February 19, 2016

y r a u FEBR ue Iss

Inside This Issue The Bombs Exploding Page 2

Brothers In Arms Page 4

Already Bankrupt Page 5

The World’s 800lb Elephant

Page 7

The Banking Crisis 2.0: Global Edition Deutsche Bank the Next Lehman… Italy Too Big to Fail… And the China Dirty Bomb

T

HE markets were spooked downward into February 11, mostly thanks to mounting global fears about banks. The flagship German Deutsche Bank, with its ever-increasing non-performing loans, and Italian banks even worse, dominated the headlines. Vying for attention was Japan’s move to negative interest rates and the surprise pop in the yen, which just hurt their exporters and stock market more. Seriously, when will these douchebags get it? Off-the-charts stimulus has done nothing to revive Japan’s coma economy, except in brief spurts. It’s done little for our near-recessionary economy either! Things are getting out of control, as they inevitably do when you keep a “something for nothing” bubble going on pure stimulus. Then Kyle Bass tells CNBC viewers that China’s bad-debt crisis is five times worse than the subprime loan crisis and will require the printing of $5 trillion to $10 trillion just to recapitalize the banks. This will result in a 15% to 30% devaluation of the yuan that would send shock waves around the world. Commodity exporters (who are already ailing) and global banks that lent money to Chinese companies are staring catastrophe in the eye. Kyle’s a smart guy! But wait! Markets have rallied since then. When Mario Draghi, Japan, and other governments pledge more stimulus, and Janet Yellen says the Fed will at least look at negative interest rates… the markets are happy. Any crack addict gets happy when he’s promised more crack!

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My response: What absolute B.S.! It’s totally delusional.

That changes nothing! Central banks are finally losing control over their economies. They created the monsters with their endless stimulus and free money. Now their monster is breaking free and about to wreak havoc.

The problem is that these highly leveraged financial securities are used as insurance but they have zero collateral behind them. So they’re nothing like regulated insurance policies in the real world. When a speculator who vows to insure can’t pay — because they’re losing money in high-leveraged speculation — then what? Then the total liability lands on the table and there’s no balancing out… just like Lehman Brothers and AIG in 2008.

So, in this issue of The Leading Edge, I’ll give you details about the most distressed major global banks, the growing debt and banking crisis in Italy, and the unprecedented China debt bubble (the dirty bomb)… all to show you that, despite central bank arrogance and blindness, the Banking Crisis 2.0: Global Edition has already started… and it’s only going to get worse from here.

Credit default swaps were just another magic trick on Wall Street to create the appearance of greater risk management in an increasingly levered world. They bundled all types of questionable loans into “diversified packages” and insured them with B.S. credit default swaps. And rating agencies often looked the other way and AAA-rated this crap because they had to kiss the ass of their best customers on Wall Street.

The Next Lehman Brothers You know the reputation that Germany, Switzerland and Austria had for sound banking? Well, they’ve turned that on its head. Now they have the dishonor of leading the great global debt bubble as it bursts. Banking and investment banking in those countries have gone nuts. They’ve become speculators, not bankers or business builders.

If you haven’t seen The Big Short movie yet, see it (but only after you’re done reading this issue). Just remember when you’re watching it: the reality was far, FAR worse than what the movie portrays.

Most people think major U.S. banks like J.P. Morgan at $51.9 trillion have the highest exposure to the more than $550 trillion derivative market (that’s not a typo!). They’re wrong. That title goes to Deutsche Bank. It has $54.7 trillion in total derivative exposure. That’s 20 times Germany’s GDP, for crying out loud. This compares to $51.2 trillion at Citi, $43.6 trillion at Goldman Sachs and $27.8 trillion at Bank of America. And you thought German banks were more prudent. Ha!

All this financial chicanery went south in 2008, bringing the entire system to its knees… very nearly breaking it entirely. And now it’s all starting to happen again. So much for learning from past mistakes! Deutsche Bank has posted its highest loss ever of $7 billion from bad loans and investments, many of them highly leveraged, and there’s much more to come. Of course, it doesn’t stop there.

There’s More Than One Bomb Exploding

Do you want to see a more responsible big bank in the U.S.? Wells Fargo only has $6.1 trillion derivatives exposure and that’s why its stock valuations are the highest, as I’ll show ahead.

