US stocks could crash 25-50 percent

The S&P 500 hit a record high on Friday but some see rising risks of a US stock market crash.

Saxo Bank’s head of FX strategy John Hardy said that there is a risk that a number of asset bubbles built up during 2017 could burst in the year ahead.

“In 2018 we see the pendulum swinging back in favor of pronounced volatility risks as the irony of long periods of quiet and complacency in asset markets is that they sow the seeds for future volatility as investors underestimate tail risks and overleverage their bets on a continuation of the cycle,” he said.

Among the risks he sees are a spike in US Treasury yields and a 25 percent plunge in the S&P 500.

Meanwhile, David Tice, who runs the Prudent Bear Fund, told CNBC that there is “potentially a 50 percent chance there will be a 25 percent rally” in 2018.

However, he also said that there is a 25 percent chance of a 50 percent decline.

“Longer-term, the market is going to suck,” he said.