John Hussman is the founder of Hussman Funds. A former professor of economics and international finance at the University of Michigan, he is said to have predicted the 2008-2009 recession.

If you invest directly or indirectly in the financial markets I suggest you read and think about an article Mr. Hussman wrote that was published on July 30. The article is somewhat long and detailed, but worth the time necessary to read it. In the article, Mr. Hussman asks and answers the question: so what do I worry about? His current answer:

"I worry that investors forget how devastating a deep investment loss can be on a portfolio. I worry that the constant hope for central bank action has given investors a false sense of security that recessions and deep market downturns can be made obsolete. I worry that the depth of the recessions and downturns - when they occur - will be much deeper precisely because of the speculation, moral hazard, and misallocation of resources that monetary authorities have encouraged. I worry that both a global recession and severe market downturn are closer at hand than investors assume, partly despite, and partly because, they have so fully embraced the illusory salvation of monetary intervention."

Topical Reference: No Such Thing As Risk? (Hussman), from Advisor Analyst, John Hussman, July 30, 2012 - reading time 7 minutes.