(Kitco News) – Gold, which is trading for 2023 and is currently around $1,930 an ounce, will reverse the trend and have a sharp decline as the “biggest crash of our lifetime” enters its peak. second, according to Harry Dent. , Founder of HS Dent.
Dent calls for gold to reach $900 an ounce by mid-2024.
“Gold is not a safe haven,” he continued. “I expect gold to go down to $900 to $1,000. That’s going to be a lot lower than other commodities … it’s still 40 to 45 percent down from here.”
Dent’s track record includes correctly predicting the Japanese commodity bubble, the DotCom bubble, and the election of Donald Trump as President in 2016.
Dent said the “everything bubble” was caused by the Federal Reserve’s loose monetary policy, which led to a boom in most asset classes, especially stocks.
“From 2009 to the end of 2021 the growth of stocks was 120 percent,” he said. “It was lonely [The Fed] giving more and more incentive to make the stock market go up… That’s taking a toxic financial medicine, that when it finally goes down and crashes, you end up.”
He predicted a “massive crash” would occur, in an already bullish market, when the NASDAQ hit its low of 10,088 in 2022.
“I feel like the bottom for stocks at this point is probably going to be … July or so of 2024,” Dent said. “So, we’re still in the early stages. We need to break the last low … which is 10,088 to know that this crash is continuing and will go much deeper.”
“The next wave” downwards will occur when this critical level is reached, he added. From its all-time high, Dent expects the NASDAQ to fall 92 percent and the S&P 500 to fall 86 percent.
Gold, along with other assets, will reach $900 an ounce, but will eventually reach $4,000 after markets recover and further economic growth takes place, Dent said.
Dent spoke with Michelle Makori, Chief Anchor and Editor-in-Chief at Kitco News.
The Fed can’t fix this
The Fed, which raised interest rates by 425 basis points in 2022 to cool prices, won’t be able to prevent the market from collapsing, Dent predicted.
“To travel [Jerome Powell] turned around and stopped it, it’s going to look really ridiculous that it tightens up a little bit, and then has to turn around and go back to easing,” he said. “It’s going to prove how weak the economy is. and make the Fed look reckless. .”
He added that the Fed will lose credibility if it moves toward loose monetary policy.
“Once the Fed realizes that they’re tight after over-stimulating, and want to stimulate again, they’re not going to be very confident,” he said. “The government [printed money] long enough… that it’s not working now and it’s falling back on central banks.”
Although he suggested that it would be “wise” to stop the Fed’s tightening, he argued that it would prevent the inevitable collapse of equities.
“This economy just runs on spurring growth,” he said. “You don’t have to get stuck in this bubble. All you have to do is stop feeding this bubble. So, even if it stops, we won’t go back to normal. The stock market is still going. . the weak side.”
Another economic superpower
Dent, whose economic analysis revolves around demographic trends, predicted that India would emerge as the world’s economic superpower due to its growing population and large share of youth.
“India and South Asia will do much better than China [in the long-run]”He predicted. “One day, around 2050 or 2060, India will be the world’s largest economy and the US will still be slightly larger than China.”
Dent argued that China’s aging and shrinking population, coupled with overinvestment in buildings, would weaken its economy in the century.
“China is already at the peak of its demographics,” he said. “China will decline from 1.4 billion people to 770 million in 2100. They will be the first country to experience a peak and decline in demographic trends.”
He added that China has “overbuilt its economy… 22 percent of their houses and offices are empty. They are just making things to grow their economy. They are not printing money. They are printing condos.”
His prognosis for India was more positive.
“India is another super-sized country that can urbanize at 1 percent per year,” he said.
Although he predicted a lower gold price through 2024, Dent said India’s growth bodes well for the long-term gold price forecast. He specifically referred to gold consumption in the country, which is the second largest importer of gold in the world.
“If India is the biggest thing, gold will boom, because Indians buy and use gold for security and jewelry and everything else,” he said. “Therefore, gold, for fundamental reasons, will do well and rise in the next boom.”
Watch the video above to learn Dent’s long-term prediction for the price of Bitcoin, as well as how to predict the “big crash” he predicts.
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