There’s another financial magic trick that’s blowing up with Deutsche Bank…

When global derivatives peaked at $700 trillion in 2012 they were 10 times global GDP! In response to this little detail, the slick gunslingers on Wall Street say: “Oh that’s nothing to worry about. Those derivatives are mostly insurance for lenders and bond buyers, courtesy of financial institution speculators — and the longs balance out the shorts.”

Part of the recapitalization after the great recession from 2008 forward was to issue additional equity. But that’s really expensive and dilutes shareholder stake… a double whammy after already losing more than 80% when the stock crashed. So the next best thing is to issue senior debt, but that also comes ahead of 2

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shareholders and hurts them. That was a no go. The easiest way to raise capital was to issue CoCo bonds or a new second level of senior tier-1 debt! Ingenious. Let’s keep the bubble going! 102 billion euros (the equivalent of $113 billion) of these bonds have been issued since 2013. Listen to this one. Deutsche Bank, for example, issues (present tense because it still does this) 6% high-yield bonds that are somewhat senior. But they’re callable (if things improve they avert such high interest in the future) and convertible into stock (if things go bad and the bank can’t pay the interest). Here’s the clever part: not paying the interest isn’t considered a default and they don’t have to later pay back any interest payment they miss. Is this what we have to do to get a decent yield in the zero interest rate economy? Far too many investors think so. Unfortunately, these bonds turned out to be much riskier than desperate investors thought. They, like everyone, are being forced to chase higher yields to meet retirement income, pension targets, and so on. But banks don’t care! These bonds are structured totally in the bank’s favor, not the investors. When things go bad, the bank gets out of paying interest and the investors get stuck holding a dud stock. These bonds have not defaulted yet, but their price has already gone down over 30% in anticipation just recently. Here are two charts that tell the story of Deutsche Bank, the current poster child for this new banking crisis… Deutsche Bank Stock Crashes

Down 89% From 2008 High, and 59% From 2015 High 120 100

-89%

80 60 -59%

40 20 0 2008

2009

2010

2011

2012

2013

2014

2015

2016

SOURCE: Yahoo! Finance

With that 2015 $7 billion loss — higher than any time in the great recession — and questions over the ability to pay their CoCo bonds interest, Deutsche Bank’s stock crashed. As of February 11, it was down 89% from its early 2008 peak. It’s down 59% from its more recent 2015 high. Deutsche Bank CoCo Bonds Crash 450 400 350 300 250 200 150 12%

Deutsche Bank’s 5-year CDS Spread Doubles

11%

DB’s CoCo Yields Soar as Investors Lose Confidence

10% 9% 8%

12/31

1/8

1/15

1/22

1/29

2/8

7%

SOURCE: Bloomberg

Note that another major bank in Germany, Commerzbank, is down a whopping 97% since 2008 and 44% since 2015. Since January 1, the 5-year CDS (credit default swap) spread in rates to insure (or look like insurance) its CoCo bonds more than doubled from 1.87% to 4.38%. Most of that change has happened since January 28. The yields on those 6% bonds had risen moderately since 2013 up to 8% at the beginning of this year, but then suddenly spiked up to 12% into February 11. How do you like them apples? Even everyday investors were fooled into buying these risky bonds. The largest bank in Germany couldn’t possibly go under. The German government would never allow it. What a joke. And what a mess. Deutsche Bank will sell off assets and employ other strategies to live as long as they can… and the German government will no doubt support the bank every way it can, but Deutsche Bank is already dead. It’s just that no one has announced the funeral yet! Since this crash, it’s rumored that Deutsche Bank

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may buy back up to $3.34 billion in senior bonds above the CoCos. That would reduce their leverage and be a show of strength. Just a show. It will change nothing. And Deutsche Bank has substantial exposure to the fracking industry in the U.S. and to Chinese companies. Both terrible, terrible places to be involved in right now! The bank’s CEO has strongly stated that the institution is totally sound. Yeah right! They all say that before the final curtain.

This picture is ugly and it’s only the beginning of the next, even greater financial crisis and deflationary deleveraging. As you can see, Deutsche comes in at 59%. UBS in Switzerland is the prettiest ugly sister at this party at 180%, while Italy’s Banca Carige is at a shocking 3% share value to book value. Clearly Europe is leading this banking crisis. To get a better view of this, consider the stock prices since 2008 of four major banks in Europe and one in the U.S. Stocks are one of the few leading indicators that still work to some degree in this artificial economy.

The truth is that such a move would deplete the very cash they need to pay those CoCo bonds and absorb increasing losses if the world economy gets worse — and it will get worse!

