Eric Janszen, Founder, iTulip.com
|Eric Janszen, author of "The Postcatastrophe Economy: Rebuilding America and Avoiding the Next Bubble"|
|Visionary economic analyst, author, speaker, former CEO and start-up company investor. Frequently interviewed and quoted by CNBC, NPR, WSJ, Barron’s, New York Times and others. The operating principle of his macro-economic forecasts: set aside the ideology and make an effort to understand the dominant underlying processes that drive any era of the political economy and you can forsee its outcome.|
President of iTulip, Inc. and Founder of iTulip.com in 1998, he has an unparalleled long run track record of timely and accurate economic and market forecasts starting with his prediction of a ten year bear market in technology stocks after the technology stock bubble peak in March 2000. He placing the proceeds from stock sales then into Treasury bonds and searched for the next low cost, low risk asset class. In 2001 he diversified 15% into gold at $270 because "it's cheap, and as long as central banks hold gold to hedge the currency risk that their very own policies help create, it's a safe investment."
In August 2002 he warned that the housing bubble would continue for several years, and pose a grave danger to the banking and financial systems and the macro-economy when it finally collapsed. He noted the end of the housing bubble in mid 2006, predicting that “The US will enter a severe recession by the end of 2007” when the market for mortgage securities collapses and private credit markets enter the worse crisis since The Great Depression. In 2007 he told his subscribers that “US stock markets will decline 40% in 2008 in a Debt Deflation Bear Market." He did not expect a repeat of a 1930s deflation, however, even if the credit and banking policy the errors that led up to the 2008 collapse were even more egregious. He explained as early as 2005, the Fed stood by with plans for "radical monetary and fiscal intervention" to prevent the coming private credit market crisis from developing into a runaway deflationary spiral.
But rescue from deflation does not put the world economy on course for a "normal" future. The global economy has fundamentally changed. Private sector bailouts have left governments over-indebted. Heavily subsidized housing markets, from the US to Spain to China, will never be the same.
The United States economy must abandon the boom and bust economic road dominated by the finance, insurance, and real estate industries for a steady course built on neo-industrial foundations with finance serving, not driving, its economy forward. As energy prices rise with the end of the era of cheap oil, America's energy-intense economy, combined with its dependence on energy imports, will put its global competitiveness and preeminence on the line. That crisis, properly managed, may be the key that unlocks the unique potential of the American people, the catastrophe that brings about the nation's ultimate salvation.
Co-Author "America's Bubble Economy" (2006). His new book, "The Post-Catastrophe Economy" (September 2, 2010), explains what’s wrong with the economy and how we can fix it.