When This Is Over,’ Market Falls 80%
Spitznagel: This Market Drop Is Just a ‘Trap’ — The Real Crash Is Still Ahead
Mark Spitznagel, one of Wall Street’s most bearish and accurate investors, says the recent stock market drop isn’t the big crash he’s been warning about — it’s just a setup.
“I’m expecting an 80% crash eventually. But this isn’t it. This is a trap,” Spitznagel told MarketWatch. “When the real thing hits, you’ll know.”
Spitznagel is the founder and CIO of Universa Investments, a hedge fund built to thrive during extreme market shocks. Universa follows a “Black Swan” strategy, inspired by Nassim Taleb, focusing on rare, devastating events — and profiting from them.
The fund made headlines in early 2020, returning over 4,100% as COVID fears tanked the market. Today, Spitznagel says Universa is still positioned as if a crash is coming — even though he doesn’t think it’s here yet.
“This is another shakeout. Not the end. The real reckoning will come when this bubble truly bursts,” he said. “It’s a deeply contrarian view, but I stand by it.”
Markets were volatile Monday. The Dow dropped more than 200 points (down 0.57%), the S&P 500 gained 0.35%, and the Nasdaq slipped 0.84%. Last week’s steep losses, sparked by new tariffs from President Trump, marked the S&P’s worst two-day slide since March 2020.
Spitznagel has long predicted a massive downturn, one potentially worse than 1929. He’s not trying to time it exactly but warns the U.S.’s mounting debt poses serious risk.
Earlier this year, he urged investors not to get caught off guard: “Don’t be the sucker who sells low and buys high.” His advice? Be positioned to weather chaos — easier said than done for most.
“Our clients have stayed long through this bull market,” he said. “The doomsayers think they’ve nailed it. Take it from an actual doomer — they haven’t. And they’re not ready for what’s coming.”
Still, Spitznagel believes retail investors can keep it simple. In a 2023 Fortune interview, he recommended low-cost index funds and disciplined investing — especially during downturns. His key point: stay invested, don’t overextend, and avoid panic selling.