UniCredit is the worst in this large-bank group. It’s down 91% from its 2008 high and 58% from its 2015 high, as you can see in this chart.

Allow me the liberty of tweaking this classic quote: the road to hell is paved with… greed and fraud.

UniCredit Stock (Italy) Decimated

Down 91% From 2008 High and 58% From 2015 High

Brothers in Arms

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I’ve beaten up on Deutsche Bank here, but this problem doesn’t stop with them. They’re not even the worst news. Look at the chart directly below. It shows how badly many western bank stocks have been hit. It measures their current share value versus their book value or net worth at cost. Normally stocks trade well above book value (the higher the number the better), often many times more in a bubble like this one.

25

-91%

20 15 -58%

10 5 0

2008

2009

2010

2011

2012

2013

2014

This is more proof of the crisis unfolding… Banca Carige (Italy) Commerzbank (Germany) Banco Popolare (Italy) UniCredit (Italy’s Largest Bank) Standard Chartered (U.K.) BNP Paribas (France) Bank of America (U.S.) Citigroup (U.S.) Banco Santander (Spain) Deutsche Bank (Germany) Mediobanca (Italy) Credit Suisse (Switzerland) Morgan Stanley (U.S.) HSBC (U.K.) Goldman Sachs (U.S.) JP Morgan (U.S.) Wells Fargo (U.S.) UBS (Switzerland)

2015

2016

SOURCE: Yahoo! Finance

3% 28% 29% 35% 38%

Many Global Bank Stocks Have Been Crushed Already Share Price to Book Value

53% 54% 54% 58% 59% 61% 63 % 65% 69% 87% 95% 137% 180% SOURCE: Bloomberg, Yahoo! Finance



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Banco Santander of Spain has fallen 83% since 2008 and 57% since 2015. Credit Suisse has seen a 79% and 58% plunge, respectively. HSBC in the U.K. has fared the best, down only 66% since 2008 and 40% since 2015… but the U.K. has the highest global bank debt exposure, so don’t take this as good news. Even though U.S. banks have had a better recovery and easier and faster recapitalization, Citi has never really recovered from the massive crash in 2008. It’s still down 88% from that top and 43% down since its recent high in 2015. Clearly the next banking crisis is rearing its ugly head. This time it’s starting in Europe, where the next major sovereign default looks likely in Italy... the country considered too big to fail.

Italy: Already Bankrupt but Too Big to Fail The other big news recently was that the ECB and IMF finally reached an agreement to sell the worst loans from Italian banks to private investors… but with government guarantees. Brilliant! Another financial magic trick and cover-up. How many more rabbits can they pull out of a hat? Why can’t any government do the obvious (and best thing) and force banks to write-off or restructure bad loans and have their stock and bondholders take the damn losses? It’s just such short-sightedness on their parts! The response to the bubble burst since 2008 has been more and more free money and stimulus and more and more government guarantees. What government can guarantee everything if things go wrong? Not a single one. Bank deposits, mortgages, major corporations and banks, CoCo bonds… where does it end? Many major government sovereign bonds will eventually come into question. It’s inevitable. They have massively unfunded obligations like health care and retirement benefits they can never hope to pay on top of common debt ratios 100% or higher.

I’ve been talking about the massive debt and overbuilding bubble in China for years and it finally seems to be bursting — more on that ahead. But mark my words: the next trigger for a global debt crisis and deleveraging — worse than 2008-2009 — is likely to come from Europe, especially from Italy. Look at this next chart. It shows non-performing loans in the worst demographic and competitive area in Europe: the southern region (excepting Ireland). Italy’s Bad Loan Problem

Non-Performing Loans, Percent of Total Loans, 2015

Greece Ireland Italy Portugal Spain 0%

5%

10%

15%

20%

25%

30%

35%

SOURCE: The Economist

No surprise here, Greece is first with 34% nonperforming loans. That is beyond bankruptcy and after many bail-outs. Ireland is second at 19%. But now look at Italy. It has grown from 8% in 2010 to 18% currently. That’s well ahead of Portugal and Spain. When non-performing loans get to 10%, most banks are technically bankrupt because they typically only have around 10% in reserve (all that’s required) and/or capital against loans. On top of that, Italy’s labor productivity has fallen from an index of 110 to 96. That’s 13% down since 2000. Its real GDP per capita has gone down 12% since 2004. Its labor costs have risen modestly, instead of typically falling after a debt crisis and recession. Not a good story here folks! Rising debt and falling income. Italy has been in recession five years out of the last eight and is back there again, despite Mario Draghi’s QE bazooka and guarantees. The country has the lowest college education levels

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of the major European nations, high taxes and reams of red tape, and an overwhelming underground economy that’s stifling legitimate businesses. Many Italians migrate out to get better jobs. Of those that stay, nearly 70% work for firms with less than 50 employees. Tax evasion is common because the government taxes wages more than it does spending. Bribes are a necessity to get even the most mundane things done in its bureaucratic government.

