Manage episode 299152868 series 1537109
Are we heading for the biggest crash since the Great Depression?
Is it just around the corner?
Well according to Harry Dent, we are and it is.
He is telling anyone who is prepared to listen that we are heading for a stock market crash, and the value of your house will drop by up to 40%.
Today I to chat with economist Harry Dent about his views, and then Pete Wargent and I give you our thoughts on what’s ahead.
Now a word of warning before we get into the interview, especially for the faint hearted. There are some scary predictions made by Harry, so please listen to his whole interview and don’t sell up your assets before you have my views and those of Pete Wargent.
Subjects I Discussed with Harry Dent
Harry is a Harvard MBA graduate, a Fortune 100 consultant, and his demographics-based approach to economic forecasting has helped him correctly predict many major economic events, including Japan’s 1989 economic collapse, the 2000 dot-com bust, and the populist wave enabling Brexit and Donald Trump’s election.
- Harry believes that an economic winter is coming that will be worse than the Great Depression.
- He believes that the governments are using stimulus to keep economies alive, and that this is bound to not end well.
- Harry’s biggest surprise about COVID was how much the governments stepped up and created stimulus.
- He believes that the biggest sign of problems in the US is that the home sales are going down while housing prices go up.
- He believes that rates are artificially low because governments are printing money out of nowhere and using it to do things like buy bonds.
- His line in the sand is 2022, which is when he believes the lowest point will occur.
- Harry says that hitting the limits wall cause the bubble to explode.
- He says that China has the biggest bubble, and because they’re Australia’s biggest export, their bubble bursting will hurt Australia.
- Harry believes that Australians who think he doesn’t understand Australia’s markets just don’t understand the world.
- He would advise people to reassess their assets and sell what they don’t need.
- Harry explains that the upside of a burst bubble is that it will get rid of bad companies being artificially propped up and make way for new ones.
- Harry also discusses how he would explain his views to someone who visited his seminars and did what he suggested years ago but didn’t see it work out for them.
Bursting the Bubble with Pete Wargent
- According to Pete Wargent, we’re not in a bubble, and there isn’t necessarily a big explosion coming
- Australia is seeing record-low mortgage rates
- A typical response to low mortgage rates is more people getting into the housing game.
- More people getting into the housing game is basically what is happening right now.
- The current housing market is underpinned more by owner-occupiers than investors
- This makes a bubble less likely.
- Australia’s government has been prudent, and there are not high levels of government debt.
- What’s more, the interest rates are low.
- Australia’s banking system is sound.
- The majority of the debt is in the hands of people who have the means to service it.
Harry Dent’s newsletter: www.HarryDent.com
Pete Wargent’s new book Low Rates High Returns
Shownotes plus more here: Harry Dent says Australia’s property bubble will burst, but Pete Wargent bursts his bubble
Some of our favourite quotes from the show:
“As an investor, I believe it’s important to listen to others views.” – Michael Yardney
“In my mind, a bubble is an economic cycle characterized by a rapid escalation in asset values, then it’s followed by contraction.” – Michael Yardney
“From what I can see, the debt that’s out there is in the hands of people who can manage it.” – Michael Yardney
PLEASE LEAVE US A REVIEW
Reviews are hugely important to me because they help new people discover this podcast. If you enjoyed listening to this episode, please leave a review on iTunes - it's your way of passing the message forward to others and saying thank you to me. Here's how