Hedge funds closures will eliminate about 30 per cent of the industry and policy makers may need to shut markets for a week or more to stem panic, according to presentations at a London investor conference reported by Bloomberg.

"In a fairly Darwinian manner, many hedge funds will simply disappear,'' Emmanuel Roman, co-chief executive officer at GLG Partners said at the Hedge 2008 conference in London. US regulators will find a way to force regulation, according to Mr Roman.

Nouriel Roubini, an academic who spoke at the same conference, said hundreds of hedge funds will fail as the crisis forces investors to dump assets. “We've reached a situation of sheer panic. Don't be surprised if policy makers need to close down markets for a week or two in coming days.”

Nonetheless, Mr Roman said, markets have “overshot” and in some areas, including loans, there are “once-in-a-lifetime opportunities,'' he said. "At some point, people will say this isn't 1929 to the power of 10.''

Mr Roubini said: “Things will get much worse before they get better. There are about a dozen emerging markets that are now in severe financial trouble. Even a small country can have a systemic effect on the global economy. There is not going to be enough IMF money to support them.”