You Can Prosper in the Age of Decline

“A high probability exists that the decade spanning 2030–2040 will be one of lost opportunities, great economic distress, lost fortunes, deep regrets, and despair over what might have been. Protect yourself: Plan for this future…”

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Since 2014, ITR Economics has been in print warning its clients of the coming Great Depression. Now, eight years later, we are seeing that the trends ITR CEO Brian Beaulieu and ITR President Alan Beaulieu discussed in their book are starting to take shape.

Have you found yourself talking about inflation or labor issues lately?

They were discussing these issues long before you or I started having dinner conversations about them.

However, ITR Economics’ perspective isn’t the doom and gloom one might expect. The firm is adamantly teaching its clients how to prosper in what it has coined “the Age of Decline.”

But before we jump into a few of ITR’s recommendations on what to do now to prepare for the future, let’s address the elephant in the room…

Why should you be confident in ITR Economics’ call for the next Great Depression?

• ITR Economics was founded in 1948 for exactly this purpose.
• ITR Economics accurately forecasted the 2008–2009 Great Recession.
• ITR Economics’ proprietary leading indicator has not missed calling a U.S. recession since its inception in the 1980s.

Need more supporting information for these facts?

Founded in 1948:

ITR Economics was founded in 1948 by a man named Chapin Hoskins, who had lived through the Great Depression. Hoskins observed that “someone should have seen this coming and should have warned businesses so they could plan accordingly.” With that, he began collecting historical data. He identified an underlying cyclicality that could be used to accurately forecast the ebbs and flows of both industries and the businesses that operate within them. From this, he developed what the company still uses today – the ITR Long-Term Business Cycle Theory.

This theory forms the basis for the company’s forecasting, and it is what enables it to be so accurate. ITR Economics proudly posts its forecast accuracy and audits that accuracy every year. The company is not only open about what it can forecast well, but it is also 100% transparent about what it cannot forecast, such as non-economic factors that are simply unpredictable.

2008–2009 Great Recession:

ITR Economics was in print in January 2006, warning readers of its monthly Trends Report of the coming Great Recession. ITR’s forecast accurately called the timing of the Recession, the low point of the Recession, and the rate of rise coming out of the Recession.

Think for a moment – how might you have approached your business strategy differently if you had known, years in advance, the “when,” the “to what extent,” and the “when will it end” for the Great Recession?

How could your business have capitalized on that information? Would you have held off on certain investments? Would you have invested more at other specific times?

Could you have saved money? Could you have made more money?

Here is some testimony from one long-time follower of ITR Economics:

“Not many companies can say that they grew their business during the Great Recession of 2008. We did! Thanks, in no small part, to the strategies and information provided by the terrific people at ITR.”

– HK Bain, CEO of Digitech Systems, LLC

While most economists were talking of the growing economy in 2006, ITR Economics was looking well ahead and doing just what the company initially set out to do – warn businesses of coming downturns so they may coordinate strategies for success even amid future economic turmoil.

Before jumping into our third point, let’s take a moment to talk about 2020…

Now, of course, ITR Economics absolutely did not forecast – and could not have forecasted – COVID-19. That would be a ridiculous claim for us to make. However, we can say that the company stayed on top of the ever-changing trends and was an unbiased leader for its clients amongst the chaos and uncertainty.

One gentleman said:

“I have been following ITR for six years now. By listening to and incorporating the practices of your leadership and excellent forecasting, my company is set to weather this COVID-19 storm while providing our employees with extra PTO and time-and-a-half pay for any hours worked. Thank you for continuing to provide measured and up-to-date forecasts for your audience.”

– M. Lee Williford III of The Wash House Laundromats

The ITR Leading Indicator™:

Finally, before diving into the “what you need to know about the coming Great Depression,” we need to touch on one more item that will help you gain the confidence to act. That is the ITR Leading Indicator™.

In the 1980s, ITR Economics CEO Brian Beaulieu created a proprietary indicator that has an unmatched ability to forecast coming turning points in the overall U.S. economy. Since its creation, the indicator has not missed calling a U.S. recession, and it has never miscalled one, either.

The indicator leads the overall economy by approximately 11 months. This means that when the indicator hits a cyclical peak, ITR Economics knows that we will see a similar peak in the U.S. economy approximately 11 months later.

