Bloomberg today has an interview of the Austrian-minded founder and manager of the Prudent Bear Funds.

Some take-aways:

• Policy makers and central bankers are to blame for blowing this bubble.

• “Institutions and foreigners no longer trust our structures, our insurance, our ratings, etc., therefore we’re in big trouble.”

• “Over 18 months, this market will be down 50, 60, 70 percent.”

• This market is like a slowly boiling frog that doesn’t feel the increasing heat.

• The technology sector is the next big shoe to drop. Multiples are still high and demand will slow dramatically. US demand has slowed and now Asia and Europe are slowing.

• A global slowdown is in the works, since the world is so dependent on US growth, but 3-5 years out, Asian growth should dominate.

• Tice is still long precious metals, since the dollar should “decline dramatically” and other currencies should follow in competitive devaluation.

• He doesn’t think gold has topped, though he did cut gold and mining positions dramatically from what he held past few years. He was surprised by the depth of the sell-off, but thinks this is a “decline that ought to be purchased.”

• He closed out some home building shorts and some consumer discretionary shorts, though consumer spending should slow dramatically.

• Commercial real estate is another shoe that is going to drop.

As an interesting aside, Tice just sold the Prudent Bear Fund and his Global Income fund to Federated Investors Inc. for $43 million plus up to $99.5 million in contingent payments over five years. Why sell now if he thinks we are just at the start of a huge bear market that should see great returns and increased interest in his funds? It may be a bit presumptuous of me to venture this guess, but as another ultra-bearish investor, I see his timing as very prudent.

BEARX is US-based and relies heavily on short-selling, so it is subject to the whims of a hostile congress regarding this supposedly nefarious activity. And Tice’s Prudent Global Income Fund faces the risk of exchange controls emerging in a dollar meltdown.

Also, Tice is presumably prudent enough in his personal affairs to realize that the window is snapping shut for serious asset protection in this environment, so he must have felt a great compulsion to get liquid while he could. Just as he would probably not recommend 95% of an investor’s assets in his funds, he was likely nervous going into a depression with so much of his own net worth in illiquid business equity.

At any rate, he and his investors will still benefit from his management of the funds for Federated.