Choose Your Own Crisis Scenario

Today's financial markets are suffering massive imbalances almost certain to lead to some sort of disaster. Where will it hit?

I spend a lot of my time thinking about "low-probability disasters." That's a polite term for those unexpected, unwelcome events that take a stock market or a currency down 40%, 50%, or even more in a relatively short time. Low probability disasters -- like the 1997 Asian financial crisis or the tech bust -- can wipe out years of gains in a flash. They're the monster in the woods that every once in a while turns out to be real.

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