Jason Hartman brings on returning guest and economist Harry Dent to discuss his latest book, Zero Hero. Dent gives us insight into current demographic trends and their impact on fiscal and monetary policy. He goes into technology and how long it takes to go mainstream and impact society. Dent ends with predictions on the economy and a potential revolution if current policies don’t change.
Welcome to the creating wealth show with Jason Hartman. You’re about to learn a new slant on investing some exciting techniques and fresh new approaches to the world’s most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine self made multi millionaire who’s actually been there and done it. He’s a successful investor, lender, developer and entrepreneur who’s owned properties in 11 states had hundreds of tenants and been involved in thousands of real estate transactions. This program will help you follow in Jason’s footsteps on the road to your financial independence day. You really can do it. And now here’s your host, Jason Hartman with the complete solution for real estate investors.
Jason Hartman 0:52
Welcome to Episode 986 986. This is Jason Hartman, thank you so much for joining me today. Greetings from Lakeland, Florida. Yes, I landed in coming back from Sweden from our incredible Ice Hotel trip with venture Alliance mastermind group. I landed in Fort Lauderdale last night. And I am driving over to Tampa today for a meeting with about 30 or 40 real estate investors and real estate people, not just investors, but people in the trade, if you will, most of you listening probably aren’t in the trade. slight difference there meaning that, you know, these some of these people do real estate, just investing as most of you listening to, but some people are actively in the business of either flipping properties or wholesaling or info marketing and things like that. So I’ve got a two day mastermind meeting with this group. And then I’m on to Puerto Rico. Yes, I’m going to Puerto Rico again. I’ve been to you know many of these places before times I’ve been to Sweden a few times. I’ve been to Puerto Rico several times. Of course, I’ve been to Florida a zillion times. But going again, one more time just to check out Puerto Rico the amazing tax deal. Another couple I know moved there just recently, and I’m going to stay with him and kind of check it all out one more time, just to, I think, really eliminate the idea of potentially moving there, but let me tell you how incredible the tax deal is. And I did a couple of episodes on my jetsetter show about the amazing Puerto Rico tax incentive. And listen, I’m I’m no big fan of Puerto Rico. I’ve been there several times as I mentioned, but I am a fan of reducing my overall total tax burden in terms of income tax to you ready? About four to 8%. That’s it. That’s all Yes, that’s all and many, many of my Well, I don’t say many, but several of my friends have done that. I just got to go, hey, look, I got a free place to stay gonna hang out with some friends. look at a few properties. I’ll let you know how it all goes. I’ve done this before I’ve done this trip the same trip before I just wasn’t into it. Maybe something will change this time, you know, you always got to remember, when we hear something, see something learned something the first time, you know, we get one impression and maybe the second time or the third time or the fourth time we get another impression. The only problem with the luxury of these multiple impressions, if you will, is that it takes time to expose ourselves to multiple impressions, whether it be listening to Jason Hartman’s fantastic podcast over and over again. And thank you for all of those of you who do that. I have heard from many of you that say, you’ve listened to every episode I have three or four times. Wow, I’m impressed. I love you people. Thank you for doing that. I’m surprised you can tolerate that much of me but I Appreciate it nonetheless. So yeah, and then I’m on my way home next week back to home. And it’s been quite an amazing trip. But today, today’s episode, what do we have? We have Harry dent. He is back on the show today, I believe for the possibly the seventh time I want to say, I don’t know, I’ve lost count. He’s been on so many times. And of course, Harry dent, you know, some of his predictions are right on, some are way off. But nonetheless, the prediction business is very hazardous. So, give him a little bit of slack for that. And he’s out with some new predictions today. I think you’re gonna be interested in actually not today. This was recorded. You know, when his last book came out, maybe I want to say a couple months ago. I just noticed in the dropbox that we had not broadcast this episode. My producer Adam says to me, Jason, are you gonna do this Harry dent episode, you know, it’s been sitting here for a little while and I thought we got to do it. We got to do It which is even better in a way because even though it’s only been a couple of months, not that much time really and, you know, overall economics time not not that much has changed since then. But, you know, it’s interesting to look back at these prognosticators and their predictions of course, that’s why we have flashback Friday you gotta listen to flashback Friday, including yours truly, by the way, you know, I’ve been so right about so many predictions pat on the back pat on the back. But I’ve been famously wrong about more than one I was thinking of another I was wrong about today. But one I’ve been famously terribly tragically wrong on his interest rates. I’ve I’ve admitted that many times. My interest rate predictions