Five years have passed since the financial crisis brought the world to its knees.
Gone are likes of Lehman Brothers and Bear Stearns among others who were driven into ruin by the epic collapse of the housing bubble.
In the aftermath, life appears – on the surface at least – to be returning to some form of normal. Normal, that is, if you happen to have a job.
It may be anemic, but there is real growth. And the truth is even housing may have bottomed.
Admittedly, it's not exactly sunny, but it's nowhere near as dark as it was in 2008 either.
Or is it?....
According to a recent survey by State Street Global Advisors, there's still plenty to worry about-especially in the sordid world of finance.
In fact, the world's third biggest money manager said 71% of investors worldwide are afraid the next Lehman could strike within the next twelve months.
Keep in mind, we're not talking about small retail investors here. Not at all.
We're talking about some of the largest and best-informed, most sophisticated pension funds, private banks, and asset managers in the world and the wide majority of them think a "black-swan" type event could strike before this time next year.
A Black Swan Rerun
What do they think could be the trigger for this event?
Their biggest fears revolve around the next global recession, a potential euro break-up, or another episode of bank insolvency.
Other concerns cited were a slowing Chinese economy, an oil price shock, or the risks of asset bubbles from unending stimulus. Thanks to ongoing debasement wars, the asset class they feel holds the biggest risk at the moment is the currency markets.
These elite asset managers are not alone in their fears either .
For its part, the International Monetary Fund (IMF) sees mounting risks too, with European uncertainty as the most prevalent concern.
Consequently, the IMF's is pushing its plan to harmonize the European financial system through a more integrated banking union and fiscal integration. They've warned that intensifying pressure on banks could lead to "asset shrinkage" ranging from $2.8 trillion to $4.5 trillion by end next year.
Of course, "asset shrinkage" is nothing more than a fancy way to say: "lose money."
Yet in a complete "about face", this bastion of economic wisdom has taken a dramatic new stance on austerity. After years of pushing financial aid recipients to right their fiscal ships, the IMF's Christine Lagarde now favors relaxing timelines for Greece and Spain to narrow their deficits.
Given the circumstances, you'd think this is a no-win situation. But the truth is other options do exist, and some have even worked out rather well.
The Right Way Out Of a Financial Crisis
Take Iceland for instance.
Iceland was slammed by the 2008 financial crisis. It witnessed the collapse of three major banks, a stock market crash, and the blow up of potentially crushing debt for its small population of 320,000.
Not surprisingly, it all led to riots, something this peaceful and remote northern nation hadn't seen for 50 years.
The case of Iceland is fascinating, because it's a microcosm of what could have happened elsewhere.