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Finance
What do those who foresaw the 2008 financial crisis expect today?
With even the most seasoned investors growing uneasy, the analysts who foresaw the 2008 market crash share how they view the current state of the financial markets.Â
It was a quiet farewell. Warren Buffett, 95, wants to be even less involved in the day-to-day business of his investment company, Berkshire Hathaway, than before. In November 2025, he wrote in his letter to shareholders, “I am going quiet.” This marks the end of an era. Buffett, who has been CEO since 1965, cites his own age and that of his children as the reason for his retirement, which is why he is increasing donations to their foundations earlier than planned. Buffett’s estate will be worth around $149 billion, making it one of the largest fortunes in modern history.
However, there is speculation about another reason: Warren Buffett may be anticipating a new financial crisis. In any case, he has reduced his stock portfolio for twelve consecutive quarters. Â
The indicator compares the market value of all American stocks to the gross domestic product of the United States. The higher the value, the more likely there is a crash. Buffett once said, “When the ratio approaches 200%, you’re playing with fire.” The current value? Around 220% – higher than ever before.
At the same time, it was announced on Friday that Buffett has added the tech company Alphabet, Google’s parent company, to his portfolio. Previously, Buffett had largely stayed away from tech investments.
The situation on the financial markets is therefore unclear. NZZ am Sonntag asked seven people who foresaw the 2008 financial crisis one question:
Could a new financial crisis be looming?
Gary Shilling has been predicting crashes for a long time.
1 – Gary Shilling, Wall Street veteran, sees “enormous speculation.”
Gary Shilling has been predicting crashes for a long time. As far back as 1969, decades before his accurate prediction of the 2008 financial crisis, he foresaw severe slumps.
NZZ am Sonntag reached Shilling during a conference. What is he predicting this time? “The situation is confusing. I’m not sure which direction the financial markets are heading in,” says Shilling.
The 2008 financial crisis and the current situation are similar in that there was “enormous speculation on the markets” then, just as there is now. On a scale of 1 (everything calm) to 10 (on the verge of a crash), the world is at a value of 8. It is also worrying that government debt is much higher than in 2008 and that a bubble has formed in the tech industry. Because of these factors, the “probability of a financial crisis is dangerously high,” and yet lower than in 2008. At that time, more players were invested in the real estate market. Shilling notes, “Of course, we only know for sure after it has happened.”
“The wealthy would continue to consume, while more than half of households were heavily in debt.”
2 – Asset manager Meredith Whitney made a name for herself during the financial crisis as the “Oracle of Wall Street.”
Her name is inextricably linked to the decline of Citigroup during the financial crisis. Meredith Whitney, 55, warned in November 2007 of a “worrying situation” at Citigroup.
Whitney said at the time that the American corporation would be hit hard by a financial crisis and urgently needed money. The forecast earned her death threats, but she was correct: Citigroup cut tens of thousands of jobs and posted double-digit billion-dollar losses. Since then, Whitney has also been called the “Oracle of Wall Street.”
Whitney, alongside Brooksley Born – the most famous female prophet of 2008 – also expressed concern this year. In an interview with Financial Sense, she said that the real economy was much weaker than official data suggested. The wealthy would continue to consume, while more than half of households were heavily in debt. Whitney predicts, “The next downturn is already underway.”
3 – Stephan Schulmeister, an economist from Vienna, stated in 2007, “The stock market is naked.”
Born in 1947, Stephan Schulmeister worked for the Austrian Institute of Economic Research (Wifo) for more than 40 years. In an interview, he warns that “the consequences of a stock market crash would be much more devastating today than in 2008.”
Schulmeister, who published an essay entitled “The stock market is exposed” in August 2007 and also warned of the 2008 financial crisis at an early stage, nevertheless says, “Paradoxically, I currently consider the risk of a crash to be low.” Is this a reason to sound the all-clear?
No. Stock market values are “moving further and further away from reality,” and “illusory financial capitalism” prevails. According to Schulmeister, this means that stock market traders are believing less and less in the inevitable succession of bull and bear markets. Instead, they are confident that things will almost exclusively continue to improve. The stock market is seen as a “profit machine.”
Schulmeister does not want to make a forecast in terms of time. But says, “This will not go on forever; at some point, there will be a shock that triggers a price collapse. And then there will be a mood of doom and gloom.”