have been awful. Don’t listen to Hartman when it talks about interest rates because he sucks. He’s terrible, terrible on the interest rate predictions, but you’re always thinking of another one of my very wrong predictions today. But I may actually be right on it. And it wasn’t a real estate or a general economic prediction. It was my prediction about Snapchat or snap Inc. When Google offered to buy them years ago, I told you all on the show that I thought they were completely nuts for not selling. And then their value went way up above. But now they’re falling on hard times again. So hey, a broken clock is right twice a day, right? Maybe I will ultimately be right about that one. And we’ll see, you know, maybe I’ll be right about Tesla to Tesla, I say is the most highly overrated company in the universe. I’ve owned two other cars. And you know, one was alright, I like the first one. The second one was a total lemon. You’ve heard my story about that. So we’ll see if Tesla makes it through their hard times because they’re definitely going through some challenges. Another interesting thing before we get to Harry dent, and we talked about the economy today and the real estate market, I thought I’d let you know, since I just finished yesterday, a 10 hour flight from Stockholm to Fort Lauderdale. I thought I’d let you know. I saw an interesting article in USA Today today about Airbus, the airline manufacturer, the French company, obviously, they are working on a plan that by 2020 I thought this was pretty interesting. They hope to offer an option of sleeping berths where you can actually go down and sleep in the cargo hold. And I thought what that’s really, I don’t know about that. That’s pretty tacky sounding. But then I looked at the picture, the I guess, the rendering the artist’s conception of what this would look like. And I thought, you know, that looks pretty swanky. I’d want to go down and sleep in the cargo hold and, and I guess the way the transportation works on the airlines, you know, for safety reasons and such, everybody needs to be in their regular seat for takeoff and landing. But, you know, what do you do you probably go down and rent space in the cargo hold or maybe only It comes with business class. First class ticket. I do not know. But I thought that was a pretty interesting idea and shows a possibly a pretty big shift in the industry. So we’ll see if that happens. You know, this show is not all about real estate folks, not all about real estate. We talk about all the broader issues, with our main focus being real estate investing personal finance, and the broader economy as well. But hey, speaking of which, let’s get to our guest today. Before we do I want to remind you, our two events in the northeast are creating wealth Philadelphia event at a very swanky Philadelphia hotel, which does not have a larger ballroom for us. So this one is limited in size. I am almost positive this event will sell out and it will sell out soon. And no, that is not a bunch of hype. Not all of our events sell out. We’ve had many events that haven’t sold out, but this one I think is different. Yes, this time, it’s still Famous Last Words of any investor, right? Well, in this case a educational promoter really get your tickets. Prices of tickets have gone up as ticket sales have been very brisk selling like hotcakes. So get your tickets go to Jason Hartman calm or Jason Hartman creating wealth.com either one and get your tickets for the event on May 19. Saturday, creating wealth, it’s the only one we plan to do this year. So if you want to see creating wealth live, our oldest and longest running educational event. I remember I did the first one of these back in 2004. That’s how long ago it was. That was 14 years ago that I did that event folks in February so it was actually a little more than 14 years ago. Join us for that this is an amazing event talks about the broad macro economic issues affecting you in the economy, real estate investing etc, etc. Jason hartman.com Tickets for that. Click on the event section, of course. And then the following weekend. I am staying in the northeast. Because the following weekend we’re having our venture lions mastermind. For the first time. This is a retreat a weekend event in New York City on Memorial Day weekend. What a great time to come to New York City. And by the way, for both of these events, we secured phenomenally good hotel room rates our room blocked by the way our roadblock is going to sell out quickly for Philadelphia. Of course for venture Alliance, the following we can you can come as a guest if you’re not a member, and let me tell you, you gotta get in the venture Alliance you need to join if you want to be around. I mean, spending five days in Sweden with these people was so amazingly well. First of all, it was fun. It was a once in a lifetime bucket list trip to the Ice Hotel and our Stockholm trip we took a helicopter ride over Stockholm at sunset. At the Ice Hotel, we did dog sledding, we did snowmobiling. This is the way millionaires and billionaires travel folks. And if you want to up your mindset, your perception of your own life, if you want to make this a subconscious expectation that your future will be dramatically better than your past, you need to get in a mastermind group like the venture Alliance mastermind. And so come and audition at for one weekend in New York City. on Memorial Day weekend, go to venture Alliance mastermind comm check out pictures from some of our events they’re in such an information venture lions mastermind calm and join us in New York City. We got great room block rates