Slack Credit Markets Weigh on Economy: Rogoff

The risks of a second leg down for the economy is small but the economy, especially the housing sector, still has a long way to go before it reaches recovery, Harvard Professor Kenneth Rogoff told CNBC Wednesday.

"I'm a lot more optimistic than I was nine months ago… I think the risks of a double-dip in the near term are low," Rogoff told "Squawk Box."

However, there is an overhang of debts, the credit markets "are slack" and unemployment is still bad, he added.

"I think, and I'm being sarcastic now, the only good thing that happened lately is Copenhagen failed," Rogoff joked, explaining that the economy will grow faster without the tough targets to reduce carbon emissions.

The danger is that "we may be dying of pollution," he added.

"Housing, I don't think we've seen bottom yet," Rogoff said, echoing the views of John Geanakoplos, a partner at Ellington Capital Management, who said earlier that the full effect of the housing crisis has not yet been felt because foreclosures are not happening fast enough.

"We might have job growth by the spring," Rogoff said, but added that "a lot of small businesses have a lot of good reasons to be cautious about hiring."