Central bankers continue playing Mr. Fix-It with monetary easing despite abundant warnings of the dangers. But the day of reckoning approaches warns Marc Faber, author of the Gloom, Boom & Doom report.

“I believe that markets will punish central banks at some stage through an accident,” he tells CNBC.

Monetary policies developed by central bankers, such as those in the United States and the European Union, are supposed to heal ailing economies. What these programs actually do is create distortions in the market, Faber explains.

Editor's Note: Economist Unapologetically Calls Out Bernanke, Obama for Mishandling Economy. See What They Did

“When you print money, money doesn't flow evenly in an economy. It flows to some people or some sectors first, and in this case it flowed into equities and until about five months ago bonds,” he notes.

“Either the bond market will collapse, bonds have actually been very weak considering the unlimited quantitative easing of the Fed. The other thing is that stocks could go into a bubble stage,” he adds.

Peter Schiff, founder of Euro Pacific Capital has also warned that governments' intervention in the bond markets creates distortions that are setting the stage for a catastrophe — one that could overshadow the financial crisis of 2008.

Schiff is credited for predicting the bubble that led to that crisis and last year he told Forbes, that this next blow-up could be seen as soon as 2013.

“The more you delay it, the bigger it will be,” he said.

“All of the people who were 100 percent wrong [about the 2008 financial crisis] are saying that everything is OK. I am telling them, they didn't solve the problem and are making it some much worse,” he added.

A lot of pain stands to be delivered if the forecasts of bears such as Faber and Schiff are correct.

Financial turmoil has driven enormous amounts of scared money into bonds. And, risk-averse retail investors who had largely abandoned the stock market are now returning to again plunge into equities.

Bloomberg says data from asset tracker EPFR Global shows Americans stuffed some $39 billion into equity funds just since the start of the new year.

Faber says stocks have gotten expensive. He points to the performance in markets that not too long ago were the prime drivers of fear such Greece, Portugal and Italy. They have seen double-digit gains, he says and in Asia, many markets have soared 250 percent from the lows.

“For the first time in four years, since the lows of 2009, I love this market because the higher it goes, the more likely we have a nice crash, a big time crash,” he tells CNBC.

Editor's Note: Economist Unapologetically Calls Out Bernanke, Obama for Mishandling Economy. See What They Did