it very nice elegant hotels for both of these events. To just finish my final point on Sweden, the stimulating stimulating conversations that we had and all I had All the other members had there amongst themselves. Pretty much everybody told me that was the best trip of their life. really an amazing, amazing event. So don’t miss out on this stuff. Treat yourself. Make this your vacation budget every year in the venture Alliance, you will not regret it. And hey, if you don’t like it, just quit. You know, there’s no risk, pay to play. It’s not not any big commitment, you know. So come as a guest to the New York City event and check it out. We’d love to have you as a guest. And I guess that’s it. Let’s get to Harry dent. And let’s hear what he has to say about zero hour in his new book and his new predictions. Here we go. It’s my pleasure to welcome a longtime returning guests back to the show. This is maybe the sixth or seventh time he’s been on the show and that is Mr. Harry dent. He’s founder of dent research. He’s editor of the free newsletter economy and markets and the author of the new book Zero Hour turn the greatest political and financial upheaval in modern history to your advantage. And of course, Harry’s the author of many books. I’ve been following his work since maybe 1996. I want to say, Harry, welcome back. How are you?
Harry Dent 13:16
Oh, nice to be back. Jason.
Jason Hartman 13:17
It’s good to have you. You are in Puerto Rico and you went through quite a quite an ordeal last year. I know. You moved to New York for a couple of months. So glad you’re okay. And we’re happy to have you back. And while everybody is freezing in the northeast, you’re nice and warm.
Harry Dent 13:32
We’re finally looking good. After all of this, I had to hold my windows and doors from from blowing out that’s how bad it was. Out. freezing. We would never know what happened here.
Jason Hartman 13:43
Yeah, exactly. Exactly. Well, Harry, I know you track and this is a little you know, we’ll get into the economy, real estate market, GOP tax reform. We got a bunch of stuff to talk about your new book. But I know you interestingly, you track some kind of to some academics and economists you track A couple of sort of, I don’t know if it’s fair to say, but kind of off the wall or non non mainstream things, and one of them is sunspots. You know, there’s all this talk about global warming, of course, it’s freezing because it’s warming. So the kind of logic here it’s weird, but what’s the whole thing with sunspots? Tell us about that.
Harry Dent 14:16
Okay, first of all, people think this is weird stuff. The Farmers Almanac lives by this stuff. And they predicted a cold winter this year just on this. We’re at the low end of a sunspot cycle these things, the sun gets warmer about every four or five years and then colder every five to six years to follow a 10 to 11 year cycle on average. And it’s just you know, sunspots and the theory is that the pool of bigger planets like Jupiter or Saturn cause this to happen. Nobody knows exactly how, but it does affect solar radiation. I mean, the sunshine and the energy we get from the sun can be 20% higher or lower. It’s a top or bottom of the cycle. rainfall is also higher when there’s higher sun because there’s more evaporation and then therefore more rainfall. This is a big deal and it but it also affects human beings. If you just think about people living in a cloudy, foggy place like Seattle, well, they have high suicide rates, because without sun, oh, you’ll feel good. Yeah, without energy. You don’t feel good. And so it also affects investor psychology and business and everything. And so this is a cycle that that I’ve documented back. Hundred and 70 years. I think the recessions happen 88% of the time in the downside of this sunspot cycle, and worst financial crises in history 11 out of 11 back to the early 1800s have hundred percent happen in the downside of the sunspot cycle. And we’re in the downside of a sunspot cycle since 2014 and it will bottom around 2020 Give or take. And again, these things this is not as clock like as some cycles. But scientists can track and predict this and they’re saying, they’re saying this thing would peaked by late 2013. They were only a few months off, and they’re saying it should bottom by the early to mid part of 2020. So this is saying number one this winter, being so cold is not unexpected. At the bottom of the sunspot cycle, things are going to be colder than warmer. But for the economy, most the worst recessions come into the downside of this cycle. And guess what the last downside of this cycle was 2008 2009
Jason Hartman 16:39
pretty interesting stuff the Great Recession
Harry Dent 16:41
so so this is serious stuff. I get so much flak. Yeah, I’ve had people who read my books and subscribers my newsletters say, Harry, you you can’t talk about this stuff. I mean, I’m saying what do you mean this isn’t astrology or something? This is really clear scientific stuff and it works and it works all Throughout history,
Jason Hartman 17:01
your friend Bob Proctor who’s been on the show before, he’s a really interesting guy, Elliot wave theory stuff. And he talks about how people in the economy, you know, they share their emotions with each other. And certainly that has an effect on things. I mean, listen, if it’s gloomy all the time, you’re not going to be as optimistic. Arguably, that’s why, you know, sort of the old, I don’t want to say the current version, but the old version of my home state, socialist, Republican, California, sort of have this, you know, like this optimistic type of mindset.
