There's a reason Case Western Reserve University Weatherhead School of Management professor Dr. Harvey Salkin has been referred to as "Dr. Doom." He provided a grim economic outlook as the guest speaker at a lunch meeting of the Mayfield Area Chamber of Commerce.
Salkin, who had predicted a terrorist attack on the Empire State Building would occur in the 1990s, said another terrorist attack is likely and would further worsen an already tough economy.
"A terrorist attack on this country would be devastating to the economy," he said, predicting a 2,000-point drop in the stock market and even higher levels of unemployment.
Chamber members were surprised and entertained by Salkin, who talked about how government has gotten too big and said the financial system is on the brink of collapse because too much money is being printed.
"Basically they're literally printing cash to pay off debt," he said.
Salkin also works as an investment adviser and provided several tips for personal investing, starting with encouragement to put as much money as possible into individual retirement accounts.
"Max out your retirement plan with whatever you can afford," he said, noting the benefits of tax-deferred investments.
Bonds, however, are not recommended by Salkin.
"Don't buy any long-term bonds," he said. "Anything long-term is going to be worthless."
Instead, he suggested a strategy of buying blue-chip stocks, particularly in drugs or military defense.
"I think that's where the money is," Salkin said. "Buy companies that are not heavily regulated by the government. As soon as the government gets its hands on it, it's over."
He said companies involved in defense are always good investments.
"We've been killing each other since that beginning of time. That's going to continue," Salkin said.
He also suggested an S&P 500 index fund as a good idea for a long-term investment strategy.
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