203 of 215 people found the following review helpful
on January 12, 2014
This is a very significant book and I would recommend that everyone read it. Unfortunately, in my opinion, the author digresses significantly and often into topics for which he demonstrates very little expertise. I was frustrated and found myself skimming about 40 percent of this book as trash. The other 60 percent was very important and worth it at twice the price. Definitely a recommend, but with the qualification that you be patient and be willing to skip through portions of the book.
Mr. Dent does a fabulous job as a demographer and the work he shows is exceptional. He presents one of the strongest cases I've ever seen for future economic cycles...I think everyone should be armed with this evidence and decide how best to use it. I was so pleased with such a solid fundamental approach to the world's economic situation.
Now the bad:
Covers topics like sunspots' effect on the US stock market; paints inflation only in the context of dollar value vs. other currencies; delves into politics and oversimplifies (and misrepresents) the positions of various parties; discusses environmental disaster and mischaracterizes the science; He gets way too far into the weeds. He should have stuck with the primary thesis of his book.
I'm sorry if that sounds harsh, but this guy comes off as a know-it-all and quite narcissistic. I would fire the editor and publisher for letting this book go so far astray.
With the negatives said, the core of this book is fantastic and I expect the science behind his demographics is solid. I am quite glad to recommend this book and I am very happy that I purchased it. This book provides so much insight into the economic cycles and where we are headed from here for the next 20 years or so. I wish there was an abridged version that sticks to the primary topic so this book were more accessible to more people. Please buy the book, and try to overlook the negatives I've discussed above. Also, please read other books on this topic. I'm sure the author is right in the main, but I would be very careful about investing 100% of your portfolio in the manner he suggests. Still, food for thought and I'm glad I bought the book!! Enjoy.
144 of 159 people found the following review helpful
on January 8, 2014
I've always enjoyed Harry Dent but reminded myself to take him and other prognosticators in the realm of Armageddonomics with a grain of salt. This book is another detailed list predictions, albeit better researched than his other works and in the end, probably more accurate.
The author forecasts for the global economy with a focus on implications for America, particularly as we scrape through the current fiscal mess with 77 million baby boomers on the verge of entering what they thought would be their golden years. Dent does not spend time opining as to the root causes as to why demographic pressures have come to bear, be they social, political, religious or other normative variations, but he makes a detailed analysis of the alarming ice berg approaching world economies. Simply put, the birth rates of the most developed economies are being outstripped by their multiplying elderly population, and this will make for a smaller work force, less productivity and catastrophic economic impact that no population is prepared to accept. Everything from anticipated amounts that young consumers spend to the age at which they expect to retire is about to get a major readjustment, like it or not. He even claims that in Japan, adult diapers are outselling infant diapers. In another, he claims research shows that 35% of young Japanese men are no longer interested in sex out of paranoia of getting their wives/girlfriends pregnant and raising a child they cannot afford. I guess condoms are super-expensive in Japan nowadays. Um, ok; we get it, Harry, but unless that statistic can be backed up somehow it's really unnecessary and reeks of hyperbole.
One of my favorite takeaways from the book: "when dyers outnumber buyers" refers to his warning that this is the first time in the developed world that a smaller generation will be following a larger generation. Not sure if this is the first time in every case, but it is generally correct. And as Dent warns throughout the book, if we expect China to save the US from certain demise, think again - they face similar constraints, monetary policy troubles and unique population constraints.
I would argue that although this is true, China and other countries with strong central control have the advantage of being able to change course dramatically much more quickly than any Western democracy. Need to get rid of a few hundred thousand government workers and re-vamp your tax code? Good luck getting that past a Congressional sub-committee in the US, but in China it's a done deal - we'll have those offices cleared out in a week. It could be argued that the Western governments will exploit any such crisis just as eagerly, but the expectations of the Western populations are far in excess of that of the average Chinese factory worker or peasant. Regardless, Dent is correct that the USA can't expect another economy to save it from itself.
He details "spending waves" taken from US census data, again interesting but not entirely surprising, especially if you are wont to read books of this genre. The pig through the python concept has long been known to marketers and social planners alike for decades, yet even with this information we're headed to the demographic cliff, economically, absent major political intervention. Alas, an elected politician won't change what the voters don't want him to change.
The one part of the book where many people will disagree is the authors characterization of inflation - he says (with apologies to Milton Friedman), that it is not about monetary policy, but it is about people. He essentially argues that inflation is defined by rising prices, and rising prices are caused by young people, who spend more than older people. I don't want to go too far down this path, but rising prices are a symptom of inflation, not inflation itself. The prices rise because the value of the currency changes, which is a direct result of monetary policy (so, in that sense, it IS about people - the people making the monetary policy. Ok, let the flame wars begin...).
