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  • The Nikkei Futures: Saturation Macroeconomic's x/2.5x/2x Skeletal Structure on a Day Unit Basis: Confirmation of a Patterned Macroeconomic Science. 0 comments
    Jul 24, 2010 8:13 AM
    The Nikkei Futures: Saturation Macroeconomic's Empirical x/2.5x/2x Growth Skeletal Structure With Ideal Elegant Evolution  in a Day Unit Three Phase Fractal Series

    Confirmation of a Patterned Macroeconomic Science.

    The Wilshire's 11 October 2007 nominal high was prospectively predicted by the new science of nonstochastic saturation macroeconomics.

    Nikkei Futures: x/2.5x/2x :: 8/20/15 of 16 days with possible extension to 2x-2.5x of the third fractal

    In the main page of The Economic Fractalist the Macroeconomy's underlying Growth and Decay fractal pattern is defined.

    "The ideal growth fractal time sequence is X, 2.5X, 2X and 1.5-1.6X. The first two cycles include a saturation transitional point and decay process in the terminal portion of the cycles. A sudden nonlinear drop in the last 0.5x time period of the 2.5X is the hallmark of a second cycle and characterizes this most recognizable cycle. After the nonlinear gap drop, the third cycle begins. This means that the second cycle can last anywhere in length from 2x to 2.5x. The third cycle 2X is primarily a growth cycle with a lower saturation point and decay process followed by a higher saturation point. The last 1.5-1.6X cycle is primarily a decay cycle interrupted with a mid area growth period. Near ideal fractal cycles can be seen in the trading valuations of many commodities and individual stocks. Most of the cycles are caricatures of the ideal and conform to Gompertz mathematical type saturation and decay curves. "

    Observe the Daily Nikkei Future's patterns which is a trading day behind the Euro-US equity valuation market.

    8/20/15 of 16 days with a nonlinear drop between day 16 and 17 of the second fractal - exactly defining the nature of a second fractal.

    The15 day third fractal of the 8/20/15 of 15-17 day is composed of a 3/8/6 of 6-8 day x/2.5x/2-2.5x fractal with a nonlinear drop between day 7 and 8 in the 2-2.5x time frame of the third 15 day fractal's 8 day second subfractal (3/8/6 days) sequence.

    Self organization of the Macroeconomy's valuation of assets into growth and decay fractals at various time unit lengths based on the operating money supply is the hypothesis of the new science of saturation macroeconomics.

    This self-organized fractal pattern x/2.5x/2x of asset valuations represents the underlying law or operating nature that defines the boundaried growth and decay of the global macroeconomic system. The macroeconomic system is an exquisitely elegant feedback system.

    Asset valuation growth is based on an expanding 'investible' money supply which is reflexively based on exponentially increasing debt expansion in a forward debt- based economic system system. The simple mechanics of this forward based system is borrow, buy, repay. Credit is borrowed by fractional lending and more recently through Wall Street -London financially engineered 'investment' pools and derivative systems,

    On an elemental economic basis, citizens and landlords borrow to pay builders and real estate developers and repay the banking debt with in the first instance labor and rent revenues. The decade-time unit expanding debt results in inflation of labor wages, rent payments, and increases in the valuations of originally purchased assets.

    All economic systems are ultimately based on debt expansion. All of the system will periodically contract and self correct at temporary saturation areas defined ultimately by over supply or overvaluation which in turn is based on overproduction or competitive but false demand based in turn by the degree of credit expansion.

    Collapses of every asset bubble in history follow this simple scenario. the contraction of asset valuation is directly proportional to the preceding degree of credit/debt growth and total burden, asset over production, and asset over valuation.

    The relative degree of global over supply, over valuation, and indebtedness is unprecedented. The financial engineers are directly responsible for the anomalous distorted extremes of the current saturation area. They have effectively or defacto usurped the money-credit system to expand credit and manipulate electronic money for their gains. Their gains are primarily based on derivatives of tangible wealth; they will gain enormous wealth both in the debt expansion/ asset valuation phases and debt contraction/asset devaluation phases of the system.

    The long term US debt instruments are in a exponential growth phase completing an inverse (TNX/TYX) 25/62 of 63-64 month fractal series following a 16/40/24 of ?32 day fractal. The 24 day third fractal is composed of a 5-/12/9 day fractal with an expected secondary blow-off fractal taking US debt instruments to 150 year low interest rates and completing the nonlinear phase of the 62 month second fractal of the 25/62 month first and second fractal series.

    Note the long term US debt monthly fractal correlation to the Nikkei's 25-26/64 of 64-65 month fractal series which initiates the third monthly decay fractal (y/2.5y/2.5y) starting in 1988 (57 (10/26/23)//128(35/70/20)//(25-26/64 of 64 to 65/2-2.5y or 1.6x-2x/1.5x).

    Great nonlinearity is at the threshold for commodities and equities with the Wilshire completing an ideal 14/35/28/23 of 23 month series ::x/2.5x/2x/1.6x which is a second fractal to 47 month base starting in October 1998 and a qualitatively credit based extension of a 70/140 year US progenitor stock derivative series starting in 1788-1789.
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