Economist Nouriel Roubini, renowned for his foretelling of the housing bust and financial crisis, has revealed the key flashpoints that are keeping him up at night, which he believes could hit "rationally complacent" financial markets.
In an opinion piece on the Project Syndicate website, published late Tuesday, he said that an "obvious paradox" had occurred with oil prices ticking lower and equity traders remaining bullish despite a series of geopolitical risks that have flared up in 2014.
"A century ago, financial markets priced in a very low probability that a major conflict would occur, blissfully ignoring the risks that led to the first world war until late in the summer of 1914," he said.
"Back then, markets were poor at correctly pricing low-probability, high-impact tail risks. They still are."