International investor Jim Rogers recently claimed that he was expecting the worst market crash in modern times to hit within the next two years.
Speaking to the Business Insider CEO Henry Bloget on the “Bottom Line,” Rogers warned that some stocks in America were “turning into a bubble” that was destined to burst “later this year or next,” adding that everyone should be worried.
Responding to Bloget’s question about what would trigger such a crash, Rogers could not predict a particular source but gave the Icelandic market, US-based investment banks Bear Stearns and Lehman Brothers—which all went bankrupt—as examples, emphasizing that “these things always start where we’re not looking.”
The 74- year-old investor also repeatedly stressed that the crash was “going to be worst in your lifetime. We’ve had financial problems in America—let’s use America—every four to seven years, since the beginning of the republic. Well, it’s been over eight since the last one. This is the longest or second-longest in recorded history, so it’s coming,” Rogers explained.
The investor also said that the US Federal Reserve would not be able to rescue the United States from a market crash. “You’re going to see governments fail. You’re going to see countries fail, this time around. Iceland failed last time. Other countries fail. You’re going to see more of that,” he said.
Beware the Stock Market
Various signals point to a dangerous overheating of financial markets and a poor memory of what they experienced in 2008, Lombardi Letter reported.
Therefore, investors should beware the stock market forecast for the next three months (Q3 2017). This is especially true for the US markets. The stock market outlook is cautious at best, but the third quarter of 2017 looks particularly vulnerable to shocks.
Before any analysis or general stock market prediction begins, it’s important to establish a factor that many have overlooked about the stock market forecast for 2017. The financial leverage levels of US companies have risen significantly since 2008. Meanwhile, the market capitalization levels of such companies compared to earnings are downright ridiculous.
Even Europe, which many had given up as a basket case, seems to be better than Wall Street. Instead, in the United States, many are calling out the markets for jumping headfirst into another 2008 subprime crisis. That’s why investors should not be worried whether or not the markets are heading into turbulence. In fact, there are experts predicting a stock market crash.
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