The bottom line: Italy is way too big to fail. But the ECB, the euro and euro zone simply cannot bail it out. So the euro zone economy will continue to fail. That’s the only scenario I see, especially with demographic trends so weak in the region for years and decades ahead. The ones most in trouble thanks to dismal demographic prospects ahead are Germany, Italy, Greece, Portugal and Austria — in that order. This is not going to end well.

Italy is clearly the next domino to fall in the euro zone and it looks increasingly imminent.

As things get worse in Italy, Germany will likely advocate the same approach it did with Cyprus — a “bail-in.” This is where larger deposits are converted to stock to cover the bad loans (like the CoCo bonds).

Remember Italy’s leading bank, UniCredit, has crashed 91% since 2008 and 58% since 2015. Well, look at the worst leading bank failure there: Banca Carige. It’s stock price has lost 99% since 2008 and 82% since 2015. Banco Popolare is down 92% since 2008 and 62% since 2015. Talk about blood in the streets.

But who wants stock in a dying bank? Seriously!? Non-performing loans in Cyprus in 2013 got as high as 51% before its bail-in. Today such non-performing loans are still 45.85%, or $30 billion. None written off and only a minor 19% restructured.

Because Italy’s government debt never enjoyed relief from bailouts, it keeps rising. It’s currently 139% of GDP. It’s the highest of the top four debt-toGDP ratios in Europe and is only exceeded by Greece. Its private debt is not as extreme as many, so its total debt is 335% of GDP, but that’s still high, especially given its recessionary bias in the last eight years and its falling productivity and GDP-per-capita levels I mentioned earlier.

That Cyprus bail-in took 47.5% of deposits — over $111,000 (100,000 euros) — largely hitting corrupt Russian oligarchs and larger small businesses. Not too long ago I did an interview with Lydia Kyriakidou on Radio Paphos in Cyprus. She stated that most small businesses have never recovered from that debt crisis and bail-in. She knows from first-hand experience. She’s a small business owner!

As Rodney commented recently, the solution to these non-performing loans, which total $382 billion, is first to sell them to private investors with government guarantees. This is now happening, as announced recently. But the ECB is also considering allowing such bad loans to be pledged as collateral for loans to Italy… and then Italy simply doesn’t pay the loans back, leaving the ECB holding the bag. If this happens, the citizens will be stuck with much of the loans in the end — yet another financial magic trick.

The euro zone will never have a chance at recovery until they face the music and restructure debt. And the euro will have to restructure. One option would be to create two euro currencies. The first would include the stronger exporters and the second the weaker importers/debtors. That way the stronger currencies could cure the trade imbalances. On top of the debt crisis, the migrant crisis is threatening the open borders of the euro zone.

These are just more desperate short-term measures to deflect the debt crisis and to avoid having someone actually take the losses and restructure the debt. Keeping such zombie debt and banks in the system weighs it down and makes a sustainable recovery impossible, something Japan has now proven for over 26 years. Do you need more evidence than that?

The bottom line is that the euro and euro zone will not survive a debt crisis in Italy; not in its current form, with its current policies. This will be the end of endless QE and guarantees of bad loans. These governments and countries just have to man-up, write down the damn debt and be done with it! 6

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The 800 Pound Elephant in the World

But a major event happened that few have noticed. China’s huge migrant population fell for the first time in almost 30 years in 2015. Look at the next chart.

Last, but not least, comes China. As I’ve said many times before, it’s natural for emerging countries to drive their economies from the top down as they urbanize. They invest heavily in infrastructures to speed up that urbanization, which carries a typical 3:1 ratio of incomes in cities versus rural areas. There’s no faster way to create higher GDP growth and incomes than that!

