‘Sell everything’ – here’s the incendiary RBS warning on deflation, risk and the next crash

The advice of Andrew Roberts, head of European Economics at RBS, has today gone around the world: its time to sell, ahead of a stock market crash. The RBS European rates research team said that things all “looks similar to 2008.” It seems to cap a bearish round of forecasts: Standard & Poor’s, the credit ratings agency, has more companies on a negative outlook than at any time since the last crash. Are we due another one? The fill document of the RBS note is here (pdf). And the edited highlights below:-

I think my ‘severe downside for the world’ call is looking ok so far. The fact that we are going well is very dangerous for every investor in the world. Why? We posited a negative outcome in the Year Ahead, risks for which were very high, and massively underpriced, with consensus on its usual ‘goldilocks’’ platform. What we are now seeing is those risks now playing out. That is the problem.