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ANOTHER VIEW OF HISTORY'S REGULAR GOLD VS DJIA CYCLES



While searching the web last night I came across Krassimir Petrov's web page "Worse Than the Great Depression (www.financialsense.com/editorials/petrov...; On his page I found a chart of the 200 year ratio of the Dow Jones Average to gold.  Being curious, I drew in my own Night-Cycle approximations on the chart.  Note that the Dow/Gold ratio shows the Dow Jones strong and gold weak at high points on the chart, and Gold, relative to the Dow, strong at low points on the chart.

For those who don't know my view of recent history, I have come to believe that America's economic history moves in definable Days and Night, periods of expansion of credit, activity, amassing of wealth, followed by periods of deflation of debt, inactivity, and 'emptying out'.

These ideas are more fully mapped out in the draft of a book I'm writing "Turn Out the Lights', available for reading at

www.hoalantrangallery.com/Turnoutlights.htm

When I speak of periods of 'inflation', I mean economic bubble inflation, not specifically monetary inflation -- however, the two are often related.  Deflation of the debt bubble speaks for itself.

These period of credit/debt inflation and credit/debt deflation each last for 18 years, the full cycle running for 36 years, Day and Night.

Period A.  2001 – 2019: Night Cycle Deflation, Social Fragmentation, Chaos

Period B.  1983 – 2001: Day Cycle Inflation, Higher forms of Organization

Period C.  1965 – 1983: Night Cycle Deflation, Social Fragmentation, Chaos

Period D.  1947 – 1965: Day Cycle Inflation, higher forms of Organization

Period E.  1929 – 1947: Night Cycle Deflation, Social Fragmentation, Chaos

Period F.  1911 – 1929: Day Cycle Inflation, higher forms of Organization

Period G.  1893 – 1911: Night Cycle Deflation, Social Fragmentation, Chaos

Period H.  1875 – 1893: Day Cycle Inflation, higher forms of Organization

Period I.   1857 – 1875: Night Cycle Deflation, Social Fragmentation, Chaos

Period J.   1839 – 1957: Day Cycle Inflation, higher forms of Organization

Period K.  1821 – 1839: Night Cycle Deflation, Social Fragmentation, Chaos

Period L.  1803 – 1821: Day Cycle Inflation, higher forms of Organization

Period M. 1785 – 1803: Night Cycle Deflation, Social Fragmentation, Chaos
Period N.  1767 – 1785: Day Cycle Inflation, higher forms of Organization


Below you will see how our Night-Cycles usually correspond to a pronounced rally in gold prices and decline in stock prices.  The first full Night-Cycle below, 1821-1839 anticipates the rally of gold, but misses it by a couple years.  The Night-Cycle 1893-1911 also is not convincing -- as gold and stock prices remained pretty flat during this period.

The Night-Cycles 1857-1875, 1929-1947, 1965-1973 seem very much confirmed gold cycle rallies.  Our current Night-Cycle, 2001-2019, seems also to be moving toward a historical moment for gold -- and probably a reverse moment for the Dow Jones Industrial Average.