Bert Dohmen: No Time for Buy and Hold

When everyone is telling you that this credit crisis could not have been predicted, you can point to one man who boldly -- and incredibly accurately -- told you exactly what was going to happen. His name is Bert Dohmen, for the past 30 years the publisher of the Wellington Letter, one of my all-time favorite newsletters.

I interviewed Dohmen in March following the publication of his book, Prelude to Meltdown. His predictions, below, were frightening. But his forecast today is even more shocking.

Bert Dohmen in March 2008

"When the Dow Jones Industrial Average made its first close above 14,000, Dohmen sent out a warning.

"'The world has seen the greatest credit bubble ever seen by man. ... The enormity of this problem is beyond anything we have ever seen in financial history.

"'The size of the leverage and the financial instruments that are outstanding, and now defaulting, are beyond the ability of any central bank, or all of the central banks combined, to bail out. We've never had a situation where the central banks were not big enough to bail out a situation -- but we have it now." ...