David Stockman, who had been budget director under President Ronald Reagan, created quite a stir when he predicted a stock market crash in an op-ed piece in The New York Times Sunday.
"Over the last 13 years, the stock market has twice crashed and touched off a recession: American households lost $5 trillion in the 2000 dot-com bust and more than $7 trillion in the 2007 housing crash," Stockman, now an investment banker, wrote. "Sooner or later – within a few years, I predict – this latest Wall Street bubble, inflated by an egregious flood of phony money from the Federal Reserve rather than real economic gains, will explode, too."
Money Morning Chief Investment Strategist Keith Fitz-Gerald joined FOX Business Network's "Varney & Co." Monday to tell investors if Stockman's prediction is on point.
"If you look to Stockman's article … to me that's a huge contrarian signal," Fitz-Gerald said.
Check out this video to hear Fitz-Gerald on what investors should do now, what to expect from markets, and why this situation is so different from March 2009.