Harry Dent

Harry S. Dent, Jr. (born 1950) is an American economist and writer. His best-known book, "The Roaring 2000s", appeared on the New York Times Bestseller List.

Biography

Dent was born in Berkeley, California, United States, North America. [Most Recent Books written by "Harry S. Dent". Abunga.com. Retrieved on 2008-09-30 from http://abunga.com/?d=contributor&contributorid=000085321.]

Dent received his B.A. from the University of South Carolina, where he graduated #1 in his class. He earned an MBA from the Harvard Business School as a Baker Scholar.

Dent is the Founder of HS Dent Investment Management, an investment firm based in Tampa, Florida that advises the Dent Strategic Sector Portfolio mutual fund. Dent is also the president and founder of the H.S. Dent Foundation.

Dent writes an economic newsletter that reviews the economy in the US and around the world, as well as financial markets, and has written six books, of which the two most recent have been bestsellers:

* "The Next Great Bubble Boom" (2004)
* "The Roaring 2000s Investor" (1999)
* "The Roaring 2000s" (1998)
* "The Great Jobs Ahead" (1995)
* "The Great Boom Ahead" (1993)
* "Our Power to Predict" (1989)

The basis of Dent's research is the highly predictable nature of consumer spending based on a family formation pattern - minimal spending as young adults, spending more as raising children, peaking in that spending as children are leaving home, and then slowing spending during the last 15 years of working life (48-63) while saving more and preparing for retirement.

In the late 1980s, Dent forecast that the Japanese economy, then the darling of the world, would soon enter a slowdown that would last more than a decade. In the early 1990s, he predicted that the DOW would reach 10k. Both of these predictions were met with much skepticism, and yet both eventually came to pass.

In Japan, Dent was using their peak of 45-50 year olds (1990-1994) as the beginning of a long slowdown. In the US, used, and continues to use, the peak year for 48-year-olds, 2009, as the top of a long term growth pattern.

In 2000, Dent predicted that the DOW would reach 40k, a prediction which was repeated in his 2004 book. In his book, he also predicted the NASDAQ would reach 13-20k. In late 2006 he revised his forecasts to much lower levels, estimating the Dow would reach 16-18k and the NASDAQ 3-4k. In January 2006, he predicted that the DOW would reach 14-15,000 by the end of the year. It ended 2006 at 12,463, 11% below the lower end of his prediction. It ended 2007 at 13,264, again significantly lower than Dent's revised prediction of 15,000 by early 2008. Since then, the Dow crossed 14,000 in late 2007 before retrenching.

Dent popularized the baby boomer age-wave theory. [Siegel, Jeremy J. (2002-06-21). Stocks for the Long Run: The Definitive Guide to Financial Market Returns and Long-Term Investment Strategies, 3rd edition. New York: McGraw-Hill, 388 pp. ISBN 978-0-07-137048-6.] According to him, as a result of baby-boomers retiring, the stock-market should peak sometime between 2007 and 2009. It is based on his observation that spending peaks around age 50 for individuals.

Criticism

Dent makes heavy use of charts, cycles, and trends apart from his demographic theories in predicting short and intermediate term economic and stock cycles. His work is primarily based on the assumption that most long term stock market performance can be explained by studying long term trends and charts from the past. His critics question the assumption that clues to all major stock market events can be found in the relatively short history of well functioning stock markets in the world. His work has also been criticized for heavy use of data dredging- where it is easy to find patterns in past data and assign predictive powers to them when many such patterns occur in every data collection purely by chance.

While Dent's accuracy in calling long term demographic impact is impressive, his record on calling short term stock market behavior is patchy, as shown in his recent backtracking on his original predictions of Dow 40,000. In November 2006, Dent made a dramatic change to his forecast for the new 'bubble', now estimating the Dow topping at 20,000 and the NASDAQ at 5,000 by late 2009. The key reasons cited by him were geopolitical tensions.

References

Bibliography

* [http://tampabay.bizjournals.com/tampabay/stories/2006/01/02/daily39.html "Harry Dent forecast for '06: stocks ready to rally"] , "Tampa Bay Business Journal", January 5, 2006. Accessed January 22, 2006
* Laderman, Jeffrey M. [http://www.businessweek.com/2000/00_13/b3674175.htm "Call It a Boomer Boom: Demographics tells author Dent that the Dow will hit 40,000"] , "Business Week Online", March 20, 2000. Accessed January 22, 2006
* [http://www.hsdent.com/download/dow20000.pdf "Dent revises forecast and says Dow will only hit 20,000"] , "Harry Dent Website, November 11, 2006. Accessed November 11, 2006

External links

* [http://www.hsdent.com/ H.S. Dent Foundation]