Thornton Parker doesn't seem like a doom-and-gloom kind of guy. But his economic forecast could scare the bejabbers out of baby boomers.

Many boomers, Parker points out, have been pouring most of their savings into one basket: the stock market. That, he suggests, could become a problem. "Using stock prices to measure wealth is like counting chickens before they've hatched."

Parker, 70, is creating a stir with his controversial new book, "What If Boomers Can't Retire? How to Build Real Security, Not Phantom Wealth" (Berrett-Koehler Publishers, Inc., 2000).

Parker maintains that much of the nation's economy and many retirement plans are built on "phantom wealth" driven by speculative stock prices, not actual corporate accomplishments.

"There's an enormous flow of money out there that has nothing to do with the production of goods and services," Parker tells an AARP Bulletin reporter. That may not bode well for the future, he cautions.

Parker is waving his red flag after a decade during which millions of investors of all ages put their money and faith in the stock market. Prompted by high returns through much of the '90s, people plowed their resources into stocks to build their nest eggs.

Today, the proportion of stocks in retirement accounts is at an all-time high. Traditional pension plans along with IRAs and 401(k)s now hold, Parker says, at least a third—and perhaps as much as half—of all U.S. equities, up from 10 percent in 1968.

And while many investors and would-be investors are sitting on the sidelines during the current stock-market slump, they could, he believes, come roaring back into the market once stock prices show signs of regaining lost ground.

But people aren't anticipating what may lie ahead, Parker frets. Everyone who's eagerly investing in stocks for retirement, he says, seems focused on the front end of the deal-buying stocks and keeping tabs on their gains.

To avert a potential train wreck, he wants Americans to shift their focus and "look objectively at the back end of the cycle."

What's going to happen, he asks, when the entire baby boom generation—76 million strong—has to liquidate its holdings for retirement income? Who's going to buy all those stocks when there are more sellers than buyers? And at what price?

"There's no historical precedent" for selling such a huge volume of stocks in one fell swoop—or for the looming shift in the ratio of buyers to sellers, he points out. "There has never been a generation that decided to sell maybe half the stocks in the country to use the proceeds for consumption."

"Tip" Parker, as he is known to his friends, explored the implications of those trends during a recent interview. A trim, understated man with a buzz cut, he warms to his subject, his brown eyes dancing behind his glasses as he elucidates his views.

Parker has some 45 years of experience in strategic planning, finance, technology management and policy development, working with the Air Force, General Electric, RCA, the U.S. Office of Management and Budget and the Department of Commerce. While at Commerce in the 1980s, he became convinced that Americans' preoccupation with stock prices had become the Achilles' heel of the nation's investment system.

Contrary to conventional wisdom, Parker claims the stock market's historically good performance is no way to judge its future success. He points to 1981 as a watershed: That was the last year in which stocks paid more in dividends than in gains (the increase in price per share). From 1982 to 2000, stock gains were five times greater than dividends.

Thus, today's investors buy and sell rapidly to capture profits on what they hope will be rising stock prices rather than buying and holding to reap dividends.

All of which leads Parker to fear that boomers, when liquidating their portfolios to pay for their retirement, won't find enough buyers willing to pay such inflated prices. They may be forced to sell at bargain basement prices, he says, thereby severely depressing their retirement income—and perhaps the whole economy.

Not everyone buys Parker's doomsday scenario. Dallas Salisbury, president and CEO of the Employee Benefit Research Institute in Washington, suggests there may well be far more buyers of stock in America's future than Parker thinks.

Salisbury notes that with the increasing prevalence of 401(k)s, more young people are investing than ever before. And workers in their 20s and 30s allocate 80 percent of their portfolios to stocks—a larger percentage than older workers do.

Besides, he says, with people living longer, boomers are likely to keep part of their savings invested in stocks even as they age.

Jeremy Siegel, a finance professor at the University of Pennsylvania's Wharton School, points out that Parker gives short shrift to foreign buyers—especially in developing countries—who may be likely to purchase a bigger share of U.S. equities in the future.

Besides, a thriving U.S. economy could give the younger Generation X plenty of discretionary income to buy boomers' holdings, he says.

So whom should boomers believe—Parker or his critics? And if they do believe Parker, what steps can they take to protect themselves?

Parker says he can't advise people on how to invest their money, though he does recommend clamoring for the financial industry to offer more investment opportunities that yield substantial dividends.

He also encourages individuals to be as self-supporting as they can, to pay off their mortgages and to strive to be debt-free by the time they reach their 60s.

Parker does see a silver lining. "It's not often," he says, "that a country has an opportunity to look ahead, see how a crisis could occur and take preventive steps to keep it from happening. This is one of those times."