Wednesday, May 10, 2017

Cycles and other Tidbits

- The historical cycle is a permanent feature of all historical thought."

- R. G. Collingwood

I believe in the many true aspects that cycles play in our lifetime and throughout history. Harry Dent is onto a great finding in his demographic findings. Strauss and Howe have a great concept in their generation approach to who we are and where we are going. There are many others who have contributed theories like the great Russian economist, Kondratieff. Another of those theories is the Presidential Cycle. It says that a new president in his first term will face an economic slowdown beginning at the end of May. In baseball, there is a saying that records are made to be broken. Will we have a slowdown beginning in a few weeks or will that theory on the presidential cycle be broken this time? The stock market says, "don't worry," as it hits new highs. In fact, here is a strange tidbit on the market that backs up the bulls. On Thursday of last week, there were no puts on the VIX, which is the fear index. Last time that happened was in early 2008 and we all know what happened later that year. Dear reader, there are other signs of what I believe will be a bubble bursting. On that same day, the new trading in the Bit Coin hit a new high of $1500 per coin. To me, this is garbage and no different than fiat currency, but get this. While the Bit Coin was rising, gold was barely able to hold $1200. I know the market can be irrational, but this is insane. In disclosure, being a poor man, my treasure is silver. On that same day, I saw silver continue its decline everyday from the 17th of April. And Platinum? It is barely above $900 and this important commodity is very difficult to extract from the ground.
What the Cycles Say
By the way, the leaders in cycle study divide life into the same relationship as our four seasons. They feel that we are entering WINTER. This is not good because during many winter cycles, war emerges like WWII. However, I hope and pray that not all aspects of cycles are correct, but I do see a bursting bubble in the stock market when phony coins are worth $1500 a piece and real money like gold is worth less. When reality returns to the stock market, people the world over will realize that fiat money is just as phony as the bit coin. Then, they will turn to gold which will bounce high like a Spaulding pink ball that I used as a kid playing stickball.