Make us your home page

Great crash ahead? Not so fast, says a cautiously optimistic money manager

Financial adviser vs. financial adviser. Mano a mano.

It's Steve Athanassie, president of Trademark Capital Management in Dunedin, against Harry S. Dent Jr., Tampa-based investment adviser and author of the soon-to-be-released book The Great Crash Ahead: Strategies for a World Turned Upside Down.

Last Sunday, the St. Petersburg Times talked to Dent and co-author Rodney Johnson about their predictions of financial calamity, with the Dow Jones Industrial Average crashing as much as 70 percent, Florida housing prices slumping another 30 to 35 percent, and the specter of 15 percent unemployment.

This week, Athanassie serves up a decidedly more optimistic point of view.

The year ahead will likely be rocky with political angst in Washington not helping matters, he said. But look a couple of years out — right about when Dent envisions a deflationary cycle will take hold — and Athanassie sees the stock markets up moderately, companies hiring and the return of that most elusive element of recovery: consumer confidence.

"Personally, I think in the time frame that (Dent) is saying things will be really horrible, things may actually be better than now," Athanassie said.

Dent's predictions are tethered largely to demographics: The baby boomers who created economic prosperity during their peak spending and investing years in the 1990s will, in retirement, be pulling money out of the economy.

Anthanassie doesn't dispute that boomers play an outsized role in the economy. For one, he said, they'll be working longer, preventing younger workers from moving up and likely making the new "normal" unemployment rate for a healthy economy closer to 7 percent than 4 or 5 percent.

Still, he said, other factors have set the stage for a growing economic recovery.

"Companies have trimmed a lot of fat. They're lean and mean and have tons of cash. After 2008, companies had to get their act together, and I think they have."

Based on price-to-earning comparisons and the multiples that stocks are selling for, many public companies are valued at less than what they're worth, he said, and the markets will eventually catch on.

The question is, when will consumer confidence and business confidence return? Athanassie described these as the missing leg of recovery.

"When you come out of a recession during a normal recovery, all of a sudden you have this mass rush to bring on people." This recession, he added, isn't normal. But he predicts that confidence will return eventually, though probably not until the country fixes its "leadership deficit" in Washington. "And I'm not just talking about the president, but all forms of leadership," he says.

"It's like healing a patient. Time is a factor in healing. As time passes, things will improve. Will that be 2013 or 2014? I don't know, but things will start to improve."

Athanassie cautioned that much of his forecast is based on reasonable expectations. No one knows what catastrophe will hurt our economic future or what new technology or global development will spur it on. Money managers, he said, can deal only with what's happening in the present and put their hope in the future.

"I put myself in the camp of cautious optimists," he said. "I always say, 'Don't bet against America.' "

Great crash ahead? Not so fast, says a cautiously optimistic money manager 09/03/11 [Last modified: Friday, September 2, 2011 8:49pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times


Join the discussion: Click to view comments, add yours

  1. One of the best places for investing in a rental house is in Tampa Bay

    Real Estate

    Two Tampa Bay ZIP Codes are drawing national attention.

    . If you're looking to invest in a house to rent out, few places are better than  ZIP Code 34607 in Hernando County's Spring Hill area, according to ATTOM Data Solutions.
 file photo]

  2. Tampa Chamber of Commerce announces small business winners


    TAMPA — The Greater Tampa Chamber of Commerce selected the winners of the 2017 Small Business of the Year Awards at a ceremony Wednesday night at the David A. Straz, Jr. Center for the Performing Arts. More than 600 attendees celebrated the accomplishments of Tampa Bay's small business community.

    Vincent Cassidy, president and CEO of Majesty Title Services, was named Outstanding Small Business Leader of the Year by the Greater Tampa Chamber of Commerce.

  3. International array of artists chosen as finalists for pier project

    Local Government

    ST. PETERSBURG — A diverse group of six artists will compete for a chance to install their work at the city's multimillion-dollar Pier District, expected to open in early 2019.

  4. Gourmet food fight between top chefs raises $200,000


    ST. PETERSBURG — The chefs came armed with their secret ingredients — pork rinds, truffle butter, pork bellies.

    (From left to right) Chefs Ryan Mitchell, Michael Buttacavoli, Ted Dorsey and Matthew Brennan compete during Tampa Bay Food Fight at The Coliseum in St. Petersburg on Tuesday. The event features chefs from the Tampa Bay area and benefitted Metropolitan Ministries. EVE EDELHEIT   |   Times
  5. HSN star Joy Mangano promotes new book: Inventing Joy


    ST. PETERSBURG — After more than 30 years, Joy Mangano knows a thing or two about promoting products. Now she's promoting herself.

    Inventor and entrepreneur Joy Mangano is releasing her first new book, Inventing Joy on Nov. 7. [TIERRA SMITH | Times]