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The Great Crash Ahead
Old 11-08-2011, 07:29 AM   #1
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The Great Crash Ahead

Hello everyone. I'm reading a book by Harry S. Dent, Jr. named: The Great Crash Ahead (Free Press, 2011). In it, the author makes a compelling case regarding the baby boom generation demographic and how it will naturally cause upheaval in the stock market as the baby boomers shift from spenders to savers in preparation for retirement. He, rightly in my mind, outlines why the Fed will be unable to reinflate the economy because baby boomers are shifting into savings mode now that their children are leaving the nest. I rarely hear economists mention demographics when discussing macro economics. Does anyone have any thoughts on the notion or Mr. Dent as an author or economist? TIA
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Old 11-08-2011, 07:48 AM   #2
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He is the same idiot that predicted DOW 40,000 a couple of years ago. Just another fear mongerer out there trying to make a buck.
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Old 11-08-2011, 08:01 AM   #3
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Wasn't Harry S. Dent a porn star before he started writing for the National Enquirer?
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Old 11-08-2011, 09:30 AM   #4
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Originally Posted by emi guy View Post
Hello everyone. I'm reading a book by Harry S. Dent, Jr. named: The Great Crash Ahead (Free Press, 2011). In it, the author makes a compelling case regarding the baby boom generation demographic and how it will naturally cause upheaval in the stock market as the baby boomers shift from spenders to savers in preparation for retirement. He, rightly in my mind, outlines why the Fed will be unable to reinflate the economy because baby boomers are shifting into savings mode now that their children are leaving the nest. I rarely hear economists mention demographics when discussing macro economics. Does anyone have any thoughts on the notion or Mr. Dent as an author or economist? TIA
Baby boomers have already started retiring. Doesn't take a rocket scientist to say "If the baby boomers have not already shifted from spending to saving, there will be upheaval". That is true on an individual basis, regardless of what Dent says.
The baby boomer demographic doom and gloom thing has been around for a while.
Last couple of years, I spoke with a financial planner who was a Dent follower. Always worries me when "extremes" are touted as in "all or nothing". He was moving all his clients money to Treasuries. How did that work for him do you think? Had I listened and followed him....I would have been out $50K the last year.

As in everything with investing...diversification of assets and tax alternatives is key.
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Old 11-08-2011, 10:05 AM   #5
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The impact of Boomers on the economy has been overrated, IMO. It wasn't that long ago when people were expecting very low unemployment starting around 2010 as the Boomers started retiring in huge numbers and there weren't enough younger folks to replace them.

Oops.
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Old 11-08-2011, 12:21 PM   #6
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Time to panic. Jump off the roof now before the lines get too long.

John Greaney has referred to Harry Dent's demographic predictions. I can't say that he is wrong, but I am not betting on him.
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Old 11-08-2011, 12:36 PM   #7
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Seems to me most baby boomers are done with their saving and now are moving into the decumulation phase. As for Dent, he is a sensationalistic kook IMO.
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Old 11-08-2011, 01:08 PM   #8
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According to Wikipedia, he advised the Dent Strategic Portfolio Mutual fund, but I can't find it on Yahoo Finance. There is a 2 year old Dent Tactical ETF (DENT), but 2 years is too little time to see if his performance is any good. FWIW, it is behind the indexes.

A number of authors have written about the demographic changes in their attempts to forecast the future or at least weight the various possible outcomes. I am reading John Mauldin's EndGame which I find to be very well researched.
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Old 11-08-2011, 01:22 PM   #9
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Seems to me most baby boomers are done with their saving and now are moving into the decumulation phase...
Hey, I represent that remark (as an early boomer).

No need to save anymore - at least in my case.

Rather than save, I'm stimulating the economy ...
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Old 11-08-2011, 04:55 PM   #10
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Hey, I represent that remark (as an early boomer).

No need to save anymore - at least in my case.

Rather than save, I'm stimulating the economy ...
Thats how I used to justify new car purchases to DW, I'm stimulating the economy
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Old 11-08-2011, 05:02 PM   #11
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Are these the very same boomers that I hear haven't saved but a fraction of what they need to retire on, and are all going to keep working until they're dead much older than anticipated?

Dent defends his 40,000 Dow prediction by saying something like, "I got the super-duper bull market part right, but just not the duration/intensity". Yeah, okay.

Doom & Gloom sells books, and that's about all it's worth. There is always some doomsday scenario, most of which aren't right, all you have to do is guess which one is correct.
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Old 11-08-2011, 05:49 PM   #12
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Ten years ago, I kept reading that the baby boomers were all going to inherit millions from their parents (whose 1958 houses would be worth 20X what they paid for them) and by 2010, would drive the price of vacation homes sky-high.

Ooooh, those baby boomers. Never ones to do what's expected of them, sigh.

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Old 11-08-2011, 06:50 PM   #13
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Computer made it through the Y2K with very little disruption. I think that this will be about the same type of news event.
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Old 11-08-2011, 07:01 PM   #14
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I'll be in the Paul Farrell Doom Bunker, attempting to assemble complex and highly sophisticated protective equipment.
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Old 11-08-2011, 07:16 PM   #15
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I am still waiting for global winter, riots and martial law in the cities and a huge shortage of food right here in North America. All were predicted in the 70's.
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Old 11-08-2011, 07:20 PM   #16
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Or, how about the war with Japan?

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Old 11-08-2011, 07:37 PM   #17
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Computer made it through the Y2K with very little disruption. I think that this will be about the same type of news event.
At the time of Y2K, I was doing enterprise database backup and recovery software tech support for many Fortune 500 customers. At one point, around October 1999 I think, the team was setting up its next 3-month rotation for the 24x7 "on call" duty (we did a week at a time with the pager glued to our belts). The topic of the week in the Y2K changeover came, and no one wanted it. Finally our manager offered someone two days of extra paid time off to take it, and I cautiously accepted. (Back then the economy was hot and they had to offer carrots instead of the sticks they give today.)

It was the easiest week of on-call duty I ever had there; I only had one relatively minor off-hour/weekend call when there were usually 8-10 in a week. Usually the problems occurred when people were doing maintenance and recovering a backup from one server to install the database on another, and everyone was so afraid to touch their systems that week so nothing happened in that vein.
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Old 11-08-2011, 10:07 PM   #18
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The so called baby boom crash is not a secret and has been discussed for years. This is nothing new. I am sure I heard it mentioned at least five years ago. This reminds me of those people who write about 'secret' books of the Bible. They are referring to certain texts that can be found on the library book shelves of any good school of Theology. Nothing secret about them. They are simply unknown to the general public. Big deal. I think the Baby Boom Bust theory is the same thing. Nothing secret, just not well know.
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Old 11-08-2011, 10:34 PM   #19
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I watched the video that was about 8 minutes long. I almost bought the new edition of the book with the extra chapter not in the original book. The amozon reviews were nediocre in that he kept discussing the same things over and over, I did not buy the book. I probably saw it all on the video.

Don
t get me wrong, I tend toward the pessimitic side for our lonng tern future,
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Old 11-08-2011, 10:37 PM   #20
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Or, how about the war with Japan?

Change the title to China, and you got a book that has amuch higher probability of happening. JMHO
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