Economist Says Stock Market Will Witness Largest Crash Since 1929 As U.S. Dollar Explodes

Macroeconomist Henrik Zeberg expects a massive blow-off top for equities in the coming months, saying recently that the stock market could likely head to one of the biggest crashes in history.

In a Twitter post on Saturday, Zeberg said that stocks are likely on their way up, while the dollar index (DXY) — which pits the USD against a basket of foreign currencies — is likely on its way down.

The macroeconomist also shared a chart that included his prediction for the iShares MSCI Emerging Index Fund, an exchange-traded fund (ETF) that aims to track an index of large and mid-cap emerging market equities. 

Let me be very clear:

We have the Largest Crash in Equities / Risk Assets since 1929 coming! Deep Recession!

But not yet...

First the inconceivable and very hated #BlowOffTop which will pull investors in on the wrong side before Crash

Stay on top: https://t.co/X89WATQHEP pic.twitter.com/qLHucQFhjF

— Henrik Zeberg (@HenrikZeberg) April 29, 2023

Zeberg tweeted that he sees the equities markets collapsing as the dollar index goes on a parabolic surge.

This is not the look of a market, which is about to crash - no matter how much you swear!#FAANG leading higher. Much higher! pic.twitter.com/YKK0u9oQQI

— Henrik Zeberg (@HenrikZeberg) April 28, 2023

Last week, Zeberg predicted that Bitcoin (CRYPTO: BTC) would skyrocket this summer as worries over an impending recession gradually fade. The macroeconomist said that a “blow-off top” scenario is unfolding for both stocks and crypto, caused mostly by a drop in fixed-income yields. 

Zeberg added that he believes that a significant decline in yields would drive a market rally while the economy would remain in a comfortable “Goldilocks zone.” 

Meanwhile, Morgan Stanley's Managing Director and Chief Currency Economist Stephen Jen told the Financial Times last week that the U.S. dollar has “suffered a stunning collapse as a reserve currency, which has seemingly quickened after Washington decided to wield its control over the dollar-based international financial system against Russia.”

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