Folks – this is using ACTUAL DATA. This isn’t using a forecast of a dataset to forecast another dataset. ITR Economics’ team of experts use this powerful indicator during their analysis and as they forecast many sectors within the U.S. economy. It is yet another reason you should have confidence in their abilities to consistently and accurately guide your strategy.

The Great Depression: Two Large Factors and What You Can Do

It’s only going to get worse…

• Inflation, Inflation, Inflation
• A tightening labor market
  

Inflation:

“The industrialized world has not seen systemic inflation since the early 1980s,” reads a section in the aforementioned book. “This means an entire generation has grown up without feeling its effect or knowing how to manage through it.”

Could this be your management staff? Have they seen consumer price inflation at 7% or 10%? If not – they are not prepared. Here are a couple of ways they can prepare:

1. Look at contracts differently. There are a plethora of price indexes that can be useful in negotiating contracts. Using the right producer price index or material price index to develop multiyear contracts will make the difference between profitable and unprofitable business transactions during this time.
   
2. Manage inventory differently. “A just-in-time approach may not be in your best interest as inflation heats up,” says ITR Economics. “Business may also benefit from borrowing and making major purchases in the early stages of a longer-term inflationary cycle, because preinflation purchases provide for lower-cost expenditures. Financing those expenditures means you will be using inflated, easier-to-get dollars to repay the fixed costs. That strategy can return huge dividends as you increase your company’s market position while gaining a financial advantage.”

Tightening Labor Market:

Also discussed in Brian and Alan Beaulieu’s book, as well as in their July 2021 Virtual Keynote, are key demographics to take into consideration in your business strategy.

This pertains to the tightening labor market. Talented teams will continue to be harder to establish and maintain as we move through the 2020s and into the Great Depression. “A tightening labor market means that potential employees will have greater pick over where they want to work and whom they want to follow. Today’s young leaders with technical backgrounds should pursue a master of business administration program or something similar and work diligently on their leadership skills now.”

Do you have a young management staff? Do you plan to have the same people eight years from now? And do they have the right leadership skills for this different business environment?

Preparing your team now will position the business for continued success even through the difficult time ahead.

There are many more factors driving us to the coming Great Depression. Demographic trends, growing government debt, rising healthcare costs, and entitlements are just a few. Such issues create a compounding situation that will ultimately lead us into an economic depression. By taking action now, you will help protect yourself, your business, and your family’s finances.

“It’s really an interesting phenomenon to be a part of,” says Kimberly Clark, Vice President of Sales and Marketing at ITR Economics. “Being a part of the team that is informing the world in order to help businesses and families protect themselves – while also understanding that this is the very reason ITR was founded in the beginning – is truly an honor and a responsibility that I take very seriously. … Brian and Alan take the time to meet with the staff, instructing us personally on how to best prepare. … My hope is that – with every blog, every video – businesses get that same opportunity.”

Position Your Business and Family for Success

As a family-owned, family-run business, ITR Economics maintains a culture dedicated to creating a family-first environment for each and every employee.

That even includes tailoring advice for the upcoming Great Depression to the family level.

How should your children prepare for “the Age of Decline”?

Six Things Your Kids Should Do:

1. Younger people must learn to live below their means and invest in their own future.

2. Learning a second language in addition to English is advisable further along in the more formal education process.

3. Each household, even households of one, should have multiple income streams.

4. Have an income that one of the Great Depression drivers stimulates specifically.

5. Our kids must pay off their entire debt load, or at least as much as possible, by 2030.

6. Be ready to buy.

Where does this leave us?

We want to be clear – ITR Economics is not completely dogmatic about the Depression. It is not saying that 2030 will be the exact year when everything hits the fan. Depending on the data and events leading up to that time, the timing may shift in or out a year or so. That’s why the company stays on top of the data and world events!

Now you can, too. ITR Economics has created a page of information that it keeps updated as new resources become available.

In addition to that, you can sign up to receive the company’s complementary economic updates. These include articles, blogs, one-sheets, and more. All of these will keep you apprised of developing trends, including, but not limited to, those trends driving us toward the next Great Depression.

The future doesn’t have to be scary. Knowing what is to come gives you the ability to protect your wealth in an age of turbulent business cycles. Don’t be caught unaware – start following ITR Economics for more updates as the future unfolds.

Are you ready to start preparing your business for long-term success? Attend our 30th Annual Great Game of Business Conference! Receive insight on the latest issues facing your business, attend sessions on sustainability and strategic planning, and hear from industry experts!