Expect a 'Long and Ugly" Recession, Says Expert Who Predicted 2008 Financial Crisis

Talk about a dire warning.

The tricky thing about economic downturns is that they can sometimes be difficult to predict. But the last major financial crisis to hit the U.S. (outside of the events of 2020, which were clearly pandemic-driven) was something one expert did predict. 

Economic expert Nouriel Roubini was spot-on when he said the U.S. would endure a major financial crisis back in 2008. And now, he's issuing a dire warning about an upcoming recession that could hit as soon as late 2022 or early 2023.

Worse yet, Nouriel Roubini says we shouldn't expect our next downturn to be short-lived. Rather, he says, Americans should expect a recession that's "long and ugly." Ouch.

At this point, if you're just about ready to curl up in a ball, blast some angry music, and maybe bust out your emergency supply of stress candy, no one would blame you. These persistent recession warnings can easily mess with your head, and this latest one certainly paints a pretty gloomy picture.

The good news, though, is that there are steps you can take to get yourself through a recession if predictions like the one Roubini just made end up coming true. Here are a few to start with.

1. Shore up your savings

The scary thing about a recession is that job loss can be rampant. That's what happened back in 2008, and if a prolonged downturn occurs, we could see unemployment levels tick back up. But a great way to protect yourself in the event of a layoff is to boost your emergency fund.

In general, it's a good idea to have enough money in your savings account to cover at least three to six months of living expenses. If you're still gainfully employed, it wouldn't hurt to go beyond the six-month threshold and save even more. That way, if a recession hits and lasts for a long time, you'll have a means of paying your bills if you wind up out of work for months. 

2. Shed some expenses

Thinking of renewing your cable plan or gym membership? Not so fast. If economic conditions worsen next year, you'll want to find yourself on the hook for fewer expenses, not more. Think about some of the recurring bills you have now that you don't necessarily need to keep paying for. You may find that shedding a few expenses still allows you to enjoy life, while having more options for banking additional money.

3. Boost your job skills

Sometimes, the most skilled, talented employees can lose their jobs during periods of economic distress. But the more you work on growing your job skills, the more protection you might buy yourself if layoffs end up hitting your company. After all, your manager may be hard-pressed to let you go if you bring a lot more to the table than your peers.

Try to stay calm

The idea of a recession is scary -- especially a "long and ugly" one. (You can't help but shudder just reading that.) But if you do your part to gear up, you may not lose quite as much sleep over the idea of a prolonged economic downturn.

And also, it's worth noting that while Roubini may have called our last crisis with precision, that doesn't guarantee he'll be right this time. So it pays to take his warning with a grain of salt.