The global economy is at risk of crippling hyperinflation and “extraordinary” conditions that could prompt the worst financial crisis since World War II, according to major hedge fund Elliott Management.

Elliott Management, led by famed billionaire investor Paul Singer, warned clients that extreme conditions present in the current economic landscape have “made possible a set of outcomes that would be at or beyond the boundaries of the entire post-WWII period,” according to a letter obtained and published Wednesday by The Financial Times.

The letter also cautioned that economies around the world are “on the path to hyperinflation” — a term referring to uncontrollable acceleration in the cost of daily necessities.

While hyperinflation is not inevitable, Elliott said it would cause “global societal collapse and civil or international strife” if it does occur.

Elliott Management is one of the world’s most well-respected hedge funds, with approximately $56 billion in assets under management. Elliott’s bets are up more than 6% this year, and the firm has recorded an annual loss just twice since 1977, according to The FT.

The market has been under intense pressure this year as the Federal Reserve rapidly tightens interest rates in a scramble to lower inflation. The Russia-Ukraine war has added to existing supply chain difficulties and caused a jump in food and commodities prices.

The Fed’s benchmark rate hit its highest level since 2008 on Wednesday after policymakers implemented a fourth straight hike of 0.75%.

The US inflation rate has fallen slightly from its peak over the summer, though it ran at a hotter-than-expected 8.2% in September. An updated Consumer Price Index reading is slated for release next week.

The Florida-based entity noted that current conditions are uniquely dangerous, even when compared to past financial crises such as the Great Recession in 2008 and the 1970s inflation surge.

“Investors should not assume they have ‘seen everything,’” the letter added.

Elliott Management declined to comment.

The broad-based S&P 500 is in bear territory, falling about 22% since January as investors increasingly fear Fed policy will trigger a recession. The tech-heavy Nasdaq is down nearly 35%, while the Dow Jones Industrial Average has fallen about 12%.

Elliott stated that markets face an array of “frightening and seriously negative possibilities” – with a 50% decline in equities a “normal” potential outcome given the risks.

The firm also took aim at the Fed and other central bankers, accusing policymakers of exacerbating the current trouble and being “dishonest” about the root causes of the decades-high inflation currently plaguing American consumers.

Fed Chair Jerome Powell and other central bankers have largely blamed the problem on unprecedented supply chain disruptions without acknowledging the impact of historically loose fiscal policy during the COVID-19 pandemic.

Elliott is just the latest prominent voice to raise alarm bells about the global economic outlook.

Ex-Treasury Secretary Larry Summers – another outspoken critic of the Fed’s posture on inflation – asserted in September that the level of risk in global markets was at its highest since 2007, when the world was on the precipice of the Great Recession.

Hedge fund wizard Michael Burry – whose bet against subprime mortgages was famously chronicled in “The Big Short,” has argued for months that markets are in the midst of “the mother of all crashes.”