Steven Ferdman Copyright: Steven Ferdman

Investors have been warned to prepare for the worst by former Federal Reserve chair Alan Greenspan.

The economist, who led the bank from 1987 to 2006, has told CNN that he doesn't expect stock prices to go any higher than they are currently.

"It would be very surprising to see it sort of stabilise here, and then take off," he said.

If they do go up then investors should prepare for a rapid correction, he warned.

"At the end of that run, run for cover."