While I enjoyed his research, I found him conflicting himself in some areas. For example, he details how the entitlement systems of developed nations are so out of hand that they will eventually crush the productivity and wealth potential of smaller working populations and die unfunded. Yet later in the book, he suggests that countries adopt Scandinavian-like policies of guaranteeing mothers even more ample benefits for child rearing, to include financial incentives and time off. Never mind that the Scandinavian countries already can't afford to continue to finance existing programs with their incredibly high tax rates, they are under increasing pressure from freebie-seeking third world immigrants desiring to take full, life time advantage of something never really intended to be a come one, come all give-away.
Should the US and other countries already add to their unfunded liabilities even more, it is not clear how this will improve overall economic picture, notwithstanding debates over what's fair or what ought to be. Dent does not consider the possibility that some mothers in Scandinavia would rather not have to work at all during child rearing years yet there and elsewhere many are forced to because of the onerous economic and tax situation created when governments start guaranteeing something for "free" to the population at large. Exploring this angle would drift the scope of the narrative too close to a debate on feminism and broader social policy, so Dent assiduously avoids it, leaving the contradiction in his points for the reader to resolve.
But surely, if you have gone so far as to read a review on this book, you are among those well aware of the demographic cliff in real time, and maybe you've got your own way to prepare for its imminent arrival. So why pay attention to any of this? Dent claims that with this warning and the right information, you can make a fortune. I haven't back-tested any of his prior claims, but the minute someone starts offering me predictions, I usually reach for my wallet to make sure I'm not being had. That said, I am always open for new ideas on planning for the future, even if I don't expect to be burying gold bars in my back yard.
132 of 149 people found the following review helpful
on February 16, 2014
I bought this book after reading about in John Mauldin's newsletter. The demographic spending wave was a surprisingly simple yet lucid concept that intrigued me. It has been all downhill since then, including my subscription to Mr. Dent's newsletter. Buyers of this book and/or his "Boom & Bust" newslettter should ask themselves one question - if Mr. Dent is so good at predicting cliffs, why is he not filthy rich? If he is so good at seeing the impending doom, why has he not not made $20B a la John Paulson in each of the crises and booms he claims to have foreseen? Why is he living off his financial advice business. Google "Harry Dent net worth" and see what you come up with - nothing. Yep, it is not high enough to be worthy of discussion. But enough tough questions, on to lighter fare - the book itself. Because it is indeed light... on content. The same concept is repeated over and over again to "explain" all sorts of bubbles, with the caveat that for each bubble the model is adjusted with a number of ad-hoc factors. Mathematically inclined readers should remember what a true genius, John von Neumann, said a long time ago - give me four parameters and I will fit an elephant. Give me five, and I will make him wiggle his tail. I was going to write all this off as a few tens of $ spent on a poorly written book and a not particularly useful financial service, but a recent email from Mr. Dent's subscription service made me stand up and take notice. It was about sunspots. Yes ladies gentlemen, Dent Research has a new "wave". The returns of the stock market are correlated to the sunspot cycle?!?!? Until that email I thought that Mr. Dent is merely one of many financial advisers who oversell their ability to make money for you, but are a net good to a mostly financially illiterate populace. Now I am starting to think otherwise. Bottom line - spend your money elsewhere.
26 of 26 people found the following review helpful
on February 15, 2014
I finally found someone who wrote a book on the economic topic that I think is largely ignored: the coming retirement of millions of baby-boomers and how that is going to effect the economic landscape for the next 30 years. Harry Dent is spot on in recognizing how this shift is likely to cause extremely large changes in spending habits for millions of individuals, and, more importantly, what that means to folks like me that are much younger (37).
Mr. Dent does a marvelous job developing his thesis with various graphs supporting the notion that as people age their spending habits change. But that's about as far as he goes. As others have noted, he quickly loses focus (and credibility in my opinion) when he jumps into all sorts of other "wave" theories. This starts in chapter 2 and continues for the rest of the book. I was totally captured by the first chapter (thesis) and by chapter 2 or 3 I just started skimming as he runs terribly off topic. Mr. Dent is rather like a conspiracy theorist: if you believe in one conspiracy you believe in them all. Dent believes in one wave (the demographic wave) but then goes on in nausiating fashion to show a bunch of other waves, which in my opinion are used by fanatics who are trying to sell a product rather than real science.
Dent's got an excellent theory and the data to support what will happen to spending levels in different areas over the next 30 years: why the heck is he talking about solar activity? He could have written a detailed book, almost an industry-by-chapter- about exactly what his data shows.
