The Great Crash Ahead
A New Book By: Harry S. Dent, Jr.
(Free Press, release date late December 2008)
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TAMPA, Fla. (Dec. 5, 2006) – The largest generation in U.S. history is about to retire, wreaking havoc with our economy from two different directions. In a special report, “Death of Pensions,” Harry S. Dent, Jr., founder and president of the HS Dent Foundation warns that the level of payments promised to future retirees cannot possibly be paid, affecting not only private sector workers but also civil servants.

According to Dent, the effects of this situation will not only cause private and public pensions to lower benefits, but will also drive states and local governments to raise taxes in an effort to pay what they have promised. At the same time, Dent estimates that slower spending by aging Baby Boomers will cause an economic slump after 2010, compounding an already difficult situation.

Retirement benefit systems of all types are in crisis mode. “It is a fact that U.S. companies absolutely cannot pay all of the pension and healthcare benefits that they have promised to their workers,” Dent states. “The statistics barely skim the surface. While the number of underfunded plans is startling, the degree to which some are underfunded is staggering.”

To understand the scope of the problem, examine General Motors (GM), for example, suggests Dent. Today, GM has almost $100 billion in their pension fund, but GM is underfunded by more than $7 billion – which doesn’t include retiree health benefits. Health benefits are totally unfunded, which adds another $60 billion to the GM deficit. With a market capitalization of roughly $17 billion, GM could give itself away to its current and future retirees, and the company would still owe them over $50 billion. “A similar scenario, although not as dramatic, applies to the pension funds of many companies and government entities throughout the U.S. The economic implications of pension and healthcare benefit shortfalls are serious,” Dent cautions.

Many people believe that the federal government will rescue pensioners and provide needed healthcare benefits. This is unlikely as consumer spending cools after 2010 and tax revenue from corporations fall. Wage growth will slow as well, which reduces tax revenues from individuals, warns Dent. “In the resulting stock market decline, there will be little revenue from capital gains or dividend taxes. Revenues will fall, but regular discretionary spending and entitlement spending for Social Security and Medicare will soar,” Dent said. “Bottom line: Congress won’t have the funds to bail out the state and corporate pension plans.”

There is no doubt that significant hurdles lie ahead. “If Baby Boomers want to maintain a reasonable standard of living during their golden years, they should start preparing NOW,” Dent stresses. “You absolutely must increase savings, preferably in a tax-favored plan. Income taxes are likely to be significantly higher in coming years; therefore, expect a higher tax bracket in retirement. Look to Roth IRA or the new Roth 401(k) as vehicles to save retirement money while reducing the income tax burden in later years. Health Savings Accounts (HSA) can also save on medical expenses over time. Another strong consideration should be a variable annuity, with guaranteed benefits.”

Rather than focus on problems, responsible members of the U.S. economic community must take immediate action. “Elected officials should be urged to resolve the fiscal issues that are looming for Social Security and Medicare,” Dent advocates. “In addition, government programs for saving and managing retirement income and medical needs should be fully utilized. And most importantly, plan for the financial future today by increasing savings, seeking informed financial advice, and selecting investments designed to protect retirement assets during the volatile years ahead.”

To obtain a copy of “Death of Pensions,” purchase it on the online store at http://www.mossohsdent.com/, or contact Nicole Nonnemaker at 1-888-307-3368.

About HS Dent:

HS Dent (http://www.mossohsdent.com/) of Tampa, Fla. helps people understand economic change and prepare for its arrival through HS Dent Monthly Economic Forecasts, Special Reports, Demographics School and its Financial Advisors Network. The Dent methodology, which is based on the study of demographics, or the study of whole populations and their spending habits, takes financial forecasting out of the world of theory and into the realm of real-world consumer behavior, allowing investors to make intelligent and informed economic decisions about their future.

Harry S. Dent, Jr. to Discuss Economic Outlook in Dubai
(November 7, 2006)
Joins Colin Powell, Michael Eisner, H.M. Queen Noor and Other Dignitaries at Leaders in Dubai Business Forum

TAMPA, Fla. (Nov. 7, 2006) – Economic forecaster Harry S. Dent, Jr. is among seven renowned political and business dignitaries who will speak at the 2006 Leaders in Dubai Business Forum. Scheduled for Nov. 28 and 29, the forum will be held at the Dubai International Convention Center.

Dent, who is the developer of The Dent Method, an economic forecasting technique based on real-world demographic trends, will speak on “Predicting the Economic Future.” As part of his address, Dent will discuss the full spectrum of changes to follow in the wake of the burgeoning turn-of-the-century economy. He will also address why most economic forecasters are wrong, and what is likely to occur during the “Next Great Bubble Boom” of 2006-2010.

Other key speakers and topics include:

• General Colin Powell, former U.S. Secretary of State, on “Taking Charge”
• Michael Eisner, former chairman and CEO of the Walt Disney Company, will speak on “Growth through Innovation”
• Louis V. Gerstner, Jr., former chairman and CEO of IBM, will speak on “Leading Change”
• Her Majesty Queen Noor, on “Leadership and Public Service”
• C.K. Prahalad, one of the world’s foremost authorities on business strategy, will discuss “Corporate Strategy”
• And Edward de Bono, an internationally renowned authority on creative thinking and innovation, will speak on “Creative Thinking” For more information on the 2006 Forum and for registration details, visit www.leadersindubai.com. About HS Dent:HS Dent (http://www.mossohsdent.com/) of Tampa, Fla. helps people understand economic change and prepare for its arrival through HS Dent Monthly Economic Forecasts, Special Reports, Demographics School and its Financial Advisors Network. The Dent methodology, which is based on the study of demographics, or the study of whole populations and their spending habits, takes financial forecasting out of the world of theory and into the realm of real-world consumer behavior, allowing investors to make intelligent and informed economic decisions about their future.

  For more information, please contact:
  Stephanie Gerardot
  972-396-1733
  sgerardot@hsdent.com