Harry Dent 17:31
It’s funny state. Washington is not, hey, depressed people don’t buy stocks, you know, and don’t invest in the future and stuff. So it’s not the only factor in the economy, but out of four cycles. I’ve identified over 30 years of research and I’ve had to find one after the next when something I can’t explain is coming up. I’m like, Oh my gosh, I’m missing another important cycle. And that’s how I found sunspot cycles, the top mutual funds Manage your back then at PIMCO, was the guy who said, Hey, sunspot cycles was the way I averted the 2000 2002 tech crash, he saw no grows. I forget the guys name. But he was the Bill Gross was the top bond fund manager. This guy was the top mutual fund manager. And he said, I got out the sunspot cycle peak in March of 2000. And then went down. And that’s what allowed this guy to get out of the market. He said he saw this coming and nobody would have ever seen that coming. So it’s such a powerful cycle, but it affects a lot of things and stuff and it’s affecting the weather. Right now we’re towards the bottom end of a sunspot cycle. That’s been declining since 2014. But more importantly, the sunspot cycles have been lower at their peaks since the 1960s. And then that would go against climate change on the warming side. There is warming from co2, but there is cooling from the sunspot cycles. So you have to understand both to get the full picture. And when it’s too hot people say, Oh, see global warming, and then when we hit go cold. Yeah, right. Yeah. Like, there’s no global warming. Oh, no, both camps are wrong. Both are happening.
Jason Hartman 19:20
But it’s cool. But if you want to be right all the time, you just call it climate change.
Harry Dent 19:26
That’s why they switched it from global warming or climate change, climate changes. And there are natural cycles that are massive, long term and short term. I understand all these cycles because I study cycles. I understand billion year climate cycles. I mean, there was a time when the earth froze over totally. And there was a time and an age the dinosaurs when there was no ice anywhere. That’s how extreme natural cycles get. But there’s intermediate, you know, and there’s shorter term and right now, the biggest thing people should understand is probably Gonna get a little cold in the next few years? Yeah. Okay. For living in Puerto Rico.
Jason Hartman 20:04
Hey, that federal tax break you have is pretty great to hear we got the new Zero Hour book out. Now, obviously that was written before GOP tax reform. Which one do you want to talk about first zero hour or tax reform or blend them together? I’ll let you take it.
Harry Dent 20:19
I’ll start with tax reform because I’ve been saying this for over a year in my newsletter. Look, there’s a time to cut taxes and stimulate business and there’s a time not to. This is not the time, businesses have had free money from the Fed. And they’ve used this to buy back their own stocks and pay higher dividends and do mergers and acquisitions without really investing in expanded capacity in new jobs. all we’ve done is hire back the people we laid off in the Great Recession, and now we’re back at full employment 4% give or take, and guess what workforce growth and I’m the demographics guy under Stand is better than a buddy workforce growth, which is just a combination of young people entering and older people retiring is very predictable. And it’s going to be flat to near down for decades, how are we going to grow with no growing workforce growth and on top of that productivity, so so if you take growth from workforce and productivity, well, productivity has declined from two to 3% in the past down to half a percent now on average, and it’s going to go to zero or lower, because older people in an aging society are less productive period. So this is also something document so we don’t have the growth trends we had when when somebody like Trump says, oh, if we just lowered taxes, or we just stimulate more and more quantitative easing, we’re going to grow at 4%. Again, we’re never going to grow at 4% again in this country, until we start to double our lifespans or something and that is possible. In the next several decades, but until then it’s not going to happen. So this is a big fake news I would call it Oh, the republicans say, Oh, we lowered taxes. Now businesses are going to invest in build more factories and hire more people. No, they’re not.
