America's Bubble Economy: Profit When It Pops [Hardcover]

David Wiedemer (Author), Robert Wiedemer (Author), Cindy Spitzer (Author), Eric Janszen (Author)

Book Description

Publication Date: October 6, 2006

America’s Bubble Economy is the first book to focus on several simultaneous financial bubbles that are interacting to temporarily boost—and ultimately threaten—the United States and world economies. Filled with expert analysis and straight talk, this book will show you how to turn the coming economic transformation into a once-in-a-lifetime wealth-building opportunity.

Editorial Reviews

Review

WORRIED ABOUT THE HOUSING BUBBLE? You should be, but don't let it monopolize your agita. There are four other bubbles also deserving of attention, according to America's Bubble Economy: a stock-market bubble, a foreigner-supported-dollar bubble, a consumer-debt bubble and a U.S.-debt bubble. When the five collide in a "bubblequake," the book's authors predict, the air will rush out of the pumped-up U.S. economy, deflating the average American's assets and standard of living.
But not to panic. America's Bubble Economy has a subtitle: Profit When It Pops. Eric Janszen, one of its four authors, suggests keeping 10%-15% of your assets in gold, which he sees rising "to a peak price of $2,500 to $3,000'' an ounce. Janszen et al. also recommend eurobonds and euro-denominated exchange-traded funds, because most of Europe isn't as indebted as the U.S. and its main currency should outperform the dollar.
A former venture capitalist and founder of the financial Website iTulip, Janszen says the U.S. is repeating errors of the Nixon era, including massive government deficits, under-funded entitlements and an unpopular war the government can't fund with higher taxes or special bonds. Throw in today's growing global demand for commodities, and "... all roads still lead to inflation, whether due to energy costs, unfunded deficits or dollar-currency risks," he says.
Janszen, who was rightly skeptical of the Internet craze early-on, tells Barron's that the current stock-market bubble is "a reflection of monetary inflation" rather than future earnings. A more normal trendline, he says, would put the Dow at about half its present level, or 6,000. Now, that's something to worry about.
—Susan Witty (Barron's, November 13, 2006)

Chosen by Kiplinger’s as one of the 30 Best Business Books of 2007

Paul Farrell, Senior Columnist at Dow Jones MarketWatch said on February 12, 2008, "In short, America's Bubble Economy's prediction, though ignored, was accurate."

Review

"More roadmap than crystal ball, this book doesn’t simply advise a reader what’s coming, it tells a reader exactly how to plan and respond. That it manages to predict an awfully troubling near future while still managing to be readable and even funny in spots, is no mean feat."
—Ken Kurson, co-author with Rudy Giuliani of the No. 1 Bestseller Leadership and financial columnist at Esquire

"A sobering financial wakeup call for all Americans."
—C. Thomas McMillen, Rhodes Scholar and former three term U.S. congressman

"Whether you think it goes too far or hits a bull’s eye, America’s Bubble Economy presents a riveting argument for what may be coming and how to make the most of it."
—Philip J. Gross, former CFO, America Online

"Sound advice in these times, America’s Bubble Economy delivers what we need to hear. Its prognosis may be harsh, but these insights are astute, logical and compelling."
—Dr. Rodney Stevenson, Professor of Business, University of Wisconsin-Madison, past president of the Association for Evolutionary Economics

"Finally, a way to profit from the government’s reckless spending habits!"
—Jim Goldinger, Managing Director, TD Capital Ventures

See all Editorial Reviews

Product Details

• Hardcover: 288 pages
• Publisher: Wiley; 1 edition (October 6, 2006)
• Language: English
• ISBN-10: 047175367X
• ISBN-13: 978-0471753674
• Product Dimensions: 9.1 x 6.3 x 1 inches
• Shipping Weight: 1.2 pounds (View shipping rates and policies)
• Average Customer Review: 3.9 out of 5 stars  See all reviews (39 customer reviews)
• Amazon Best Sellers Rank: #133,460 in Books (See Top 100 in Books)

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Most Helpful Customer Reviews

123 of 142 people found the following review helpful:

2.0 out of 5 stars Basic ideas would fit in one chapter. Poorly edited., November 20, 2006

By 

Bstone "BStone" (Boston) - See all my reviews

This review is from: America's Bubble Economy: Profit When It Pops (Hardcover)

You can give this book a pass. There's really nothing to it, so save your money. While one might agree wholeheartedly with its premise and conclusions, the exposition here is not the best. For comparison, take a look at Stephen Leeb's Chapter 5 in his "Oil Factor" of 2004 and you will see a much cleaner more informative discussion of just about everything in the "Bubble" book. Leeb is far more succinct and authoritative and manages to avoid what is becoming the most overused word in the language -- "bubble." And he does it in 11 pages.

The investment advice in this book, once you get past all the padding, is to buy gold and euros. The advice on gold at least comes with a cursory analysis of the supply and demand situation, but the advice on the euro is given without support. There's no discussion whatsoever of the economic realities facing the European Union and how they might impact the dollar/euro exchange rates. I'm not saying there isn't a good reason to run to euros, just that it appears nowhere in this book.

