It takes a certain level of boldness to predict a major market index going down roughly 60%, but John Hussman makes a pretty good case for it.
He also gives considerable input on answering a reader’s potential question of “If the market is over-valued, why hasn’t it been sold off already?” or the correlated question of “What prevents an already over-valued market from becoming even more over-valued?”.
Either way, it looks pretty miserable for large index investors – an investor that is forced to be fully invested in the marketplace would likely be well-advised to hold fixed income securities.
(Update, August 5, 2018: It has been brought to my attention that his flagship fund’s average performance hasn’t exactly been stellar – as of June 30, 2018 his 10-year average return is a negative 6.65%, during one the largest bull markets in history after the economic crisis! Ouch!)
He is probably a smart guy, but is definitely the proverbial stopped clock.