Jason Hartman 22:15
Okay, so my question about that is okay, we hired you know, because of the essentially free money that’s been flowing into the economy thanks to you know, QE and other soft money policies, companies and individuals especially the rich have been able to take advantage of you know, free borrowed money you could even argue negative interest rates, I guess. Yeah. And that has been a huge stimulus
Harry Dent 22:40
stimulus for wealth not a stimulus for the average worker whose wages have been going sideways the downs yeah thousand to help them because they don’t have the money to invest and take advantage. Oh, no, I agree.
Jason Hartman 22:52
It always helps the rich I mean, no question. Yeah, absolutely, absolutely agree with you.
Harry Dent 22:57
But if the rich invest in new plants, and Jobs then it does trickle down to Homer Simpson, this is not happening because they’re not investing. We’re at 75% capacity for businesses. 85% is normal 90% is optimal. We don’t need more capacity because we already over invested in the great boom. And now all this free money goes back to stock buybacks. I’ve got a chart that shows that the net money coming in the stock market between institutional investors, businesses and consumers, consumer investors, all has come from businesses, businesses, buying back their own stocks is great as bs recovery in history.
Jason Hartman 23:41
Yeah. So I definitely know about the stock buybacks and I’ve talked about that a bit on the show. But you know, I’m curious, what is the real effect of a stock buyback? So this money flows in and you know, many are saying now with tax reform, more money’s gonna flow in from those offshore accounts. And there’s gonna be a little little less incentive to do the double Iris twist and all these complicated schemes these big, you know, companies and the ultra rich are doing, and it’s gonna flow back on shore. And, you know, the critics would say, well, it’s just gonna be used for stock buybacks, right. But you know what, let’s examine the stock buyback concept for a second. Is there any stimulative effect from that? I mean, the buyback certainly makes the price of the stock go up, but who
Harry Dent 24:25
benefits what else happened? Homer Simpson or the top point one to 1%?
Jason Hartman 24:30
Not a homer simpson directly but you
Harry Dent 24:32
know, percentage of people in this country own almost all the wealth, especially the financial assets, so it benefits them and they’re already so rich. They don’t know how many jets to buy, or which yacht to buy, or which house and vacation house to buy. This does not help Homer Simpson and you cannot have an economy where the generals advance without the troops for so long. That’s what happened in 1929. The rich got richer and richer and richer. Have speculative profits off of stocks and real estate and stuff until the economy imploded. And that’s going to happen again, because it always happened. Everybody’s got to move together. And that’s what’s not happening here. And hey, I’m in the top point one to 1%. I’m, you know, I shouldn’t be complaining about this. I know I am too, and I’m complaining. dangerous. Yeah,
Jason Hartman 25:22
I agree. I definitely do not want to live in a banana republic, even if I’m in the elite class, because it’s no fun. It’s too unstable. There’s too much crime. It’s just not good for humanity or in innovation. It’s not good for anything. We could all move even if we’re not, you know, really rich in the top 1% we could all move to some third world country and live like kings right in Queens. Yeah. But you know, nobody’s really doing that in any real significant way. Obviously,
Harry Dent 25:49
I would consider Thailand and Bali because I’ve been in both those places recently and man is a high quality of living. If you have money and my gosh, your money goes Five times as far right,
Jason Hartman 26:01
right, right, right, right. Well, you know, there’s there’s a few but it’s on it’s on the quiz. Yeah.
Harry Dent 26:05
You know, Uruguay Probably not.
Jason Hartman 26:08
How about Venezuela? Here? They’re doing what the hell say, isn’t that sad? socialism was a disaster. But here, you know, I mean, when you said, you know, the rich are buying the yachts and the jets and stuff like that. But I mean, somebody’s building those yachts and jets, there’s a bazillion parts suppliers, you know, there’s people that maintain them. I mean, I don’t know, you know, this is that old argument of that we live in a consumption based world. It’s like, if you don’t have growth, the whole thing falls apart. You got to have growth. And you can argue about externalities and how it’s bad for the environment, so forth, for sure. No question, but it does trickle.
