The Time Frame of the US Equity 140 Year Second Fractal Nonlinearity: Debt's Disastrous Nonlinear End for Non-Dollar Equivalent Assets
The Wilshire: an x/2.5x/2.5x :: 24/60/60 Week Saturated Secondary Peak:
It is the hypothesis of debt dependent quantum growth and decay asset valuation saturation curves and the science of saturation macroeconomics that the time course of saturation curves are unaffected by greater and greater debt. However, the valuations and malinvestments of assets at those saturation points are directly dependent on the excesses of debt.
In 15 weeks the recent zero interest rate policy will be an obvious malinvestment disaster for the small investor enticed to the equity market by low interest rates and will define the moral and real hazard of the Federal Reserve's and its leaderships' lack of understanding of debt dependent Saturation Macroeconomics.
The base decay fractal for the Wilshire was nested in July of 2007 and was a 23-24 week fractal. 61 weeks latter the Wilshire made an interim low. The final 60 weeks is composed of two weekly fractal series: 7/16/19 and 6/12/5 weeks. The 7 and 16 weeks of the first series have lower lows with the last 19 weeks having positive growth. The second 6/12/5 week fractal is composed of 27/55/26 days x/2x/x. The last 16 days of trading has shown a very saturated apical region.
This current time area for the Wilshire may contain the true 140 year debt dependent second fractal nonlinear event. The apical area for the inflation adjusted 2000 valuation high for the Wilshire was nested in a 48 month 2 fractal series composed of a 4/10/8/6 and a 5/11/10 month fractal. This was/is followed by a 19/40-41/41-42 month series, fractal which was deformed by Central Bank interest rate policy. The monthly progression can be better seen in the transportation index whose earlier positive growth resulted from globalization of 1990 US corporation profit motivated NAFTA policies.
A prediction for the Wilshire's low is 24/60/60/15 weeks which is in agreement with the expected commodity low's of 11/27/22/16 weeks.
How far will equities fall over the next 15 weeks? Might the Wilshire fall to 2500?
Could the Federal Reserve intervene in the markets and buy equities to prevent appropriate and natural deflation?
The holders of equities at the recent saturation areas will not be those in Wall Street's financial industry.