Of the 8,000 hedge funds in existence, as many as one-third will close their doors, Emmanuel Roman, head of GLG Partners predicted at a conference on hedge funds in London, Dow Jones Reports.

 

As a result of the upcoming “Darwinian” process, thousands of hedge funds will go out of business, said Roman, who called the current financial crisis one of the greatest banking fiascos of the past 100 years.

 

Professor Nouriel Roubini echoed Roman’s fears, painting an even worse picture. Market volatility could become so severe, Roubini said, that he could envision a major exchange shutting down for more than a week.

 

Roubini’s outlook for the U.S. is especially bleak. “It’s the beginning of the decline of the U.S. financial empire,” he said. “The bailouts have not worked because the markets are no longer rallying, and the policymakers have run out of options. It’s like we’re walking blind in a minefield. Every situation has become risky, and no one can trust each other. The banks are too big to be allowed to fail, but they’re also too big to be saved.”

 

And the professor’s outlook for the world was even worse. “The Great Depression ended in a massive war. I hope that’s not going to happen, but it’s pretty ugly now,” the economist said, predicting further geopolitical tensions between the Western world and emerging markets.

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