The Great Depression Ahead part 1

The Perfect Storm: Peak Baby Boom Spending Collides With Peak Oil/Commodity Prices in 2009-2010

On the basis of predictable demographic and technology cycles, Harry Dent has forecast since the late 1980s that the economic boom would be greater than previously thought and would last until the end of the current decade. Dent has been one of the most bullish forecasters for decades, standing virtually alone in forecasting the great bull market of the 1990s in his book The Great Boom Ahead (1992). Now he is calling for an end to this great bubble boom, after revising his forecasts downward for U.S. stocks in 2006 as a result of the increasingly adverse geopolitical cycle and rising oil/commodity prices. In all of his past books since 1989, Dent saw an end to the Baby Boom spending cycle around the end of this decade. Harry Dent forecast the housing slowdown years before it occurred and sees the minor recession of 2008 as the beginning of a greater stock crash and depression to unfold between 2009 and 2012, with the worst crash for stocks and housing likely between late 2009 and mid 2011. Home prices will continue to decline into late 2008 and then will likely experience a minor rebound in early to mid 2009. However, rising inflation, interest rates and a last commodity bubble will bring a final blow to stocks, the economy, housing, and even the greater emerging market bubble in stocks overseas.

Between mid to late 2009 and mid to late 2012, the U.S. will see the next Great Depression and the deflation of the “three bears,” bubbles in stocks, housing, and commodities. This occurrence will represent the de-leveraging of the greatest credit bubble in history and will have much greater effects than we have seen thus far on banking and financial systems. Americans will see the first and last “Great Depression” of most of our lifetimes. Most people simply are not prepared for this coming dramatic change in our economy. Aging Baby Boomers will see the worst of the economy in their retirement years, much as the Bob Hope generation saw the worst in their early years in the 1930s and in World War II on an 80-year generational cycle.