I go online to check Yahoo Finance everyday to see how the stock market and other markets are doing.  I try to stick to the numbers and real information, and avoid the headlines and articles most of the time.  But, about a week ago this was the headline that couldn’t be missed.

Economist Predicts: “The Greatest Stock Market Collapse since the Great Depression”.

Talk about a bold prediction.  And the picture associated with the headline was the most intriguing part for me.  It was the one and only Harry Dent.  Although his name and actions are similar, don’t get him mixed up with Harvey Dent, the 2 face villain in “The Dark Knight”.   Obviously this caught my eye, so laughing I clicked on the link and it took me to the article.   This is where it gets comical.

This is the first paragraph…

“The man who called nearly every major economic trend over the past 30 years…including the 1991 recession, Japan’s lost decade, the 2001 tech crash, the bull market and housing boom of the last decade and, most recently, the credit and housing bubble has issued a startling new prediction.” 2.

The man they are talking about, Harry Dent, is the same man who in 1999 wrote the book “The Roaring 2000’s, which predicted the greatest boom in  the US stock market history.   Just so you know, from 2000-2009, the annual return of the US Large Stocks was -0.95% per year.  Nice try Harry! 1.

Then in 2009 (yes, after the crash of 2008) wrote a book entitled, “The Great Depression Ahead”…   Speaking of which, the US market has bounced back in an incredible way and has yet to have even a down year since the book came out.

The filth continues…

“In fact, Dent says, “We’ll see a historic drop to 6,000… and when the dust settles – it’ll plummet to 3,300. Along the way, we’ll see another real estate collapse.  Gold will sink to $750 an ounce and unemployment will skyrocket… It’s going to get ugly…  This is not fear-mongering. This is today’s economic reality” 2.

If this is not fear mongering I don’t know what is.  Any investor who reads this junk has fear and panic running through their blood.  This is so detrimental to the investor.  We all know that diversified portfolios that are prudently invested in multiple asset categories will get you great returns over the long term.  It was at this point of the article that i started thinking, why would anyone write this article and put so much fear into investors.  Then I read this.

“He says those who position themselves accordingly beforehand could have the opportunity to earn millions through specific “decline-related” investments year after year, over the next decade as well as maximize the next long-term “boom cycle,” which he predicts will begin between early 2020 and late 2022.  The controversial video, initially released to a private audience, has gone viral as hundreds of thousands are seeing new evidence for a looming economic crisis, and are heeding Harry Dent’s advice to survive and prosper.” 2. 

Wow, that is the worst investment advice ever given.   Harry Dent is in the business of making money off of peoples fear and greed.  The more fear he can put into the investors, the more money and fame he will get.

I advise you to stay away from the fortune tellers of Wall Street.  Nobody, especially Harry Dent, has a crystal ball.  Don’t fall for the headlines that are only there to sell you on emotion of fear.  Fear is a powerful emotion that can take over an investors mind.  Don’t let it.

By Jimmy Hancock

References

1. Matson Money. MOM Powerpoint. Mason, OH: Matson Money, 9 Jun. 2015. PPT.

2. Economy & Markets Daily. “Economist Predicts: “The Greatest Stock Market Collapse since the Great Depression”.” Economist Predicts: “The Greatest Stock Market Collapse since the Great Depression”.Economy & Markets Daily, 8 June 2015. Web. 09 June 2015.