Harry Dent, founder of HS Dent Publishing, an economic forecasting and investment research firm and publisher, says the biggest financial recession ever will be this year, and investors are taking the ‘biggest risk of their lives’ if they don’t sell before it completely destroys the market. According to Harry Dent, all assets, including gold, are at risk. The famous name’s evaluations of the markets and the ‘great collapse’ predictions cryptocoin.com compiled for our readers.
“The big collapse will be due to the ‘biggest bubble in history’ of financial assets with the effect of the Fed”
Harry Dent is an economist and author of ‘Zero Hour: Turn the Greatest Political and Financial Turmoil in Modern History to Your Advantage’ and author of his latest book, ‘What to Do When the Bubble Pops: Personal and Business Strategies for the Coming Economic Winter’. It bases its economic forecasts on demographic changes.
Harry Dent says that risk assets will be sold in waves, with the first wave US stock markets dropping as much as 40% and the entire bear market phase totaling up to 1. Unlike what happened to tech stocks during the 1999 Dot Com Bubble crash, the S&P 500 That means 90% loss. The economist makes these ambitious and frightening predictions:
This will be the biggest crash and the biggest setback of your life, and most will likely happen in 2022. The entire collapse will be between 80% and 90%, and the first collapse will be between 40% and 55%. It will happen so fast, you won’t see it. So if you wait to see if I’m right and you take that risk, you’re going to be hit very, very hard, and history is very clear on that.
This collapse, according to Harry Dent, will occur largely because financial assets are the ‘largest bubble in history’ caused by excessive stimulus by the Federal Reserve:
It’s one thing if it’s a natural bubble, but when regulated by central banks there’s no way to predict exactly (timing).
“All assets, including gold, are at risk!”
Harry Dent’s comments came as the Fed released minutes of its meeting Wednesday, stating that “the appropriate rate of balance sheet flow will likely be faster than during the previous normalization period” as asset purchases begin to decline this year. Stock markets reacted negatively to the news, while Treasury rates rose. Harry Dent says this market correction in 2022 should be followed by a recovery with a larger boom cycle led by the millennial generation. The economist continues his disaster predictions in the following direction:
I predicted the next boom would forever be millennials from 2024 to 2039, not quite as tall and not as steep as the Baby Boomer boom, but we’ll see another boom to follow in the US and more in Asia , especially now in India and China and Southeast Asia.
According to Harry Dent, all assets, including gold, are at risk, although Treasury bonds should benefit most from deflation in asset prices. “If you want to do a great job, you buy a 30-year Treasury bond, and it can go from 40% to 50%, and it happened in 2008,” says the Economist. In addition, Dent makes a distinction between the hedging properties of gold and Treasuries:
In an inflationary conclusion, gold is the ultimate inflation hedge. Treasury bonds, top quality bonds, are hedging from eventual deflation.
Stating that the collapse in financial assets will not be triggered by an economic downturn, the Economist thinks that a market collapse will accelerate the recession:
When people start selling these financial assets, wealth is lost and people panic even more, which causes recession. The financial asset crash actually triggers the recession that happened in the 2000 crash.
While Harry Dent sees most altcoins as a bubble at the moment, he notes that cryptocurrencies will be one of the assets to buy during the recovery phase in 2023 and beyond. The economist notes that currently its stock mainly includes cash and real estate.
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