Harry Dent – Dow Downside Target 6,000
Yet again, Harry Dent warned CNBC viewers the U. S. stock market is in a bubble, but there will be strength before a crash ensues dropping the Dow to 6,000 by 2016. The Dow Jones industrial average will likely hit the 17,000 level within the next few weeks before it plummets, the economist and author argued before Michelle Caruso-Cabrera and Ron Insana.
“I think we see another correction, crash, that is larger than the last one,” said Dent, author of “The Demographic Cliff,” during the interview on “Closing Bell.” “I think this will be the most dangerous period in people’s lives in investing.”
The fundamental problem plaguing global economies is a shift in demographics, Dent said. An aging work force will soon retire, outnumbering younger workers, thereby draining government entitlements, he added. Despite government stimulus, younger workers tend to spend less, too, Dent continued.
“Generations spend and then they don’t,” Dent said. “Governments are fighting that with massive stimulus, and it shows why the economy is so weak with so much stimulus. Demographics is the only way you can explain that,” Dent explained.
Dent said the negative demographic phenomenon was even more pronounced in Germany and other southern European countries than it is in the U. S.
Insana poo-pooed Dent’s concerns regarding a crash citing relative U. S. economic fundamentals, along with the manufacturing renaissance and technological revolution underpinning U. S. stocks.
Back in January 2013, in a heated debate, Dent predicted stocks would crash in the 3rd quarter of that year following a few months of strength [link].