Today, Taleb continues to oppose the hype on the stock market.
4 – “The situation today is just as dangerous as it was in 2008,” says Nassim Taleb, author of The Black Swan.
Nassim Nicholas Taleb became famous with his 2007 book, The Black Swan. This refers to a rare, hardly predictable event with enormous consequences. The 2008 financial crisis, which Taleb predicted in his book, is a prime example of this. Taleb once said of his predictions, “The financial world hated me passionately; everyone thought I was an idiot.” But he was proven right.
Today, Taleb continues to oppose the hype on the stock market. He told NZZ am Sonntag, “The situation today is just as dangerous as it was in 2008.” The difference to the financial crisis, however, is that the debt is no longer in the financial system, i.e., with the banks, but with the governments.
The US has managed to protect the banking system. “But now we are facing a combination of exploding government debt and low growth,” says Taleb.
5 – The “prophet” Doug Noland warned of the “road to ruin” in 2007 – and sees parallels today.
Doug Noland warned experts early on about a financial crisis. In November 2007, for example, he wrote an essay about the “road to ruin,” in which he spoke of excessive lending. Today, he says, “The situation has many parallels with the years before 2008.”
Even now, many players assumed that there were “unlimited credit opportunities” that would provide “trillions for financing data centers and other infrastructure.” There is an “unprecedented expansion of global debt.” However, actual profits in the field of artificial intelligence (AI) are “highly doubtful.” Noland says, “AI and the associated financing represent the biggest credit bubble in history.”
The markets are experiencing a historic overvaluation that has broken- Claus Vogt
all records.
6 – Claus Vogt, the “dream dancer” of 2004, warns of a “historic overvaluation.”
Together with a colleague, Claus Vogt was one of the authors of the 2004 bestseller The Greenspan Dossier, which deals with the US interest rate policy of Alan Greenspan, then head of the Federal Reserve (Fed).
The subtitle of the book is How the US Federal Reserve is endangering the global monetary system. At the time, Greenspan was considered the highest authority on economic matters in the US, if not the world. Today, he is seen as one of the main culprits responsible for the financial crisis. Vogt’s criticism was therefore controversial, and he was labeled a “dreamer” who was “risking his neck” with his writings. A few years later, the financial crisis hit, triggered in part by the Fed’s interest rate policy.
And what does Vogt think today? “The markets are experiencing a historic overvaluation that has broken all records,” he told NZZ am Sonntag. He expects stock prices to fall sharply and a severe recession that “will be combated by central banks with all inflationary means.”
Politicians and central banks have let decades pass without reforming the financial system. As a result, the “crisis spiral” continues. Vogt says, “The consequences of the dot-com bubble in 2000 were manageable, but those of 2008 were much worse. If this bubble bursts, the effects would be devastating.”
A few days ago, it was also announced that Burry is closing his hedge fund because his own valuation is no longer in line with market valuations.
7 – Michael Burry, played by Christian Bale in The Big Short, the film about the financial crisis, is betting on the AI bubble bursting.
It is probably the most famous scene in the Hollywood film The Big Short, which was released in theaters in 2015. Michael Burry, played by Christian Bale, sits at the negotiating table, facing four representatives from the investment bank Goldman Sachs.
Burry calmly explains to them that he wants to bet against the US real estate market. The bankers think he is megalomaniacal. “That seems like a stupid investment,” they say. But Burry sticks to his guns, and the deal goes through. In the end, Burry wins hundreds of millions of dollars.
The film scene shows that in real life, hedge fund manager Michael Burry was also one of the first to predict the collapse of the US real estate market, and thus the 2008 financial crisis.
Burry is now likely to bet on a similar scenario. At the beginning of November, he bet against Palantir to the tune of $912m and against Nvidia to the tune of $187m with his hedge fund Scion Asset Management. In doing so, Burry sent a clear signal to the financial markets. A few days ago, it was also announced that Burry is closing his hedge fund because his own valuation is no longer in line with market valuations. Is he expecting a new financial crisis? Incidentally, Michael Burry’s name on the news platform X is Cassandra Unchained, after Cassandra from Greek mythology, whose prophecies no one wanted to hear.
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