Migrant workers dropped 5.68 million to 247 million last year. This follows growth rates falling two million a year since an annual peak of 12 million in 2010. So it’s gone from 12 million a year growth to a decline of nearly six million in just five years…

This is why I focus on urbanization rates in emerging countries even more than I do demographic trends. Urbanization fosters the most powerful principle of economics: the specialization of labor. This is what most creates higher paying and better job opportunities. The problem with China is it did the communist trick of total top-down central control and planning — the polar opposite of free-market capitalism and democracy that has made developed countries so rich. The Soviet Union tried this. It failed miserably. China’s attempts aren’t looking so good anymore. Trump recently called Bernie Sanders a communist. No, Donald, the past Soviet Union and the Chinese today are communists through their topdown centralized planning and control. Bernie is a redistribute-the-wealth socialist (as are countries like Sweden and Denmark). China has created over half a billion new urbanites in 30 years. This is the greatest scale of urban migration in modern history (Japan, South Korea, Taiwan and Singapore have been the fastest and most successful in income creation). The Red Dragon has driven a strong export and high fixed-investment strategy for twice as long and twice as high as the tiger countries did into the late 1990s: Japan, South Korea, Taiwan and Singapore. Its fixed investment is still 50% of GDP, while Japan and South Korea averaged half that and never exceeded 30%... China is a huge, still-poor, emerging country on “steroids.” My estimate is that it has overbuilt its real estate, infrastructures and industrial capacity 10 to 12 years out at current rates of high urbanization.

China’s Urban Migrant Workers Go Back Home

Like China’s Workforce, Migrant Population Begins to Slide  Migrant Workers, left

 Working-Age Population, right

Millions

Millions Migrant Workers Decline for the First TIme in 30 Years

255

945 935

245 925

235

915

225

905

215 205

2010

2011

2012

2013

2014

2015

895

SOURCE: China National Bureau of Statistics

And workforce growth (16 — 64-year olds) has been declining since 2011. It fell 4.87 million in 2015 alone and a total of 30 million since 2011 (it will decline much faster after 2025). Who is going to buy all of those empty condos or use all of the excess infrastructure and industrial capacity? Certainly not those migrant workers. They’re moving back to the rice paddies. They’re unregistered in the cities where they work, so they don’t have access to education, health care or minor welfare benefits. They go back to their rural areas to visit parents (who are maybe taking care of the grandchildren due to lack of education access and cost of living in the city). The contrast of cleaner air, safer food, natural beauty and higher wages in these rural areas causes some to simply decide not to go back to the hellish realm they worked in.

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I have warned for many years that the greatest disaster in the world is these 250 million unregistered citizens trapped in cities when the overbuilding and work disappear. What are these people going to do? They can’t all go back to their farms because many have been paved over with empty condos!

How is this massive debt sustainable when so much of it went into creating empty capacity? It’s not. 50% of loans in China are tied to real estate. In fact, the country’s personal wealth is far more concentrated in real estate (74%) than any other major emerging or developed country. Its real estate has gone up by six to eight times in leading cities since 2000. And the rich are shipping their wealth out of the country as fast as they can, largely by buying real estate and businesses overseas. That’s not good for the country!

And how did China accomplish such unprecedented over-building and urbanization? Through massive debt, of course. China’s total debt has grown 15 times since 2000 — from $2.1 trillion to $30.5 trillion (some estimates put that number as high as $32 trillion). Its total debt has grown 3.6 times GDP for 16 years (during the U.S. debt bubble our debt-to-GDP only grew at 2.5 times). The greatest portion of this is attributed to corporations that are using government-backed loans to overbuild everything. Corporate debt expanded from 72% to 125% of GDP just from 2007 to 2014. I expect much of that debt to go bad.

Note that China’s total debt-to-GDP is 295% two to three times other BRICs like Brazil, Russia or India. It’s actually very near levels seen in most of the wealthy developed countries. Remember, emerging country debt ratios are typically far lower than developed countries because their households have much lower incomes and are less credit worthy, as are businesses that deal with them.

Financial sector debt has grown from 24% to 65% in the same seven-year time period. Talk about shadow banking and the most vulnerable debt!

There’s no doubt in my mind that China is going to see the greatest debt crisis and bubble burst of any major country in modern history. It may be the last to fall thanks to such strong top-down government control and lack of accountability, but it WILL fall. And when it does, it’ll go down like an elephant. There will be no soft landing. The impact will send devaluation and deflation shock waves around the world as debt deleverages and overcapacity overwhelms.

Take a look at this next chart… China’s Debt Has Exploded by 15 Times Since 2000  Household

 Corporate

 Government

Trillions $28.2T or 282% of GDP

300%

 Financial $30.5T or 295% of GDP

So to summarize…

38%

250%

European banks, which were slower to recapitalize in a much weaker economic recovery, look likely now to trigger the next global debt crisis. The frackers and energy companies will contribute as well, and remember: many large European banks are more exposed to that than most would assume.

