Tens of millions of household savings and retirement nest eggs in jeopardy: Investment expert warns of rare market scenario that has only occurred three times in more then 100 years

Millions of Americans will have their retirement and savings destroyed by a looming stock market plunge of some 50 percent, one economist has warned.

Investment influencer Grant Cardone has predicted the stock market is set to fall some 50 percent - wiping out Americans' retirement funds and savings.

To support his claim, the real estate investor pointed to the 'yield curve,' which has been inverted for 500 days, since July 2022.

He noted in a post to X that has only happened three times in the past century, in 1929, 1974, and 2009, and that each time the market fell more than 50 percent.

The stock market also took a tumble just a few years ago in 2020. The S&P 500, a measure of the performance of America's 500 largest companies, fell almost 30 percent in early 2020 but fully recovered within six months.

Many Americans have savings accounts and 401(K)s containing funds that are invested in the stock market, meaning their worth can closely trace the S&P 500.

Private equity fund manager Grant Cardone - who has previously provided his expertise to firms such as Google and Morgan Stanley - has warned that millions of Americans are poised to lose their retirement and savings by a looming stock market plunge

Taking to X ,Cardone emphasized the compounded threat by prospective a 50 percent loss in retirement accounts and current rates of inflation, which could make the total loss feel more like 75 percent, he said

A yield curve shows how the interest rates of bonds with different durations vary - from those that will mature in just months to those that will mature in a decade.

Usually, longer term bonds offer better returns because investors are taking extra risk in locking up their money for a longer period.

An inverted curve, as Cardone is referring to, occurs when short-term rates are higher than long-term rates, implying investors are expecting an economic slowdown.

It is therefore sometimes considered a sign that a recession is looming.

But increasingly the indicator has become unreliable as a predictor of recession, according to some experts.

'I feel the inverted yield curve is just not as good an indicator as before,' Zhiwei Ren, portfolio manager at Penn Mutual Asset Management, told Reuters last month.

On Sunday, Cardone shared a graph on X, formerly Twitter, showing the telling yield curve sported by the all-important index.

He added: 'WARNING: Stock Market is due for 50 percent correction taking S&P below 2674.

'Tens of millions of households will have their retirement & savings destroyed by being invested in stock market at these levels.'

'The yield curve has been inverted for +500 days,' he added.

'Each time markets declined MORE than 50%, [ a financial crisis followed].'  

'If your retirement account loses 50 percent before considering the destruction of your principals’ purchasing power due to inflation resulting in a 75 percent loss,' he concluded.

Many commentators under his post on X questioned what Cardone - who sells investment courses - was saying. They pointed out that it appeared he was trying to get Americans to to move their retirement savings away from established funds into to his real estate fund. 

One wrote: 'Reale state guy telling folks to dump all their 401(K)s into his real estate fund.. make him rich instead. Got it….'

The warning comes on the heels of another cautionary statement from the expert, who has worked as a consultant for firms such as Google, Morgan Stanley, Toyota, GM, Nissan, Infiniti, Reinhardt, Carrier and even the U.S. Army.

As proof, the 20-year vet pointed to the history of the also rising S&P's yield curve, which has been inverted for over 500 days

As proof, the 20-year vet pointed to the history of the also rising S&P's yield curve, which has been inverted for over 500 days. This has only happened three times in the past century, he said - citing 1929, 1974, and 2009 and the crashes that followed. Pictured: a foreclosure sale in 2009 

Following each of these crises, the market experienced declines of more than 50 percent, erasing billions from Americans 401Ks in the process

The warning comes on the heels of another cautionary statement from the pedigreed expert, who in December told Fox News the 'greatest real estate correction' of his lifetime was on the horizon

He called it a 'great opportunity' for individuals and family buyers, as Manhattan rents dropped for the first time since the pandemic. Mortgages and inflation, meanwhile, remain sky-high

In December, Cardone told Fox News the 'greatest real estate correction' of his lifetime was on the horizon - calling a 'great opportunity' for individuals and family buyers. 

'It [real estate correction] is going to be a great opportunity for individuals, regular, everyday people to actually grab trophy real estate from institutions,' he said at the time

'This has never happened in the country, it’s going to be at epic levels.'

As he aired that warning,  Manhattan rents dropped for the first time since the pandemic, a welcome sign of respite for long-wary Americans.

Mortgages and inflation, however, remained sky-high - a phenomenon that has since worsened months later, following a series of rate hikes to protect the dollar's purchasing power.

On Monday, Cardone shared another graph showing how he believes his previous forecast is still to come, and how rents have remained stagnant for the past few months after an alarming skyrocket following the the first year of the pandemic.

On Monday, S&P500 futures ticked lower by 0.02 percent, after gaining 1 percent during the day's main trading session

As for the Dow, the index wrapped its fourth positive day in a row, rising nearly .5 percent despite a below expectations job report for the third quarter

Cardone - seen here at this year's 10X Growth Conference in Hollywood Florida - has worked as a financial consultant for firms such as Google , Morgan Stanley, Toyota, GM, Nissan, Infiniti, Reinhardt, Carrier and the US Army

'Flat rents will stop new construction and Create MASSIVE supply problem & benefit real estate investors with 25-30% rent growth starting in 2026-28,' he said. 

He blames the Federal Reserve for 'single-handedly' killing the housing market with raising interest rates, recently saying '[Fed Chairman Jerome Powell] has not controlled inflation. He has failed miserably. 

'What he has actually done is created and, in the meantime, stopped the housing industry.'

To jump-start the industry, Cardone is urging Powell to 'get out of the way' and 'let the market to do its thing'. 

He added: 'Interest rates will have to come down in order for pricing to come down. This is actually a contradiction to what most people think. 

'But when interest rates come down, mortgage applications will go up and people will start selling their homes.' 

House prices remain high, but Grant hopes that if mortgages become more affordable, they will drop as more people sell their homes

On Monday, Cardone shared another graph showing how he believes his previous forecast is still to come, and how rents have remained stagnant for the past few months after an alarming skyrocket following the the first year of the pandemic

To mitigate risks, Cardone recommends retirees transitioning their investments from the stock market-reliant 401ks to real assets that generate monthly cash flow, such as property.

The tide does seem to be turning - Manhattan rents dropped for the first time in over two years late last year - as a glut of empty apartments force owners to cut costs. 

Meanwhile, a separate report from real estate company Redfin painted a similar picture for the US market as a whole. Rents made the biggest drop in over three years to November, amid a recent boom in vacancies.

Mortgage rates on the other hand continue to climb. It now takes around 41 percent of the median household income to cover monthly principal and interest payments - for the past 35 years it has averaged less than 25 percent, ICE noted.

To mitigate risks, Cardone recommends retirees transitioning their investments from the stock market-reliant 401ks to real assets that generate monthly cash flow, such as property.

 Citing how he has assisted thousands in doing just that without any penalties, he claimed it will allow individuals to depend on income from these assets during retirement rather than watching their savings wane. 

'I did this for my sister and it changed her life forever,' the expert assured, after previously chiding the US for becoming a 'renter's nation'.

 'It’s unaffordable for people to own a home today,' he told Fox News, before putting his homes in Malibu and Miami for sale.

As for why, the financier cryptically wrote on Twitter this month: 'I know something.'