These are not new to our ($40/year) Peoplenomics.com subscribers. They’ve had these for a couple of weeks now. But, we’re getting near-enough the “fish or cut bait levels” that it would be rude of us not to post them.
Before reading these, you need to understand this is not trading advice but it IS the result of more than 20-years of research into how markets really work.
One of the points of the research (other than markets are semi-cyclical in nature and therefore semi-predictable) is that when Crashes occur, they do not happen at the top of trend channels. The happen when channel bottoms are being tested.
From a review of the data, we can list a few “Days from Peak to Major Declines” that we might want to keep an eye on:
As you can see, there are a couple of date ranges that should have our undivided attention.
OK…that’s Problem #1.
“There’s a Second Problem???”
Hell yes…isn’t there always? This will take some explaining, but do try to follow along because it’s potentially the most important news item you will ready this month. Really…seriously!
That’s the global market breakdown. If you don’t what Elliott Waves are, the Wikipedia entry on point is here. The original book by R.N. Elliott may be purchased from Amazon ( The Major Works of R. N. Elliott) but more approachable is the Prechter and Frost book ( Elliott Wave Principle: A Key to Market Behavior) which lays out how markets move in wave of 3 or 5, with an occasional 7, and the odd X-waves and such.
All this sounds pretty “esoteric” until you look at our Global Aggregate Index an d discover two very disturbing facts:
1) There is a complete Global five wave advance from the 2009 lows that not only looks complete, but is also breaking down seriously into a Wave 3 down…
How bad can the Global picture get?
VERY, VERY, VERY BAD.
On the Peoplenomics Subscriber Master Index page, there is a small spreadsheet I wrote a good while back called “openbrain.xls” Using it, or the in-house extended version (programmer’s privileged, huh?) we can plug in the size of the first wave down globally and then project where the bottom might be. Having a dart toss on the board, we can then roll in (or in this case OUT) of global stock funds with POSSIBLY better odds than a random walk would provide:
We see (looking up the high of V on the Global Index supporting data – which no, we don’t share) we peg the high at 39,245.01 and the first low (or the A or 1 down that followed) at 35,711.14. When we plug this into the “father” of the brainamp spreadsheet, notice the Wave 5 range we COULD be looking at:
I know what you should be thinking up to this point: “OK, Ure, there’s a chance that the Global Market could drop from where we are this morning down 14 percent or so…but wouldn’t things get better from THERE???”
Sadly, no. Because the Second Problem is THIS:
We know that Elliott Waves “nest” at least until you get out to the decades and centuries level, at that. So here’s the problem:
“What if this is only Wave 1 down or a much LARGER DEGREE Global decline? What does that tell us about the pending crack-up of Globalism?”
Plug the 29,518 number (the fifth wave low in Global 1 down if it works this way as shown above) and the new count infers a near-death-experience for Globalsm. This is how ugly things COULD GET by 2021:
Consider what kind of count MIGHT imply: A whacking of about 80 percent of stock market values globally. Now you know why I was writing Wednesday about the Depression of 2021 on the subscriber side. Not whack-job talk. Just “running some numbers…”
Believe me, since it was a Russian (Nikolai Kondratieff also spelled Kondratiev) that invented the long wave economics angle back in the early 1920’s and before the First Great Depression, no one is likely to have a better bead on this outcome than the Russians. They may be “shaping WW III” already and there’s mounting evidence this is the case.
Why do you think liberals support the mass feminization of America? Decline of the warrior class? Open borders?
There’s War on the horizon…simple as that. When the global order collapses, someone is going to go for the gusto.
Which would explain a lot of the headlines today since it would explain why the Russians might be already engaging in “shaping operations” against both the US and the Europeans Union because if and when the Global Blow Down happens, there will be finger-pointing and the possibility of a global war by 2024.
“What Can Be Done About It?”
Sure, at a personal level you can make the long-term strategic commitment we made when this sort of outcome became inevitable at some point due to the whole world getting off the Gold and Silver standards. And this, in turn, allowed central governments everywhere to just “make up money” out of thin air.
But you see, this causes knock-on effects. For one, the purchasing power of money declines. This looks like “inflation” but in reality, the purchasing power of money is being eroded.
Remember, too, that when there’s a crash, and companies begin to go bankrupt in large numbers, that a Depression doesn’t just wipe out debt because on the other side of the ledger (when you study accounting a bit) you’ll. come to [appreciate that for every bankruptcy there is an EROSION OF SAVINGS.
The only way to play is to have no debt, as we see it. Own from land and the instruments of production even if it’s nothing more than a power rototiller and a few pounds a heritage seeds for vegetables that have lots of nutritional value and not too many pests locally. For us, that’ broccoli.
My Personal Work Plan
I’ve been writing about the economy since 1970 and more or less full-time for the past nearly 20-years. One this is clear: Wise counsel of bright people is always helpful. Please feel free to post outlooks and ideas in our Comments section and pass along this website to your friends. Unlike social media, where there’s a lot of politics and effort to control/harness people’s general distractions, around here the goal is simply to engage in limited politics, but keep a weather-eye out for the major storm clouds.
Unequivocally, today, I am pointing at the sky. A collapse of the Global markets will begin the process of blowing over the Houses of Cards.
It is not certain…that’s juyst the nature of weather forecasting.
Pension funds will be crushed if it does happen, and governments, finding they cannot deal with the bailout costs, will pass them along to their “tax chattel” – us.
This weekend, my friend Robin Landry and I will be spending a few hours going over our views. Robin’s an optimistic realist and thinks there may still be one more major move up before we get to finis. With the global markets breaking down into an obvious third wave down, the odds of a new series of all-time highs seem to me tow be lessening. But, Robin’s been doing this 43-years now…and his view is often golden.
Then, just after Thanksgiving, my consigliere is coming to visit. Anyone smart enough to forecast a global war in the 2024 timeframe back in 1979 (ignoring being a lawyer, CPA, extra-class ham licensee, pilot, etc…) is a useful fellow to bounce things off of as I work out this year’s annual Peoplenomics forecast.
A lot of things to think about this weekend…While Elaine and I will be taking in a show at a casino north of Dallas, it may be one of our last distractions for a while.
Things are likely to be serious even after Thanksgiving as you can see in the “hot dates” listed above.
It may sound trite, but this is a good Friday to say it:
: “God help us all.”
Futures are down 183 as we head to the open. As I read it (again, never advice, mind you) this is a bounce and we should be a higher levels than yesterday sometime next week and ready to break either way after the election returns.
It would have been worse, but GDP just came out and looks pretty good:
On the other hand, as we’ve been ragging this morning, this is not a global answer and that’s where the problems are. Still, best back-to-back quarters in four years.
Democrat Cory Booker may have been the 11th mail “pipebomb” publicity target. I look for him to run for the WH in 2020, btw. I mean, if you’re going to run, got to get a “package” right?
Claire McCaskill’s husband invested in pro-veteran properties that tried to evict homeless vets over $233 owed rent. That ought to help the GOP candidate, huh?
Vladimir Putin invited to Washington in early 2019: John Bolton. Will he be coming to make a “final offer” to play nice?
Social Media’s fall in slow motion continues as Snap shares sink as two million users move on.
Another Historical Replay
Go rewatch the old move “Who Killed Roger Rabbit?”
The plot involves the ripping out of electric street cars in Los Angeles and the press for GM’s diesel buses.
And the replay reciprocal now appears as “GM wants Trump administration to back national electric vehicle program.”
How stupid are we? (Very!)
Moron the ‘morrow… have a great weekend!