I wrote in an earlier article (Preparing for 2015+) about our projected economy and referenced a few websites talking about the financials in our near future.
Allow me to share information on a few charts I obtained this week to demonstrate that we are ‘in’ a downturn cycle economically. Although the (expert) authors have generated their projections based on different but related factors, they have come to the same basic conclusion — we are headed toward an economic downturn.
First, there are four popular economic cycles (all named after their authors):
- Kondratiev’s Wave
- Juglar Cycle
- Kitchin Cycle
- Kuznets Cycle
Kondratiev’s Wave is a ‘super cycle’ based heavily on commodities. That wave (cycle) was originally defined to be a 54-56 year cycle. Although today it is described as a 35-40 year cycle. It is often referred to as the K-wave. This theory defines periods of high economic growth, contraction, recessions, and depressions. We are currently in the fifth K-wave since its inception defined as the 1982-2025 period with the bottom (worst) being in 2025 (earliest projection).
The Juglar cycle was first identified in 1862 by a French doctor and economist. His cycle is defined as a 7-11 year cycle.
The Kitchin cycle is a 40 month cycle related to the inventory cycle of commercial business.
Kuznets cycle is an 18 year swing which shows the rhythms of ‘income inequality’ in American society. I found this one very interesting and was surprised by its conclusion.!? According to Kuznets’ cycle, we are at the low point on his cycle. That means that the inequality between rich and poor is near its smallest point! By 2025 it will be the biggest spread according to his chart. If people are complaining about ‘Wallstreet’ now, imagine 2025?!
Regarding the above cycles, this is the extent of my memory and what I retained on those cycles. I wish I could elaborate more.
In addition to the above economic models, there is a ‘War Cycle’. That cycle is an 8.8-17.7 year cycle with major war cycles (e.g., WWII) of 53.5 years. The last ‘bad’ war cycle dip was in the 1840’s. We are at the bottom (beginning) of the current 53.5 year war cycle. According to this cycle, we should be near its peak by 2020.
Of import, all of these cycles coincide in their timing! They all indicate that we are at the ‘beginning’ of a downturn financially and with regard to war, we are at our safest point. I would have posted some of those charts below for your review, but due to technical issues it was not easy. Suffice it to say, they are classic line charts with their current valleys defined in each at approximately the same time frame.
If asked, my point is that the reader should prepare. Myself, I am doing what I can to prepare for a ‘not too friendly environment‘ and have made sure that my investments are as safe as they can be.
As I’ve said before, “Prepare for the worst and hope for the best”. Er go, I refer to myself as an optopest.
I would be interested in your opinion on this post. Please replace the values in the boxes below with your own and chose the answer that you believe depicts your view.