Some expert investors have described the market's reaction to the SEC's accusations against Goldman Sachs as a 'storm in a teacup.' They believe the fallout would be short-lived, and eventually present buying opportunities.
However, billionaire investor Jim Rogers, Chairman of Rogers Holdings, feels slightly differently.
"Markets are overdue for a correction," Rogers told CNBC in a telephone interview Saturday. "Any market that goes up this much, this fast, this steadily without correction - it's not normal. When that sort of things happens, the market could be setting itself up for a 15 - 20% correction."
Rogers does not think the Goldman issue itself would cause a correction - it would be more of a catalyst.
"When the markets are ready for a correction, something will come along... the straw that breaks the camel's back."
The investment guru did not seem all that surprised by the SEC's actions, noting that these kind of investigations usually take place after major financial meltdowns (like dotcom).
Borrowing a quote from Warren Buffett, Rogers said "when the tide goes out, you see who's swimming naked. I'm sure there will be many many more skeletons to come."
Thoughts of more high profile lawsuits on Wall Street and a pending market correction may send some into a panic, but Rogers said it is important to stay calm.
"What I am doing is watching. If this is going to be the beginning of a correction. we will know how the markets does next week, by Thursday, I suspect. It's not time to sell in any significant way."
Rogers also said investors should start thinking about adding shorts to their portfolio, and suggested shorting indexes. Select bank stocks are also in his sights - the legendary investor is waiting for the right time to build short positions in them.
And then, there's always gold.
If the SEC's crusade against fraud on Wall Street gathers pace, Rogers said, one should watch out for opportunities to buy into the yellow metal. "Go back to 2008, you have AIG go broke, Lehman go broke. There was a gigantic forced liquidation in commodities - not because of fundamentals, but because people were forced to sell... it would be an opportunity."