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HS Dent CEO Harry Dent on how concerns of a decline in consumer spending and economic growth will impact investors.
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Just into our at the third quarter US GDP is being revised upward from 2% to two point 7%.
But what economists -- enjoy it while you can't even this -- rate is the best we're gonna see for quite awhile.
Harry -- is the CEO of HS -- joins us now for an investor Harry who's listening to that.
How would make money off that that prediction that belief.
What you know that the markets look like it's rallying over -- unlikely revolution of the fiscal -- I think they're probably will be in the next month or so.
But you know.
We've been surging from all the stimulus but we've have a leading indicator from consumer metrics -- -- a bit.
Looks at real time spending on the Internet so you're really catching retail right the very beginning.
Before any slowdown hits you know the rest of the business chain and it says to expect the slowdown in consumer spending into the fourth quarter and first quarter and you -- the markets aren't expecting this most investors aren't expecting it so.
You know ride this rally -- there we look at stocks may be going up another 10% but especially this happens sooner than later.
Then I would be looking to get out of stocks or to be short the stock market.
By the way we just talked to -- -- about another factor that might actually increase spending in this holiday season and that would be all the dividend checks that are going to be coming in because everybody's front loading dividends.
Expecting taxes to go up.
That -- billions of dollars will be in the economy at use just at the right time when people are shopping so isn't that could have a positive effect.
On retail maybe you should wait until after after the holiday season short these retail.
Yet there are no I think so again we do think stock's gonna head up for a number reasons and that is another good one.
I think the first quarter is what is when we have more vulnerability somewhere early next year.
And and got another thing we see is that baby boomers average person about 80% of people peak.
Around age 46.
But I've -- -- 10% peak about five years later and they're the ones still spending even though they're only 220% of the economy they're 50%.
Of consumers spending and a bigger part while so.
I think that shoe about about a five your -- I think demographics is going to give the economy another hit.
Some time next year that's harder to to pinpoint but I do think we do think.
We've seen is -- growth is we're gonna see for a while and by the first quarter you're gonna see a slowing.
Well look after a holiday spending that that would be understandable we just Chad Steve tanner tanner outlets they had a record of Black Friday we've heard this.
From a number of companies the online business did beautifully overall across the nation.
And consumer confidence is is bad multi year highs so Harry I mean isn't this the time where he would say let me get in some really great names.
Well you know -- you can't look at consumers they just reflect what's happening now.
Things are okay.
For most people but we are seeing signs -- we track stocks like Tiffany's and Nordstrom's and other -- stock.
They're not doing so well yet and there are there -- these look like they're picking.
We're more focused on at the high end slows down and spending not because they think the economy back but because they're kids are getting out of college and they don't need to spend as much money.
That's that's what we're looking -- -- and we're just gonna keep monitoring this for now.
On the -- this leading indicator assume that there's something a little wrong here it's gonna show by the first quarter -- yeah.
Christmas there's no reason Christmas is going to be bad and certainly not for the -- low end real -- to doesn't look like.
-- it's not often that a rich investor worries a lot about income disparity income inequality but you do tell us why.
We -- the US has this more than any developed country -- more than Australia Canada most countries in Europe.
Our top 1% and our top 10%.
Garner much higher income.
As a percentage of economy and a much higher percentage of wealth and assets so.
Did this should people talk about raising taxes on the top one to 2% -- won't make that much different the top 1% control 40% of the wealth.
20% of the spending the top 10% controlled almost 50% of the spending.
It is going to make a difference have they raise taxes so.
So what we were about this more and we do think these people they peak in the early fifties instead of their mid forties we think there are set -- naturally peak.
Everybody slows down it doesn't matter how rich you are very few people spend more money after their kids got to college and you don't have to invest so much in your kids anymore.
Harry Dent HS that CEO and author of the book the great crash ahead there's of copy of the book.
He sees it -- thanks very good to see --
