Bears are becoming harder to ignore

Peter Schiff and David Tice don't do what they do for the love it gets them.

They are two of the most bearish investment professionals in America. Their outlook for the U.S. economy and stock market is beyond grim.

Schiff, who heads brokerage Euro Pacific Capital in Darien, Conn., sees the dollar and stock market collapsing and the value of American per-capita economic output falling below that of Greece.

Tice, who manages the Prudent Bear mutual fund in Dallas, likewise predicts that U.S. markets will crumble and says the economy could face something akin to the Great Depression.

Of course, forecasts like these aren't the way to make a lot of friends in this country, let alone on Wall Street. Some would call being bearish on America unpatriotic, even treasonous.

And that means many investors long have automatically tuned out the likes of Schiff and Tice. Besides, the doomsayers have been wrong forever, haven't they?

Yet this year, with the debacle in housing and its toxic fallout in markets and in the financial system, the bears' warnings about the future may no longer seem quite so far-fetched. The risks to U.S. prosperity have risen markedly -- even many stock market bulls will admit that much today.

Schiff, 44, and Tice, 53, have no connection except for their outspoken pessimism about where the U.S. is headed.

They share the same basic thesis: America is facing its comeuppance for 25 years of borrowing and spending, saving little and relying increasingly on foreign capital to support its standard of living.

Now, the bursting of the housing market bubble, the surge in mortgage defaults and the plunge in the dollar have exposed what Schiff and Tice believe are serious structural weaknesses in the U.S. economy.

"Our economy is going to be a mess at the end of this," Schiff says. "Our assets are going to get very cheap."

His tactic for preserving his clients' wealth, he says, is to send it all abroad. He hunts for dividend-paying stocks of large foreign companies that are focused on their home markets -- names such as Swiss telecom giant Swisscom and the parent firm of Hong Kong utility China Light & Power Co.

In theory, Schiff's strategy will protect the purchasing power of the money if the dollar follows his script and continues to melt down.

A former Shearson Lehman broker, Schiff went into the business for himself in the mid-1990s in Southern California and moved East in 2004.