J.P. Morgan’s top quant, Marko Kolanovic, predicts a “Great Liquidity Crisis” will hit financial markets, marked by flash crashes in stock prices and social unrest.
The trillion-dollar shift to passive investments, computerized trading strategies and electronic trading desks will exacerbate sudden, severe stock drops, Kolanovic said.
Central banks will be forced to make unprecedented moves, including direct purchases of equities, or there could even be negative income taxes.
Timing of when this next crisis will occur is uncertain but markets appear to be safe through the first half of 2019, he said.
https://www.jpmorgan.com/global/research/10-years-after-crisis