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  • NONLINEARITY NOW: Global Equities and US Long Term Sovereign Debt 0 comments
    Jul 31, 2010 9:55 AM

    Global Equities and US Long Term Sovereign Debt at one EXACT  nonlinear break point :nonlinearity slowed by delta valuation trading limits that would occur otherwise in one hour of one day: October 1987 x 10

    The Economic Fractalist
    19 October 06
    A Final Posting

    Saturation Macroeconomics and Saturation Curve Fractal Analysis- A Real Science?

    Fast forward: August 2010:

    The Wilshire: 70/152 years  x/2- 2.5x
                    9/21 year        x/2-2.5x
                    99/240 months  x/2-2.5x  (99 months 9 august 1982 to 11 October 1990)
                    47/97 months  x/2-2.5x
                    14/35/28/23 months x/2.5x/2x/1.6x
                    19/47 week extended x/2.5x fractal by 8/20/21 days

    Corrspondng to the 28/23 months of the 14/35/28/23 month fractal, a final lower high deteriorating maximum saturation growth fractal of:

    35/89/89 weeks.

    The Wilshire has proceeded to its maximum lower high growth limit at


    The Nikkei Futures completed an 8/20/20 day lower high maximum growth fractal.

    The last saturation speculation money has flowed into equities as US long term debt futures began their 16/40/29-30 of 32-40 day blow off.

    Observe the transpiring millennium 25-26/63-65 month second decay for Wilshire/Euro/NiKKEI equities and inverse decay fractal for US debt instruments (TNX and TYX).

    2 year US debt instruments have already reached their 150 year lows; the 5 , 10, and 30 year US instruments will follow within days.

    Expect  predictable terminal second fractal synchronized great nonlinearity of Nonstochastic Saturation Macroeconomics Immediately ahead.

    From: The Economic Fractalist
    19 October 06
    A Final Posting

    Saturation Macroeconomics and Saturation Curve Fractal Analysis- A Real Science?

    November 24 2006  - Day 398 of a 159/398/398 -
    ideal X/2.5X/2.5X Maxium Growth Fractal.....

    Perhaps GM points the way afterall; as GM goes, so goes ....
    November 24, 2006 is day 58 of a 29/73/58 X/2.5X/2X  GM Growth Fractal.

     From AdamSmithhee:August 24, 2005

    Brad and Angelina Love Triangle Shocker

    Brad Pitt, former faithless husband of Jennifer Aniston, may be
    getting a taste of his own medicine.  It used to be that Brad, himself
    a tireless campaigner for development, would cozy up with Angelina
    during breaks on her tours of Africa.  But now she's traveling around
    the continent with a new boy-toy, Jeff Sachs.  Not to be outdone, the
    anti-Sachs Bill Easterly has been appearing on MTV wearing a cool
    black t-shirt, perhaps hoping he'll get picked up by Jessica Simpson,
    "GOP Babe of the Week" and noted aid skeptic.  A surprising number of
    development economists (i.e., more than zero) do turn out to be
    stylish lotharios.  Nonetheless, all the "Elvis of Economics" got to
    travel with was a grizzled Irishman.

    August 24, 2005 in People | Permalink



    I am riding on a limited express, one of the crack trains
    of the nation.
    Hurtling across the prairie into blue haze and dark air
    go fifteen all-steel coaches holding a thousand people.
    (All the coaches shall be scrap and rust and all the men
    and women laughing in the diners and sleepers shall
    pass to ashes.)
    I ask a man in the smoker where he is going and he
    answers: "Omaha."

    Kindly visit the Economic Fractalist economicfractalist .com/

    Posted by: gary lammert | August 24, 2005 at 09:59 AM

    The above comment probably deserves to be nixed as spam, but for those
    who like their nutty theories dressed up in pseudo-scientific
    gobbledygook, the linked site is almost as good as anything by Laffer:
    "This site has been constructed because of the expected inevitability
    of a major sudden phase transition to occur at the conclusion of a
    grand 140 plus-year second fractal cycle starting in 1858. For the
    masses this phase transition will occur both very unexpectedly and
    very suddenly. Approaching the global macro economy from such a causal
    and fractal Weltanschauung may help those considering further debt
    obligation and those in position of formulating future interest rate
    and monetary policy."

    Posted by: Adamsmithee | August 24, 2005 at 11:53 AM

    More nutty-theoried pseudo-scientific gobbledygook......

    From The Economic Fractalist.. 25 August 2005 posting...

    Saturation Curve Fractal Analysis - A Real Science?

