Global macro trader says next 3 months mark ‘edge of the cliff’ for markets and ‘we’re there right now’ (Source marketwatch.com) Financial markets are at a crucial inflection point and Wall Street investors should look no further than the U.S. dollar for the clearest sign of the increasing stress on the system that could ignite a financial crisis a la 2008, says Raoul Pal. The former GLG global macro hedge-fund co-manager, who was among the few investors that predicted and profited amid the 2008-09 mortgage meltdown, told MarketWatch in a Wednesday interview that the current set up has led him to a grim forecast for the economy and markets.

“The conclusion has to be that this is the most fragile point in global financial markets since the eurozone crisis in 2012, and potentially the start of the Great Recession in 2008,” he said.

Pal says the U.S. dollar’s relative strength, measured on a trade-weighted basis, is rippling around the world, particularly as global central banks adopt easy-money policies that appear to be more accommodative than even the U.S. Federal Reserve, driving local currencies lower against the buck.