One of the other reviewers was as annoyed as I was about the poor editing in this book. In addition to misspelling Warren Buffett's name numerous times, including in the index, there is a general carelessness that made reading each chapter a hunt for mistakes. I expect more from Wiley.

If this is your first exposure to discussion of the multiple problems facing our economy from housing prices, government debt, consumer debt, and foreign exchange risks, it may serve as a readable introduction. However, don't expect too much depth and be prepared for typos and misspellings. A two star rating is pretty generous.

26 of 27 people found the following review helpful:

5.0 out of 5 stars quick, interesting read, October 11, 2006

By 

john jameson (nj, usa) - See all my reviews
(REAL NAME)   

This review is from: America's Bubble Economy: Profit When It Pops (Hardcover)

It's a quick read -- big type, cartoons and relatively simple concepts cut it down to one or two evenings -- and not too brain-bending ones at that. The authors feel quite confident about their points, and present them swiftly, without delving deeply into statistics or high-level economics (most points take a common-sense, "when x people do y with z, z goes up or down" approach...often with heavily simplified charts and graphs to illustrate).

If they were trying to sell me on a massive investment plan to get-rich-quick right now, I wouldn't feel sufficiently convinced by their approach. But they're not -- this is a practical guide to a possible future scenario: if the Dollar tanks, and tanks big (and the first half discusses the reasons why that's likely sometime in the coming years), they present sound advice as to what to do with your investments; and, in light of that, what you may want to do with some percentage of them now, as a hedge.

While this isn't Eric Janszen's (of predicting-the-internet-bubble-burst fame) book (he only provided one chapter), the authors' philosophy mirrors that of his "iTulip" Web site -- if you find it intriguing, this will provide background and practical applications. If they're right, and you play it well, things will go very well for you. If not -- even if their reasoning is wrong, their recommendations belong in a well-balanced portfolio at times, anyway.

In-a-nutshell contents:
1) Active bubbles (overinvested sectors, most especially the American currency itself) at play in the American/world economies -- how they formed, how big they are, and what happens if they deflate in tandem
2) What sectors would survive or thrive in the several-year global recession that would result
3) A somewhat tangential last-chapter on the likelihood of the global electronic markets someday evolving out of the current bubble-generating multi-currency morass into global monetary unit

Rather annoyingly, the hyperlinks referenced by the book (most sections have at least one "see x on our site for more information") are all dead at the moment -- but it's a new release, so hopefully they'll finish the site soon.

54 of 65 people found the following review helpful:

5.0 out of 5 stars Great book! Easy to read, sophisticated economics, December 28, 2006

By 

Concerned Investor (Houston TX) - See all my reviews

This review is from: America's Bubble Economy: Profit When It Pops (Hardcover)

In the 1930's, without any warning, a major hurricane roared in over the Connecticut and New England coastlines and wreaked havoc. The storm's horrific effects were multiplied by the fact that the weather experts had taken a conservative line and issued no warning - despite the best scientific evidence to the contrary. A financial storm of category 5 dimensions appears to be headed for the U.S. in the not so distant future. The real estate and stock market bubbles are due to pop, causing a dollar crash. Excessive consumer credit and governmental deficits of unprecedented dimensions will add to the fire. Based on sophisticated new economics, the book America's Bubble Economy gives us advance warning of the "bubble pop" before it happens - and in time to restructure investments not only to weather the storm, but to profit from it. Fortunately, the book does not attempt to be a long, drawn out hyper technical academic treatise. It is easy to understand, has clear logic, and is not overly complex. However, the book has more depth than the surface writing would make it appear. For example, some books on the dollar crisis, or prospective crashes, predict a depression along the lines of the 1930's. Modern economists are unlikely to repeat the mistakes of the 1930's and restrict the money supply in the face of a major downturn. Instead, they will likely increase the money supply dramatically which will produce inflation in response to a major downturn. It will not be a classic depression composed of excess production and labor capacity which was deflationary in the 1930's. The book explores a future downturn from the bubble perspective, based on deeper historical insight into the nature of bubbles, rather than a simple depression model. It leaves the reader with little doubt about the need for investment restructuring to deal with a bubble pop situation. It gives tell tale warning signs to be on the look out for and lays out a clear path as to how the bubble pop will likely occur. While a lot of financial analysis revolves around what not to put money into, this book gives clear and positive investment actions to take to weather the storm, such as purchasing gold. It even gives interesting insights on the future of foreign exchange and the nature of the changes the "bubble pop" will cause. There may be rays of hope and much better weather after the long storm ends - it will be a much more global and electronic economy than today. Don't let the book's easy reading characteristics fool you - the economics behind this book are very sophisticated. In any event, when dealing with future events, high precision is hard to obtain. We can predict for sure that it will snow this winter in Colorado, but it's hard to predict on exactly what minute of what hour, of what day the first snow will occur. We can predict an economic hurricane in the next few years in the form of a bubble pop, but it's hard to predict the exact time and location of its landfall. This book takes the excellent approach of describing the forest without getting lost in describing too many trees. This book is an essential addition for the library of any reader who seeks to understand and prepare against a future collapse of America's housing, stock, and dollar bubbles, and their interaction with the rest of the economy to produce a truly historic bust.

Concerned Investor