    In order to qualify as a true science, the subject entity must be
    testable by scientific method and have underlying laws that operate in
    the real physical environment. These laws must be repetitively
    provable and have reasonable predictability for different
    applications. Scientific testing in college biology, chemistry, and
    physics laboratories usually results in
    experimental values that roughly support the underlying mathematical
    equations and theoretical constructs. If indeed complex economic
    systems travel by the simple quantum laws that observational fractal
    analysis suggests, a similar validity should be testable and provable,
    retrospectively and prospectively, in the great laboratory of readily
    obtainable asset valuation saturation curves.

    Valuation fractals represent a composite integration of primarily six
    elements in the complex economic system: cash and savings; total
    private, corporation and governmental debt load; ongoing wages;
    assets; lending
    practices; and prevailing interest rates. Each of these six broad
    parameters has its own complex internal dynamics and summation
    characteristics. In a very mechanistic fashion, following simple
    near-quantum and near-quantum
    related Fibonacci numbers, valuation fractals 'grow' to buying
    saturation levels and thereafter 'decay' to lower selling saturation
    levels. The fundamental point to this new potential economic science
    is that the daily, weekly, monthly, and yearly valuation fractals
    represent the sum total integration of those six elements and their
    complex interactive relationships. Pour into the economic vat: cash
    for daily transactions, savings available for money to be borrowed at
    given interest rates using
    prevailing lending practices for both major purchases and minor credit
    card purchases, balanced by on-going wages and debt servicing
    obligations, balanced by relative valuation of assets and their
    relative state of consumption, mix it up on a daily, weekly, etc.
    basis - and - from the vat flows forth the daily, weekly, etc.
    summation saturation curves dancing to a
    rather precise near quantum fractal tune. While lower order time unit
    fractals such as minutes and hours represent trading valuation
    saturation points, intermediate fractals represent the larger picture
    of on going velocity of money growth percolating through the system.
    The higher order or 4-yearly, 17-18 yearly and 70 year fractals
    represent both business cycle
    and asset and debt saturation levels at the basic consumer level.

    There are three sequential identified ideal growth fractals followed
    by a decay fractal. The near quantum number time units for the three
    cycles are x, 2-2.5x and 2x, respectively. A nonlinear devaluation
    typically characterizes the second growth fractal somewhere between
    the 2x and 2.5x
    time period. The third growth fractal which ideally is 2x in length
    can have an extension to 2.5x. This extension of the third growth
    fractal has characterized both the current US equity and heavily
    invested commodity areas, particularly oil and gold, for the entire
    128 week duration of the March 2000 secondary growth period.

    Just as the complex system is an integrative process, valuation
    fractals which exactly represent them are likewise composite
    integrations with nonlinear capacitor like decay devaluations.
    Fractals incorporate the terminal portion of the preceding decay
    fractal into the beginning of the
    follow-on growth fractal. An elegant pristine example of this rolling
    integration was the 40/100/100 day cycle exactly x/2.5x/2.5x that
    resulted in the March 2005 top(((an errror of statement -the January 05
    top))) for the DJIA. The first two fractals were 'declining' growth
    fractals with a very characteristic nonlinear break at the end of the
    second fractal in August 2004. That second fractal was likewise
    elegant in its evolution in that it was composed of a 29/72 day x/2.5x
    sub fractal sequence. The probability that these precise sequences are
    random numerical sequential events approaches zero and elevates
    fractal analysis, reciprocally, to a high probability real science
    descriptive of the comple macro economy.

    The subsequent growth fractals dating from August 2004 likewise have
    followed the same very precise fractal growth evolution with a 52/130
    (x/2.5x) day first and second fractal growth sequence with the typical
    nonlinear drop between 2x and 2.5x of the second fractal. Anyone can
    verify this pattern using any of the major US or European indices. The
    fractal US equity sequence has been a 12/30-31/28 day sequence,
    approaching the extended ideal form of x/2.5x/2.5x growth pattern. The
    major European indices ,e.g., the FTSE, DAX, and CAC have a slightly
    different mix of the
    six aforementioned underlying elements and have extended their growth
    - but are still confined within the 52/130/104 theoretical maximum and
    the theoretical Fibonacci maximum of 52/130/(1.62 X 52 = 84-85)days.
    These recurrent numerically ideal patterns since August 2004 once
    again lend substantial credibility to the notion that the complex
    macroeconomy operates according to some relatively precise laws of

    What are the rate limiting factors that result in growth saturation
    points or asymptotes, decay selling saturation points or asymptotes,
    and the general nature of fractal patterning? Each of the six
    controlling parameters- assets, ongoing wages, lending practices,
    prevailing interest rates, debt load, and cash and savings -
    contribute to the saturation areas.
    Some are more important than others in determining cycle lengths and
    saturation points.