But he got lazy. And moreover, he loses credibility because every few pages he says something akin to: "if you go to my website I'll send you a newsletter and you can follow along as we go." Guess what? To get Mr. Dent's data in any useful form, you'll have to pay for a subscription.
Too bad: Dent could have been a really great author. He could have developed this topic and gone into a mainstream career as the go-to authority on the demographic shift that's about to occur. But in the end you end up feeling like he's more a snake-oil salesman than a true professional.
What could have been isn't!
48 of 57 people found the following review helpful
on January 12, 2014
I am a huge fan of Harry's books. I have bought the last 5 books. I wish he would summarize each chapter with bullets and clearly outline his recommendations at an individual investor level. The key word is clearly. He does provide recommendations it is just mixed in with a bunch of detail that most non-economists don't need. To state it simply: If I believe that demographics point to major social, political and economic rough times ahead, what do I do. Spend 90% of the book providing strategies and 10% of the book documenting your hypothesis.
41 of 51 people found the following review helpful
on January 7, 2014
I Bought the Kindle Version and it works great. This book has given me numerous strategies from protecting my investments and how to take advantage for coming trends based on the Baby Boomer spending decline. It showed me what industries will grow based on the demographic trends and where to invest. It unlocks the Real Estate puzzle, the Gold puzzle, and how to maximize your investment dollars by investing where the largest demographic will be spending. I also found it valuable to understand which countries will prosper and which one won't in the coming years. If you really want to understand current economic trends , where they are headed, and how to leverage the coming crisis, then I recommend this book. Thanks to Harry S Dent's warning in 2006 about the pending housing crisis, many sold their properties and made a mint. Now is the time for us to make a mint again. I really appreciate Harry Dent because his theories are based on data and facts and he is best on CNBC when he stands up for his predictions and does not let the talking heads bother him. Go Harry, go .... and thanks for your advice in the last 20 years, it has made me a lot of money.
6 of 6 people found the following review helpful
on April 26, 2014
Harry Dent makes persuasive use of demographics and it should be a part of every speculator's knowledge base, be they "speculators" in stocks, their career, real estate, business ventures, education investments. Harry Dent is a good place to start going up this learning curve, I'd like to cross reference his assertions and be able to duplicate them.
- It's unfortunate he chose to narrate this book himself. Every bloody sentence sounds so stupidly over-emphasized that you begin to think he thinks you're an idiot and he's talking to a bunch of idiots.
- I'm sure a book like this has a lot of charts and graphs to make arguments using data, but you can't see those in the audio edition, so a "companion" printout of the data charts would be helpful for the audio version.
- His reference to Sun Spots in chapter 7 is plain stupid and causes an unfortunate loss of credibility. There is no cause/effect relationship between sun spots and economic cycles, nor does Harry attempt to establish any. He merely points to a correlation and claims causality. For work that is otherwise highly cause/effect convincing -- i.e. his demographic arguments -- inclusion of sun spots detracts from his credibility and will hurt the use of his demographic work which we need for mature discussions of economic traps we've made for ourselves.
- His endorsement of money-printing (inflation) is worse than his endorsement of sun spots. He does not understand the many-level evils, atrocities, and criminality of inflation, but the Austrian economic and ethical literature is well established on this point so I refer there reader to the sources of material on Austrian Economics (e.g. The Ludwig Von Mises institute at Mises.org).
9 of 10 people found the following review helpful
on May 20, 2014
I have a PhD in physics and have been doing analytical work all my professional life. I took Dent's birth rate profile and spending vs age profile plus life-expectancy statistics and inflation history to calculate overall constant-dollar spending year by year. The result differed markedly from his "spending wave". He noticed a shape similarity in birth rates and the constant-dollar stock-market DJI some 46 years later and built a whole falacious theory on that. Also his references areoften too non-specific to identify his exact data source. I gave 2 stars because some of the information and concepts were interesting; however, I dont trust his future projections.
17 of 21 people found the following review helpful
on February 23, 2014
Starts off pretty good with his demographic cycles, then begins to get blurry as he mentions, but does not deal with, several cycles such as political, sun spots, commodities, etc . He does not pull all these cycles into a believable forecast to support his contention of the worst ever depression in 2014 to 2017 or so.
Even if you believe in his projection of depression in 2014, he does not really give any advice for an individual investor/retiree as to what to do about it. Do we leave the stock market and go into what? He hates gold, real estate, commodities, and just about everything else. Are we to really believe he can time the market? Sell out in March 2014 and reinvest late that year to make billions?? I doubt that!
