Mark Spitznagel, the hedge fund manager behind Universa Investments who made $1 billion in a single day for his clients during the 2015 \u201cFlash Crash,\u201d says he is seeing similarities to 1929, the year of the Wall Street crash<\/a>, he told the Wall Street Journal. <\/a><\/p>\n Spitznagel, a protege of \u201cBlack Swan<\/a>\u201d author Nassim Nicholas Taleb, is known for hedging tail risks, or strategies that lose some money<\/a> most of the time but earn big when the market<\/a> collapses. <\/p>\n \u201cI\u2019m the crash guy \u2014 I remain the crash guy,\u201d Spitznagel told the Journal. <\/p>\n Spitznagel is warning individual investors<\/a> against making hasty changes to their portfolios, noting those who can\u2019t buy tail-risk protection will still make positive returns in the long run if they don\u2019t sell. <\/p>\n \u201cThe biggest risk to investors isn\u2019t the market \u2013 it\u2019s themselves,\u201d he said. <\/p>\n Spitznagel sees a strong rally ahead, with short-term gains potentially pushing the S&P stock index up to as high as 8,000 points, a 20 percent gain from today\u2019s level, according to the report. <\/p>\n However, he expects the rally to eventually lead to a big, 1929-style crash, meaning there would be a large and potentially catastrophic downturn following the gains. <\/p>\n Spitznagel believes this, in part, because every time the market or economy<\/a> runs into trouble, the Federal Reserve steps in to save it with moves such as low interest rates or bailouts<\/a>. <\/p>\n He compared it to how firefighters quickly put out forest fires only to have too much dry tinder accumulate, leading to \u201cfirebombs.\u201d Because of today\u2019s near-record stock valuations, the eventual \u201cfirebomb\u201d could be explosive, according to the report. <\/p>\n If a major sellout is looming, as Spitznagel says, large gains now would not be out of the norm, according to the report. Since 1980, the S&P 500 has returned 26 percent annualized in the 12 months preceding the start of a bear market, or a sustained market downturn. <\/p>\n The last 12 months\u2019 rally has been twice as high as that average ahead of the 1929 peak, according to the report. <\/p>\n Both individual and professional investors typically increase their stocks during times like today, according to the report. Strategists at State Street said that institutional investors\u2019 exposure to equities has reached its highest since November 2007, just before a vicious bear market.<\/p>\n \u201cThe markets are perverse,\u201d Spitznagel told the outlet. \u201cThey exist to screw people.\u201d <\/p>\n","protected":false},"excerpt":{"rendered":"Your support helps us to tell the story From reproductive rights to climate change to Big Tech, The…\n","protected":false},"author":2,"featured_media":162310,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[45,49,48,46],"class_list":["post-162309","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-ca","tag-canada","tag-economy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/162309","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=162309"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/162309\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/162310"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=162309"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=162309"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=162309"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"A](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2025\/09\/Debt_Limit_Markets_88687.jpg\")
A top Wall Street hedge fund manager is predicting a massive rally before an even larger stock market crash, similar to the one before the Great Depression (Copyright 2022 The Associated Press. All rights reserved.)<\/p>\n