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Dr. Robert Haugen From Precy Dumlao, Opalesque Asia:

Dr. Robert Haugen, who was ranked as the 17th most prolific researcher in the history of finance worldwide, has recently warned of an unprecedented increase in the money supply that will result to a major financial disaster "SOON".

Haugen, who has written 15 books on the stock market and has been published collectively in 7 languages, and who is the discoverer of the Low Volatility Anomaly and the inventor of the Expected Return Factor Model, said that the money supply (currency plus bank reserves) has more than tripled, from $800bn to $2.7tln in just two years. He warned that the trend shows an upward arrow.

"Nothing has come anywhere close to this policy since the inception of the Federal Reserve," he said in a statement.

He pointed to the U.S. government policy of Quantitative Easing QE1 and QE2 for the $1.9tln rise in the money supply. "This enormous heap of money is essentially in bank vaults and it may be OK if it stays there, but the idea is to incent banks to lend. If and when banks actually lend there is a multiplier effect that results from the fact that the current reserve requirement is 10%, so banks can lend ten times their reserve. $2.7tln can turn into $27tln. Before you know it, were talking about real money. For perspective, the debt ceiling that we are all agonizing over is $14tln, about half the potential $27tln that could spill into the economy. And it could be even more ......................

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