Economist Warns 'Crash Of A Lifetime' Is Coming, Predicts S&P 500 To Plummet '86% From The Top'

Zinger Key Points
  • Harry Dent warns the "everything" bubble still hasn't burst, foreseeing a crash bigger than the Great Recession.
  • The economist predicts S&P 500 to drop 86% and Nasdaq 92%; Nvidia may plummet 98%.

Prominent financial author and economist Harry Dent remains steadfast in his December prediction of the “crash of a lifetime.”

In a recent interview with Fox Business, Dent warned that the current “everything” bubble has yet to burst and that the impending crash might surpass the severity of the Great Recession.

A 14-Year Bubble Yet To Burst

Dent highlighted the uniqueness of the current bubble, comparing it to the natural bubble from 1925 to 1929, which lacked the artificial stimulus seen today.

He likened the current economic stimulus to trying to cure a hangover by drinking more, indicating that continual economic intervention might enhance the economy long-term, but the true impact will only be revealed when the bubble bursts.

Dent emphasized that this bubble has persisted for 14 years, much longer than the typical five to six-year lifespan of most bubbles, leading him to expect a more significant crash than the one experienced in 2008-09.

The S&P 500 Index, as tracked by the SPDR S&P 500 ETF Trust SPY, is up 322% since June 2010, equating to a nearly 9% annualized gain.

“I think we’re going to see the S&P go down 86% from the top, and the Nasdaq 92%,” Dent told Fox Business.

Dent predicts that the S&P 500’s top-performing company Nvidia Corp. NVDA to fall by 98%.

He stressed that the government has maintained an artificial bubble for an unprecedented 15 years, and history shows that all major bubbles eventually end badly.

Real Estate Market At The Bubble’s Core

Dent placed the real estate market at the core of the bubble, forecasting that housing prices would drop to 2012 lows this year.

He noted that U.S. home values have already doubled or more, beyond what they will soon be worth. He remarked on the widespread homeownership and speculative buying of second and third homes, and pointed to similar trends in countries like China and Japan, where residents are purchasing empty properties as potential market crash collateral.

Dent advised against buying expensive homes at the market’s peak and cited historical downturns from 1929-1942 and 1968-1982 as examples. Without the $27 trillion stimulus, he suggested the downturn from 2008 to 2022 would have been more severe.

Addressing critics who label his predictions as fearmongering, Dent defended his stance, emphasizing his commitment to truth over popularity. He rejected the “perma-bear” label, arguing that the power of central banks to print money has created an unprecedented bubble. He asserted that long-term trends are easier to map than short-term fluctuations.

Dent advised investors to seek refuge in the safest bonds available, suggesting the U.S., as the largest economy, will endure the downturn.

Read now: Fed Meeting Preview: Economists Predict Steady Rates In June, Fewer Cuts Ahead

Photo: Shutterstock

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