Posted on 09/08/2011 8:24:13 PM PDT by JDW11235
Dear Freepers, please help me out! A firend of mine sent me an e-mail which featured a link to someone who is apparently an economist names Harry S. Dent, with a video ink (I'm including). I have never heard of this man, and I began to watch the video, in which he defines what he think is going on with the economy.
Thus far (I have only watched about half), all I can gather is that he believes that we are headed towards DEFLATION and that all commodoties are in a bubble and that whenever their is a crisis, people will run back to the U.S. dollar. He refers to this as "Running back to daddy." He also thinks there will be a massive drop in the price of P.M.'s and a Dow Jones of 3-4K in the near future.
This having been said, I agree with a lot of the data he has presented, but virtually non of his conclusions, with the exception of a continued drop in housing (history and logic favors that conclusion). But it seems like he is leaving out a myriad of information and variables such as other countries calling to drop the dollar, the other factors (flooding, fires, ethanol, etc.) in the rise in food commodities, and the fact that banks and persons are holding onto P.M.'s. I think this person is not credible in his conclusions, but wanted to know more about him, or any other's anaylsis of the presentation. Please help, if you have the time and desire. Thanks.
http://www.hsdent.com/video/index.html
It is a challenge to out guess the market. All you can do is get as much information as you can and find all the common threads and pull them in, assess them and make a informed decision.
Most of the people are pessimistic so field their reasons and their stories.
The safest place to be though is in the fatherland, the US of A as it offers the greatest stability, greatest philosophy and the greatest pool of talent on the world. If there is a adjustment, everyone will be hit harder than the US as it s far more resilient.
My bet is that the obama risk factor will continue to shut down the economy as he has NO idea nor experience. Worse than that, his mandate is to shut the economy down. Once he is out, optimism and confidence WILL return to the market and America will proceed again.
You’re going to find respected economists on both sides of this. I personally expect to see inflation before deflation, but what do I know? And, hey, if it were that easy to be so certain of the future, just think how boring life would be.
Supposedly, the secret is “diversification” — which simply means to develop a portfolio that will leave you equally devastated under either inflation or deflation :)
You bring up an excellent point, money doesn’t even have to be printed anymore. I once read (years ago), that if a collapse ever took place those with physical cash would be better off, because the electronic cash would go non-existent. I’m inclined to believe in that cash, U.S. dollars would still not be worth anything.
“Supposedly, the secret is “diversification” — which simply means to develop a portfolio that will leave you equally devastated under either inflation or deflation”
That made me smile. I personally don’t like to tie up money, investments, where I may never have access to them again, these days the stock market can really be a gamble, depending on sudden changes in policy, etc.
I like your optimistic point of view. I think we’ll have some hard times ahead, and I don’t think they will end with Obama. The system the Founding Father’s set up has gone off course, extremely, there is no accountability. There are so few U.S. reps, that no one is represented (well lobbyists are). The legislatures no longer appoint senators. Both of these affect impeachment and SCOTUS confirmations, there’s a lot of changes to be made, but a change in the Presidency will be at least a breather.
“Between two economists you’ll get three different opinions...”
If one had converted $30,000 to gold when gold was at $300, he would have one hundred ounces of gold.
Today, with gold at $1800, one can pay off a mortgage of $180,000 with those coins.
If you believe those who point out that "gold IS money", then, deflation is occurring. What once required six hundred ounces of money to pay now only requires one hundred ounces.
I see little chance that our government will ever find a solution to having debts and unfunded obligations approaching perhaps 100 trillion dollars. They could fail to pay four out of five of those dollars and STILL have to print plenty of money.
I foresee incredible increases in black-market transactions (that is, hidden from the tax man) and a growing acceptance of "money" other than dollars. At the same time, there will be hordes of tax-collectors assigned to investigate and prosecute the perpetrators.
Wow, you bring up some excellent points. And you hit very close to home when you talk about gold being money. In my current home/state (Utah), gold and silver are officially money as of the last legislative session. Idaho to the North is also making advances on that front. The IRS will tax anything they can, which is why we need to fight (and repeal) the income tax with all we’ve got. Everything is now “Income.”
Thank you for both posts, I look forward to reading them!
I wouldn't pay any attention to anyone who tries to scare you about "deflation". Doesn't know what he's talking about.
Why would inflation (in the terms of a dollar’s weakened purchasing power) ever be a good thing? I know there are a lot of definitions of “inflation,” but I’m not sure I understand what you mean. As far as I know, assuming that supply can keep up with demand, technology and innovation, over time, reduce the price of goods (as they become less costly to manufacture). Doesn’t that mean that a rise in price with a stable currency (ours obviously not being an example, currently, but once was more so), shouldn’t happen, or am I missing something? But that’s also why I’m not really worried about deflation, I just don’t see it happening.
(My background is not in economics, though I am learning now).
And I forgot to say “thank you,” for taking the time to help me understand better, so, thank you!
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