Popular American economist Harry Dent, says that Australia is heading for a crash and that expensive real estate prices are going to make it worse. Dent told The Daily Mail Australia that he believes that high real estate prices will expose Australia’s big banks to a huge risk of collapse, unless the government bails them out.
He said it is concerning that China is Australia’s largest trading partner, as he believes that China will be “the biggest bubble to burst.”
He also added that the Australian stock market is the second-most overvalued in the world.
Dent warned that the crash will be on the level of the 1929 crash that plunged the US into the Great Depression.
“That was the greatest crash in modern history. This is going to be on that level – and again, this is once in a lifetime and that is why people don’t see it coming,” he said. ‘I see in the next two, three, even five years a period like the 1930s.”
We might take Dent’s claims with a pinch of salt. In 2014, he claimed that Sydney and Melbourne prices would drop by about a quarter “over the next several years.”
His warning about a Great Depression coincides with another book tour he is currently on in Australia. Coincidence? Maybe it’s just savvy marketing.