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The Economic Fractalist
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  • The 16 August 2010 TNX/TYX 16/40/40 day blow-off 0 comments
    Aug 17, 2010 6:00 AM
    The 16 August TNX and TYX  16/40/40 day: x/2.5x/2.5x blow-off

    There is balance even in an unbalanced system.

    Is there doubt that the macroeconomic system even with the massive monetary intervention is not a self organizing nonlinear system?

    After the blow-off depicted by the gap to the downside in TNX and TYX, ideally 15 more days would create the completion of a large first fractal. An inverted 11 day base correlates to this 15 day projection which would have a second fractal of 28 days approximating the 30 day time frame. This correction in the debt market correlates to the 6-7/13-16/12-13/9-10 week equities fractal described in the 8 August  post.

    Unlike the Tulip, South Sea, 1979 silver, 1929 equity, 2000  equity and 2007 equity bubbles; the current equity bubble is supported by an aberrant  monetary system zero short term interest rate policy and the actual systematic  central bank purchase on a massive scale of its own short term debt and bad mortgages.  

    The United States financial condition, balance sheet, and interventions can not be favorably compared with 1929-1939

    Equity valuations are the benefactors of this unprecedented monetary manipulation.
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