Well, which side would the US be on?  If we side with Japan then we won't have to back all of those securities that China owns.
Jan 23, 2014 8:34PM
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And who has been president during the "gilded age of inequality"?  Capitalism is the only economy that creates jobs and distributes wealth with fairness and justice because the winners and losers are determined by a neutral free market instead of greedy, selfish politicians.
Jan 23, 2014 9:35PM
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Barry says the economy is doing well.  We should all believe him.  The emperor has nice clothes!
Jan 23, 2014 10:29PM
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If you can draw one parallel both Woodrow Wilson and BHO are the only Phd's to hold the office. Both are graduates from Princeton,anti constitution and pro big government. 
Jan 23, 2014 11:21PM
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History is written by the victors. In this way the past is nothing but the spoils of endless war.
Jan 23, 2014 9:27PM
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This article lacks any logical thought, things are a little different today. Japan is our ally and falls under what is known as the NATO Nuclear Umbrella. China has nuclear weapons and Japan does not, any attack on Japan would force the United States into a nuclear response and China would become a glass parking lot in about 30 minutes. One Ohio class submarine could wipe out China's ability to wage war, just blowing up China's massive dams would kill 1/3rd of their population, Any thing is possible, but this dooms day scenario is highly unlikely and only conspiracy nuts will embrace it.
Jan 24, 2014 11:21AM
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This one for you Dr Doom    Stock quote of the Day     Son says to Father   Dad I am considering a career in Organized Crime !

 

Dad says  Government or Private Sector ??    DIE BANK OF AMERICA DIE  !

Jan 23, 2014 9:26PM
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The United States spends more on Defense than the Next Top Ten Countries combined, but the Idiot from Japan is complaining about China's spending on Defense.

Jan 23, 2014 9:33PM
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China and Russia are allies. Many of our so called Allies would love to see us go Under. Japan is broke so they are using America for their Defense needs. So any thing coming out of Japan hardly means they are our Allies. Between China and Russia, any attempt to engage in a World War III type event would End Global Civilization as we know it.
Jan 24, 2014 3:05AM
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Dont stop making your mortgage payment. All this doom and gloom was in the media in the 70's as well, and that includes claims by kooks that an "ice age" was coming. The attention whores of the media world are just acting overly dramatic right now, because negative, scary stories sell.
Jan 24, 2014 11:29AM
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Man learns nothing from history and is only driven by greed and the need to control. FOOLS
Jan 23, 2014 10:05PM
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I beg to differ with Dr. Doom...Franz Ferdinand is still going strong; They just released a record last Summer.

Oh, wait. I got confused.

Jan 24, 2014 1:21AM
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History always repeats itself, mankind cannot grasp the past, let lead himself beyond physical realms of mutual self destruction.
Jan 24, 2014 1:54AM
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I guess I would ask Roubini how he connects or views such other strife as Sudan, Iraq/US. Afghan/US, Iran/US, N.Korea/US, Russia/ with many of her neighbors, Syria; And Israel against everything Middle Eastern....And then all the instability in the N. African Nations..


Guess we just chuck that off to "Geopolitical Tensions."

Jan 24, 2014 1:59AM
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The looming economic crisis will open the flood gates for civil unrest the world over. (NO JOBS) This will give the reason for the "NWO" to be launched into it's critical stage. "MARTIAL LAW" Everything is being put into place with break neck speed. (HOMELAND SECURITY)  No one is so much has making a move to avert it. (PROTESTING)  It will be to late for most all of us. If you have not made preparations.  You will have a FEMA Camp address. (SHEEP) Those who try to rise against the new KINGS of the world will be dealt with swiftly. (GENOCIDE) Those who flee to the hills will be going into a every man for himself scenario. (ANARCHY)  Money will be the least of any ones problems. Food, Shelter, Water, and a sense of rule of REAL LAW or MORALS will be gone.  (The REAL AMERICAN DREAM)  Who is to blame? (ALL OF US) 
Jan 24, 2014 10:53AM
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When it rains it pours. Still can't get over the China B/S so let's ruin stocks again for a second day! As I said yesterday, "Monkey See, Monkey Do". What Asia does and Europe will follow the USA will follow too!!!!  So what's the solution to the problem????
Jan 23, 2014 9:30PM
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A total Naive posters states, "Capitalism is the only economy that creates jobs and distributes wealth with fairness and justice because the winners and losers are determined by a neutral free market instead of greedy, selfish politicians."

That has never been true as Winners and losers are determined many times by Bought and Paid for Greedy, Selfish Politicians. The Wage Gap has moved from 40 to 1 to well over 400 to 1 as Global Poverty and Pollution is at Record Levels. But some idiots want you believe that Capitalism is Working.
Jan 24, 2014 12:12PM
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"""To say nobody can predict the future is to put your limitations onto others. I can't predict the future but I can't say the same about everyone"""

 

I disagree.  I think that anybody, and you, can predict the future.  If you light a match and hold the flame under your newspaper, you're probably safe in predicting the result.  When you see someone speeding down a snowy highway toward a red light, you're probably safe in predicting what's going to happen.  If you see rusty tank of hazardous chemicals near a river, you're proabably safe in predicting what's going to happen.  If you see rising income inequality.... 

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