Harry Dent 26:42
Right. But it trickles less when the growth is all going to the top 1%. And I tell you, Jason, it’s really the top point one Oh, yeah, yeah, no, that’s where it’s really at the one out of 1000 households that control 25% of the total wealth in the country versus Is the top 1% that control 50% that one 10th of that 1% controls as much wealth as all the other point 9%. So that that’s where it’s at. And that does not trickle down as much because those people save and invest more. And they buy certain things. And yes, they feel certain industries like yachts or whatever or high end housing, but they don’t feel the everyday economy. You cannot have an economy where the rich keep getting richer and the everyday person falls behind that ends in revolution. And that’s what my book is about. Yes, sir. Our it’s about luck. We’ve come to the point like in the 1700s, where we had the American Revolution and the French Revolution and stuff where, where trends got so extreme that the everyday people started revolting against the rich and the people in power the Americans versus the British and the peasants versus the Lords and France and stuff and this happens Man, because free market capitalism does reward the people who contribute the most. And that’s a damn good thing from my point of view, but every trend can go to extremes. And you know, democracy includes everybody and democracy can go to extremes where everybody’s got such a free lunch that nobody’s working. Oh, yeah, you get the tyranny of this guy. We’re having all of this. We’ve got an entitlement situation and countries which is not even remotely sustainable with a smaller millennial generation, that peak levels coming in the coming decades to support a dying and retiring baby boom generation that’s been promised everything and, you know, policeman to get 100,000 a year for life and stuff. This is just not possible. I mean, any moron with a calculator could tell you that there’s no way these things can be paid. But economists say oh yeah, but if If we grow at 4%, and if inflation is 1%, and if blah, blah, blah, all these things, it can work out. None of these projections have any merit whatsoever. I look at reality, I look at demographics, I look at economic cycles, and we don’t always grow at 4%. We grow at three to 4% and booms and then we declined zero to one to 2%. In downturns, nobody takes into account the downturns like 1929 to 1942 or 1973 to 1982. Nobody takes into account those things we do. These entitlements we have are totally unsustainable. And there’s only one simple answer to it among many. We have to retire later because we’re living much longer and never adjust our entitlement. I know I said
Jason Hartman 29:50
it’s been 60 it’s been 65 since people lived an average of like four years after they turn 65 and now
Harry Dent 29:57
they’re living 30 years. Yeah. A few years
Harry Dent 30:02
at it’s ridiculous 65 totally, totally.
Jason Hartman 30:06
And they’re and they’re pretty vital. You know, the health span has gotten much better. It’s not just the lifespan. It’s the health span. A lot of older people are much more engaged and living much more productive, healthy. lies
Harry Dent 30:20
you no longer I’m 64 going on 65 Yeah, I’m supposed to retire next year. It’s crazy. Should I retire? Are you kidding nots? Yeah. doesn’t make any sense. And if I did, I’d be bored to death. Right?
Jason Hartman 30:33
Absolutely. Okay. So, Harry, let’s talk a little bit about some of the technologies and I believe you talked about this in your book. Why won’t some of these, you know, largely hyped technologies, and I don’t want to say hi, in that they’re not real because they are and I talk about them a lot. But you know, there’s a lot of talk about them self driving cars, 3d printing, Ai, artificial intelligence, virtual reality blockchain, you’re saying that these aren’t going to really start to pay off for quite a while, you know, like 13 years, right?
