"My working experience of the last 30 years has convinced me that policymakers' efforts to manage the economic cycle have actually made things far more volatile… The current round of quantitative easing will be no different," said Edwards in a weekly strategy report.
"We have written previously, quoting Marc Faber, that 'The Fed Will Destroy the World' through their money printing. Rapid inflation surely beckons. But that will not occur without firstly a Japanese-style loss of confidence in policymakers as we dive back into recession and produce dislocative market moves."
(Read More: Marc Faber: If I Were Bernanke, I Would Resign)
In the note, Edwards said central banks' stimulus measures will drive the world towards global recession, soaring inflation and a "Japanese-style" loss of confidence in policymakers.
"We may have seen the peak of nominal U.S. GDP growth for this cycle. An unfolding recession should see 10-year bond yields dragged ever lower and the Fed moving to QE infinity (squared)," he said.
Edwards advised investors to take refuge in gold, and added that gold's current fall-off was still in sync with his ultra-bullish outlook on the precious metal.
"Gold corrected 47 percent from 1974-1976, before rising more than eight times to $887 per ounce in 1980. A steep correction is normal before the parabolic move…Holding gold is a bet against central banks competency and given their track record that is certainly a bet I'd be happy to still take," he said.
(Read More: Why Gold's Fall Is No Big Deal for South Africa)
And for those who might think his outlook outlandish, Edwards had pithy advice.
"The late Margaret Thatcher had a strong view about consensus. She called it: 'The process of abandoning all beliefs, principles, values, and policies in search of something in which no one believes, but to which no one objects.' The same applies to most market forecasts," said Edwards.
(Read More: Kudlow: Margaret Thatcher, Freedom, and Free Markets)
"In that vein, we repeat our key forecasts of the S&P Composite to bottom around 450, accompanied by sub-1 percent U.S. 10-year yields and gold above $10,000."