This isn’t something you’re going to hear from the mainstream media or any financial news outlet. In fact, this is something most economists in the U.S. choose to ignore.
That’s because, according to bestselling author and Harvard-educated economist Harry Dent, most don’t understand the most important factor in our economy: “People… or more specifically, demographics,” he says.
Dent has spent decades analyzing spending trends, economic cycles, and accurately forecasting major financial events like… the roaring bull market of the 90s, the dot-com crash in the early 2000s, the 2007-2009 financial meltdown and oil’s shocking fall in 2016.
Today he’s passionately talking about our economy’s strongest indicator of health, which goes hand in hand with his research into demographic trends, and what it now says about the direction we’re headed very soon.
No, he’s not talking about GDP, income, employment, interest rates or even stocks.
Dent firmly believes the biggest evidence of a potential crash lies in the real estate market:
“The leading economic indicator isn’t the stock market. The stock market can go to more extremes, because most people don’t own a lot of stocks, and the stock market doesn’t affect them or their jobs nearly as much as real estate, which affects people directly.”
Dent says this bubble is more dangerous than any we’ve seen in the past, because of the constant stimulus and quantitative easing being pumped into the economy.
“Back when these bubbles started to crash in 2007, central banks stepped in printing money – now up to $15 trillion and still rising – inflating the bubble, buying back stocks and more… all creating an “artificial” bubble, which will make the burst even worse this time around.”
“In this era, and unlike any time in history, there is no end to how much governments and central banks are willing to stimulate to keep this bubble going, because they know just how bad it’s going to be when it bursts,” he says.
But according to Dent, central banks are creating bubbles that are completely unsustainable, and when it comes to real estate, there are limits… and the cracks are becoming more visible.
“When the real estate market bubbles up and it becomes unaffordable to buy and less affordable to rent… and when the government has to reverse their zero-interest rate policies and mortgage rates go up, this bubble will burst.”
With prices and higher mortgage rates already starting to turn off buyers right now, this will be the FIRST bubble to work against this bubble economy and say “there’s a limit to all this.”
Looking back to 2006, this is exactly what led to the downturn, when prices peaked, starting declining slowly until they plummeted.
But while the subprime lending fiasco caused the bubble to start bursting on the low end with defaults and foreclosures, “this endless stimulus will lead to a much greater burst this time around, with the real estate market on the high end,” says Dent.
Regardless, in both scenarios real estate is just the first domino to fall, ushering in the next downturn, and this bubble is just a symptom of a larger problem that lingers just over the horizon… which will eventually include stocks.
“You need to get your strategy straight personally, and in your business to consider how you’ll make money and survive in this downturn ahead,” urges Dent.
Not many people were ready for the Great Recession in 2007 before it hit, but here’s your chance to prepare now while you still can because the warning signs are clear.
Harry Dent has all the details about what’s right around the corner in his latest book, Zero Hour: Turn the Greatest Political and Financial Upheaval in Modern History to Your Advantage.
Inside this playbook guiding you through “The Great Reset,” he gives you all the tools you need to prepare and survive as the world we know is turned upside down.
This book is all about leading you through the revolution ahead and helping you understand what drives economic growth and decline, so you know exactly what to expect in the months ahead.