Harry Dent 31:03
Yeah, it’s like automobiles or electricity or anything like that they take decades to move into just the niche markets. And then when they really prove themselves and come down in cost when when Henry Ford’s all of a sudden producing Model T’s for a 10th of the cost and paying his workers, you know, $5 an hour instead of $1 an hour, that’s when things take off. And that’s when they make a difference. So there’s always innovation. So when I talk to people like George Gilder or technology experts, they’ll say, oh, Harry, there’s always innovation and innovation is exponential. I said, I know innovations exponential. I’ve studied history, but it’s when those exponential innovations come together and move on S curve, which is the most exponential end of the mainstream from 10% to 90% of the public in a matter of a few decades. That’s when the world changes. That’s when everybody uses automobiles and electricity and phones. To move to suburbs instead of living in crowded small new cities, and that’s when everything explodes. We’ve already seen that with the internet. We’ve already seen globalization hit its peak we’ve already seen, you can get on your your iPhone and contact anybody and talk about anything and buy anything that’s already peaked. Everybody’s got that in the developed world. So it’s gonna take a while for nanotechnologies and biotech, and things like that. And 3d printing. Those are longer term technologies, that could make a big difference, especially biotechnology, if we could live to 100 to 120, instead of 70 to 80. In the world, that would change the demographic decline, which I can project forever is bad. Well, that would change if we were in the workforce twice as long because we live much longer and that is going to happen by some longer term cycles. I study. They just a matter when and We have a 45 year innovation cycle says, look, the time for that to happen would be 2032 to 2055. That’s still a ways away. Right now, we’re gonna have to wait on that. And we’re going to have to deal with slowing demographics around the world, which will get better in a lot of ways, several years from now, but we’re gonna have to deal with flowing demographics and productivity until these technologies take us to the next level like the internet did and like automobiles did before that and railroads before that. And steam ships. I mean, steam ships change the world, railroads changed the world, and all commerce and how we worked and in the assembly line along with automobiles, that’s the type of stuff we’re seeing still a lot of innovations, but it’s not going to hit for another, I’d say another 10 years or so.
Jason Hartman 33:54
The excitement is premature. In other words on some of these technologies, as is your opinion,
Harry Dent 33:59
I mean, driverless cars is going to reduce as many jobs as it creates. We have Tran transportation is one of the
Harry Dent 34:08
better things, but these things are not going to expand our economy like the internet did or TVs and automobiles that they’re going to make it more efficient, which is also a good thing. I’d be an investor in all these technologies, I’d be an investor. In blockchain. blockchain is just going to make the internet more efficient and secure for financial transaction. That’s a big deal, but it’s not as big as the internet itself. Google and email tripled the productivity of my business at a minimum tripled. There’s no way that blockchain will triple the productivity of what I do and research.
Jason Hartman 34:46
Yeah, interesting stuff. Interesting stuff. You know, Harry, I first became attracted to your work in the mid to late 90s. Because it seemed like demographics are almost 100% reliable. You Know when people are gonna hit 46 years old when the bulk of that curve is going to hit 46 the peak spending time or whatever age is the peak income time, you know, those aren’t exactly equal, by the way, they’re a little bit off. But what’s what’s interesting is that, you know, like, for example, you were years ago, like the God of Wallstreet, every financial planner was quoting you, and they were saying, you know, be in the market. And then in 2010, we think the markets going to take a dump because the retiring baby boomers are going to pull money out of the stock market become more conservative. And then you also talked about how they’re gonna sell their mcmansions. And you know, that
Harry Dent 35:39
is fun, but the biggest thing is spending less spending drives economy. Yeah, yeah,
Jason Hartman 35:43
but, but the thing that’s interesting, I mean, argue with me if you want about this, feel free, but you know, a lot of us have didn’t really happen. And of course, the thing is, you can’t really predict it just with demographics because you don’t know what the feds going to be doing at that time. You don’t know what the monetary and fiscal policy You’ll be you don’t know what the technology will be. I mean, it’s just I
Harry Dent 36:04
know, the prediction business is tough. You know, you’re right, that the wild card is the government’s and the monetary and fiscal policies. We have never had a time in history. I mean, the economy did start to weaken in 2008, as to Japan in the 90s, as we predicted, because of demographics, but government stepped down, especially in early 2009, with quantitative easing, and just flooded the economy. Right. free money. Yeah. And that’s,
Jason Hartman 36:32
that’s a huge wildcard.
