Deflation: Harry Dent “Understanding Demographics Is Vital to Success”
In this segment from one of his talks at the Casey Research Recovery Reality Check Summit, economics expert and author Harry Dent explains how shifting demographic trends lead to economic cycles and why the current US federal government is so afraid of deflation.
Harry’s complete presentation – as well as the speeches of 30 other economic and investment luminaries from this Summit – is available to you in MP3 or CD format. Listen to experts like David Stockman, Harry Dent, Lacy Hunt, James Rickards, John Hathaway, Chuck Butler – their assessment of what investors should expect and their best investment strategies for the coming years. Get more details here.
Harry S. Dent, Jr. is CEO and founder of economic research and analysis company HS Dent. His mission is ‘Helping People Understand Economic Change’. As a former strategic consultant at Bain & Company, Dent’s analysis states that demographic trends are the greatest drivers of our economy, along with radical new technologies, working together to follow a four-stage life cycle of innovation, growth, shakeout, and maturity. Since 1992 he has authored two consecutive best sellers The Roaring 2000s and The Roaring 2000s Investor (Simon and Schuster). In his latest book The Great Depression Ahead(Free Press), Harry Dent offers portfolio allocation strategies during an economic crisis, as well as the bad news that the worst of the housing downturn will occur between 2010 and 2013. Harry Dent also publishes the HS Dent Monthly Economic Forecast newsletter.
Harry Dent’s newest book:
With incisive critical analysis and historical examples, this book lays bare the traditional assumptions of economics. Dent shows that the government doesn’t drive our economy, consumers and businesses do; that the Fed does not create most of the money in our economy, the private banking system does; and that the largest generation in history is now saving for or moving into retirement, meaning slowing growth. This is the new normal! Our banking system borrowed to lend for the first time in history with unprecedented leverage and debt levels of $42 trillion, way beyond the massive government debt. But the government’s promises and unfunded liabilities take the cake, at an estimated $66 trillion and growing!
These massive debts will have to be restructured in a time of slowing spending, and this means a deflationary crisis, which is very different from the inflationary crisis of the 1970s and requires very different personal, investment, and business strategies. Dent and Johnson outline these strategies in very practical detail. In the coming years, the greatest surprise will be that the U.S. dollar becomes the safe haven and appreciates just when everyone is calling for it to crash, while the gold and silver bubbles burst along with the stock and commodity bubbles. And real estate will see another round of declines just when everyone thought it could go no lower. The Great Crash Ahead is about making smart, cautious investments—avoiding the sort of high-risk, high-profit investment schemes that sank the world economy.
The road to recovery will be filled with challenges and will require massive change, such as debt restructuring, plans for greater employment, the restructuring of social welfare programs such as social security and health care, budget cuts, and higher taxes—in short, a revision of the kind of lifestyle that characterized the “Roaring 2000s.” The good news is this process will eliminate tens of trillions of dollars of debt and can make way for growth again as the echo boom generation ascends. Or we can continue on our present course and end up like the Japanese, with no growth and high debt two decades later.
“Dent brings more very convincing analysis on the unbearable debt that is weighing down the US and world economy. But more important, he brings the unique lens of demographics to show how the Fed’s stimulus plan is doomed to fail with the rising savings and slowing spending of the massive Baby Boom generation. A must read book for prospering in the inevitable debt crisis ahead.”
–John Mauldin, 4 times New York Times best selling author of Endgame and financial newsletter publisher of Thoughts from the Frontline and Outside the Box
“I have watched Harry Dent’s unique demographic approach to the economy and his forecasts for over 20 years. He has seen most of the key economic changes way ahead of most. In fact, he forecast the current economic crisis 20 years ago! He has spoken at many of my events around the world and has helped many prepare for the unprecedented economic challenges we are facing today. But perhaps the best thing about Harry is his very human, understandable and common sense approach to economics.”
– Anthony Robbins, Entrepreneur, Author and Peak Performance Strategist
“You can’t accuse Harry Dent of being a wimpy thinker. His new book is full of confident analysis and bold predictions. Whether he will be right about all of it, who can say? But his core theme is fascinating and provocative; his book is a delight.”
–William Bonner, President and CEO of Agora Inc.; author of Dice Have No Memory and Empire of Debt