200%

150%

$7.4T or 158% of GDP $2.1T or 121% of GDP 8%

20%

72%

100%

125%

Italy is where the banks and economy are weakest, so they’re the next country to collapse. But it’s too big to fail so the euro zone countries and the ECB will ultimately have to make investors take the hit rather than their own citizens. The euro and euro zone will change and restructure dramatically.

55%

83%

50%

0%

42% 23% 7%

24%

2000

2007

65%

2014

2015

And all of this will set in motion the largest debt

SOURCE: “Debt and (Not Much) Deleveraging,” McKinsey Global Institute, February 2015



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and financial asset bubble burst of them all: China.

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Subscribers in Australia and East Asia beware. You will feel this tsunami far more than we will in the U.S.

them each month. Listen to the Ahead of the Curve webinars we send you. Read your weekly 5-Day Forecast (on Mondays) and Digest (on Fridays). Watch the monthly Insight videos Rodney records. And pay attention to what our investment gurus like Adam O’Dell, Rodney, John Del Vecchio and Lance Gaitan are saying in their respective services.

So don’t wait too long to sell any stocks, real estate or financial assets that are vulnerable. If you’re planning to sell at some point, do it over the next few weeks, during the present stock bounce. And be sure to read your Boom & Bust issues as we release

All of us are determined to help you avoid financial injury during this crisis. And we want to help you take advantages of all of the opportunities that arise in this kind of environment. In fact, it’s in times like these that fortunes are made.

When China goes down and has to face its massive overcapacity and debt, we will fully see the next great depression and it will be ugly!

DISCLAIMER: The Leading Edge: Harry Dent Unfiltered is published six times per year for US$295/year by Delray Publishing, 55 NE 5th Avenue, Suite 200, Delray Beach, FL 33483, USA. For information about your membership, contact Member Services at 1-888-211-2215 or fax 1-410.223.2682. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This Newsletter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the worldwide web), in whole or in part, is strictly prohibited without the express written permission of Delray Publishing. LEGAL NOTICE: This work is based on SEC filings, current events, interviews, corporate press releases and what we’ve learned as financial journalists. It may contain errors and you shouldn’t make any investment decision based solely on what you read here. It’s your money and your responsibility. The information herein is not intended to be personal legal or investment advice and may not be appropriate or applicable for all readers. If personal advice is needed, the services of a qualified legal, investment or tax professional should be sought. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication or 72 hours after the mailing of printed-only publication prior to following an initial recommendation.

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About Harry S. Dent Jr. Harry studied economics in college in the ’70s, but found it vague and inconclusive. He became so disillusioned by the state of his chosen profession that he turned his back on it. Instead, he threw himself into the burgeoning New Science of Finance where identifying and studying demographic, technological, consumer and many, many other trends empowered him to forecast economic changes. Since then, he’s spoken to executives, financial advisors and investors around the world. He’s appeared on “Good Morning America,” PBS, CNBC and CNN/FN. He’s been featured in Barron’s, Investor’s Business Daily, Entrepreneur, Fortune, Success, U.S. News and World Report, Business Week, The Wall Street Journal, American Demographics and Omni. He is a regular guest on Fox Business’s “America’s Nightly Scorecard.” Harry has written numerous books over the years. In his book, The Great Boom Ahead, published in 1992, he stood virtually alone in accurately forecasting the unanticipated boom of the 1990s. In 1998 and 1999, he authored two consecutive best sellers: The Roaring 2000s and The Roaring 2000s Investor (Simon and Schuster). In The Next Great Bubble Boom, he offered a comprehensive forecast for the following two decades. In 2008, he wrote The Great Depression Ahead, which he forecast to occur from 2008 to 2013. Then in The Great Crash Ahead, he outlined how there is nothing the government can ultimately do to prevent the inevitable deflationary period ahead. Harry’s latest book, The Demographic Cliff: How to Survive and Prosper During the Great Deflation of Ahead, shows why we’re finally facing a “great deflation” after five years of stimulus — and what to do about it now. Today, he uses the research he developed from years of hands-on business experience to offer readers a positive, easy-to-understand view of the economic future. Harry got his MBA from Harvard Business School, where he was a Baker Scholar and was elected to the Century Club for leadership excellence.



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