Harry Dent 36:35
Yeah, compared to a $75 trillion economy. That’s like a 20% dividend to everybody’s like sending everybody a $10,000 check in the mail over time. That really had never happened before. Governments saw that the economy can melt down like the 1930s with excess debt, and slowing demographics, everything we’ve explained our past both, but I didn’t ever think that central bank would just go crazy and just said, well, we’ll just replace every dollar with a new dollar. And you know, hey, that has worked longer and better than I would have ever thought right? Simple, but you can’t Jason live on something for nothing. Economics and you know what’s happening today, you know, the biggest reason the stock market’s going up one thing, companies are buying back their own damn stocks. That’s the greatest bs thing in history, they got so much free money, and now they’re gonna get lower taxes, free money from lower taxes, they’re just gonna keep buying back their stocks, so there’s less stocks, so even there if they’re not growing, the earnings per share is growing. This is only benefits the top point, one 1%, which is already off the charts rich compared to any time in history, even now more than 1929 and 1929 lead to the greatest depression history when you got those extreme. This is terrible economics and hang on, hang on. Hang on. Now I’m gonna be a limo driver in Australia and just say, I don’t know about anything
Jason Hartman 38:06
hairy, but hang on a second on that stock buyback thing? Well, there are many effects to that there are trickling issues and things like that. But one effect that’s obvious and immediate, is that all those execs who are buying back their stock and companies buying back treasury stock, it makes everybody in that company more committed to the company, because they have more at stake now.
Harry Dent 38:28
Well, no, no, no, the executives, the owners, but not the everyday person. I know
Jason Hartman 38:33
that I know that. But what I’m saying is look at the there are wide ranging effects that I think need to be considered. If they’re more committed to the company, then you know, they’re gonna work harder to innovate more to make things better, faster to
Harry Dent 38:46
buy back their own slow dividends to their stockholders. They’re not expanding their facilities companies are at 75% capacity today after this great boom and recovery. 85% of Normal 90% is optimal. They’re not expanding their capacity and they don’t need to, because the economy, our workforce is growing at zero. Yeah, productivity is growing at a half a percent,
Jason Hartman 39:13
we definitely, we definitely need to see real wage increases, which have not happened for decades in any substantial way.
Harry Dent 39:23
Why? Because all the profits are going to the owners, and the investors, not Homer Simpson, the worker. And if the workers can’t grow with the generals, and eventually they revolt and cut off the heads of the generals, and the economy dies, that’s why I’m saying we’re gonna have the biggest revolution in history, because the everyday people and you got to remember the tax reform just passed by the Republicans. You know, how what the polls showed the support of the public was 26%. That’s less than Trump’s 31% base. The troops are not behind the generals here,
Jason Hartman 39:57
here. Well, fair enough. I mean, who is the person in the leadership role, basically saying, you know, there’s no bread, let them eat cake. Is it Trump? You know, is it all these CEOs? I mean, is it the banking cartel? How serious and significant is that problem? You know,
Harry Dent 40:13
there is no leadership here. Now, I tell you though, movements major revolutions start with populist movements which start with people like Hitler, and I hate to say it Trump, who go to the bottom and they extol fascism, you’re hurting the most. We’re gonna make America great again. What did Hitler say in 1933? When he became Chancellor 84 years almost to the day after Trump and that’s a big cycle for us by the way. What’s the cycle?
Jason Hartman 40:40
What do you mean by
Harry Dent 40:42
Germany great. What do you mean the four year innovation cycle Okay, and populist movements cycle and politics is both at the same time? What did Hitler say? I’m gonna make Germany great again. Germany failed after World War One went through hyperinflation and went back From beyond compare, and then hit the Great Depression the early 30s. So what did Hitler say? I’m gonna make Germany great again. That’s what Trump is saying today. Trump is starting a revolution and it’s important. It’s kind of good what he’s doing. He’s shaking up thing, but the revolution does not ending up on the conservative or aggressive. We’re going to go back to the good old days edge. It always ends up in the progressive edge, just like the Civil War. It started with the south, which was more regressive and less progressive than the North succeeding from the union saying we can’t stand this progress anymore. And then guess what happened? We got more progress.
Jason Hartman 41:39
Yeah, it’s definitely an interesting time no question about it. Well, we will see how it all shakes out here. We give out your website and tell people where they can find you
Harry Dent 41:48
Harry dent, calm. Often you can get our book for free there with a shipping charge. We have a free newsletter economy and markets. So daily newsletter you can get to know us and then we have paid newsletters and stuff after that and and of course the book is now available on Amazon Zero Hour.
Jason Hartman 42:07
Okay, good stuff Harry dent. Thanks for joining us again.
Harry Dent 42:09
Thank you, Jason.
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