    Assets have two important elements: relative valuations and saturation
    ownership. If the valuation becomes too high or too overly consumed,
    demand will decease. The timing for this decrease is exactly
    represented by an asymptotic valuation saturation level or a single
    high valuation point
    followed by lower valuations. The valuation curves provide precise
    'barometric' information on instantaneous demand relative to valuation
    level and relative to the consumption level. Some assets such as gas
    and oil must be purchased to maintain livelihood. As global
    consumption for the this
    finite resource increases, resulting price increases squeeze the null
    saving US consumer, far too many living from paycheck to paycheck, to
    the financial breakpoint. Unnecessarily expensive US healthcare, 25
    percent of the value of which goes to third party insurers and the
    non-value added bill
    collection system, can be considered yet another consumable asset,
    that, like 'uninsured equivalent' gasoline prices, is driving many to

    Ongoing wages and just as important the jobs that support those wages
    are perhaps the most important rate limiting factor in determining
    valuation saturation points. In the US jobs sphere, high paying
    manufacturing jobs with the exception of the housing industry have
    been significantly
    outsourced. As the housing bubble crests, overcapacity will become
    evident and high paying home construction jobs will contract. A
    considerable subset of jobs in America have questionable value-added
    real economic worth and
    will be lightened during consumer retrenchment. It is easy to image
    using the 1930's as a template of a positive feedback contracting
    system, whereby decreased ,e.g., construction jobs leads to decreased
    consumer spending which
    leads to further job contraction in other nonessential service areas
    which leads to further spending contraction and so forth.

    Lending practices and prevailing interesting rates, the latter a
    Federal Reserve controlled parameter, work in synergy to foster money
    creation and asset inflation. Fractional reserve lending practices
    amplify the bank and money market savings used as a reserve base for
    lending. Extremely low interest rates, i.e., a Fed fund rate of 1
    percent coupled with a lending practice of LIBOR type loans, no money
    down and interest only payments
    creates the interesting situation in which the interest cost of money
    is far below the real asset inflation rate. Not to borrow is to lose
    money that would be made with the expected inflation. Conversely,
    saving money under these interest rate and lending practice guidelines
    results in loss of purchasing power. Credit card interest rates
    reflect the needed higher
    interest rates to overcome the default rate. The last year of higher
    Fed Fund interest rates have resulted in both increased mortgage
    payments and decreased bank profitability secondary to the contracting
    spread of long term verses short term interest rates.

    Ongoing debt load and the requirement to service that debt diminishes
    cash available for asset consumption and investment. Percentage wise
    the total debt load relative to wages and GDP has had relatively small
    increases - a fact which has mistakenly reassured many linear thinking
    economists. Debt load becomes very important and a primary factor in
    the fractal decay process, where assets are liquated in an attempt to
    pay down debt. Because debt is in a major way based on the value of
    the asset, debt
    load becomes relatively greater with ongoing declining asset values.
    This process also represent a positive feedback system and is self
    perpetuating. It results in a mechanistic devaluation and deflationary
    process, lowering the value of nearly all non cash or non-cash
    equivalent assets.

    Cash is the money that is represented by greenbacks in circulation and
    greenback equivalent readily convertible debt instruments such as
    treasuries, notes, bonds, bank deposits, and money market funds. In
    short cash represents the dollars in circulation and savings. The
    savings rate,
    which the Federal Reserve has bemoaned to be dangerously low and was
    reported to be zero in July, reflects the competition of the the
    various Investment areas. With interest rates below the real(which
    includes housing) asset inflation rates, deposited money in saving
    instruments loses its purchasing power value each week that it is
    malinvested in the bank or
    interest bearing cash equivalent instruments. Deposited money in
    saving instruments has been generally a bad investment in the last few
    During the decay fractal process, this scenario will be reversed with
    money from ongoing asset liquidation flowing into cash and cash
    equivalents, whose purchase power value will increase relation to
    asset devaluation.

    These are the lumped six broad elements that are dynamically
    interacting with each other to create the summation valuation points,
    curves, and saturation asymptotes. The evolving integrative fractals
    that appear to so well describe the real instantaneous state, the
    trending state, the
    saturation areas, and importantly predict with relative exactness the
    expected nonlinearities of the complex macro economic system, have the
    fundamental characteristics of a real science.

     Gary Lammert economicfractalist .com/

    Posted by: gary lammert | August 27, 2005 at 05:15 AM

    Gary Lammert

    This pages was last modified on 10/19/2006

    The Saturation Peak day

    From the currently available achives of the Huffington Post ....

    Australian Dollar Hits 23-Year High Against US
    Generational US Consumer Saturation Macroeconomics - 11 October 2007: the Top Valuation Day for the Wilshire ?; near the final weekly low for the US dollar?

    Posted 10/10/2007 at 22:23:35

    Watch for an opening day trading gap to the all time high for the Wilshire on 11 October with a closing at the low of the day. While the US dollar will likely be lower against other fiats and gold, it is near its multiweekly nadir.
    posted 10/10/2007 at 22:23:35

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