He keeps repeating himself, going over his demographic theories again and again and again. We get the point! He ends up spouting off about all his political beliefs, and they are not supported by any of his work. He just believes them, so we should too.
I had high hopes for the book, but these began to fade about 30 to 40% through the book. He should be ashamed to charge money for this diatribe!
5 of 5 people found the following review helpful
on August 6, 2014
This book argues that a lot of the economics problems we are having (in America and elsewhere) are the natural consequence of our being at a certain stage in a demographic cycle. To put it simply, people tend to spend the most in their late forties, we have a huge generation of people now leaving their late forties beginning around 2008, and so the economy is bound to go down as such a huge segment of the population spends less and less, comparatively speaking. The younger generation is much smaller and cannot boost consumer spending enough to compensate, especially since they are stuck paying for the entitlements given to the older generation. Dent spends a lot of time going over the numbers and polishing up the material in graphs.
Chapter 1, "The Demographic Cliff Around the World," explains how people spend pretty predictably according to their ages and just how many developed countries have a large older generation (we call it the "Baby Boom generation" in the U.S.) that is aging past the speak spending point. I didn't know so many countries were having this trend. Some, like Japan and the U.K., were pretty predictable, and France and Italy are often in the news for having low birth rates, but many other countries are set to go off the demographic cliff in the near future (Germany, South Korea, China, Spain, etc.).
Chapter 2 explains how Japan's government policy of quantitative easing has not saved their economy; it just keeps them in a constant (although increasingly expensive) state of comatose economy. They can't recover, and they can't let the systems and businesses that need to die or restructure do so.
Chapter 3, "Why Real Estate Will Never Be the Same," was quite refreshing. Everyone I know insists that buying a house is a good investment because housing prices are bound to go way up someday. Not so! Dent argues very clearly why you should not expect house prices to rise the way they did in the past. Buy a house because you want to live in it or earn rental income, not for appreciation. With fewer and fewer buyers and more and more houses going on the market as Baby Boomers die, go into nursing homes, or move in with family, house prices will not pay off more than basic inflation and replacement costs.
Chapter 4 goes over what kinds of debt various countries have--government debt, private debt, financial debt, and corporate debt. Dent never clearly explained what "financial debt" was and why it didn't count as corporate debt. I can't think of any financial debt that exists that is not held by a government, a corporation, or an individual.
Chapter 5 was "A Brief History of Financial Bubbles." This did not add greatly to the value of the book in my opinion. It was a nice bit of history but not terribly illuminating.
Chapter 6 was about commodity prices and how they will affect emerging countries. This provided a helpful piece of Dent's argument, since a lot of people would argue emerging nations will save the world economy. Dent claims a 30-year commodity cycle forbids this. However, he didn't discuss agricultural commodities much, which I would think are pretty important in a book about demographics! Surely grain prices are bound to go up in a world with 7.1 billion people and counting.
Chapter 7 discusses how individuals should respond, given Dent's theory. I had hoped for a lot of actionable advice here, but maybe Dent intends to give the practical how-to only to his email subscribers or something. Sorry, the average American is not going to be able to take the stock advice he gives or invest in a vacation home at a particular time. Is there some action more practical for the everyday American?
Chapter 8 was, surprisingly, one of the best parts of the book. It was on business strategies for the economic downturn ahead. I don't run a business, but I found the descriptions of "network-style" businesses (those that focus on customers and give the employees who work directly with customers lots of power to solve their problems directly) fascinating. Dent did a really good job explaining how businesses can avoid cumbersome hierarchies without crashing.
Chapter 9 discussed strategies the government should employ to handle the coming downturn.
PROS: The book makes the overall argument that using government stimulus packages over and over is destructive quite clearly. It also argues for the demographic cliff itself and why we should care about it quite clearly and effectively. The book enlightened me about some aspects of world events (e.g. Did you know the U.S. isn't the only developed nation with a housing bubble? The cause wasn't just subprime lending--many other nations that didn't do subprime lending still had a housing bubble.).
CONS: There were a lot of graphs, which is fine, but often the graphs didn't make Dent's points effectively. Often I would read the text about Dent's ideas, look at the graph that was supposed to illustrate them, and go, "But the graph doesn't really look like there's a correlation there...." Why argue for a correlation and then use a graph that seems to disprove your point? There were also more typos and errors than I would expect in a mainstream publication. Lastly, the graphs are often cited, but the material in the text seldom was. I particularly wanted to know where Dent got his information that immigration from Mexico is currently a net zero, but there were no footnotes, endnotes, or bibliography.
Overall, a worthwhile read.