Hey - an interesting pattern is still an interesting pattern. Thanks for sharing it.
A really interesting long-term chart that contextualizes this market rally
- Thread starter brettman9
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Hey - an interesting pattern is still an interesting pattern. Thanks for sharing it.
In the same vein, here's one in return...
That's a noble idea as bank lending is contracting at 1% per month.
http://www.telegraph.co.uk/finance/...-prompting-fears-of-double-dip-recession.html
Very nice chart (referring the chart posted by R.C at the bottom of page 2 of this thread).
In fact, there's something there that I find absolutely striking, but it takes a small adjustment. If you slide the red line back about 45 days and align it with the blue line - in other words, if you correlate the Mar 6, 2009 lows with the secondary lows from 1974 (not a stretch, as this was the main low for the dow at the time, and it's almost a double-bottom anyways) - the form of the two rallies match up almost move for move, including the 3-wave correction that each has about mid-way up, which is the only decent sized correction in each case.
The correlation holds right through today, which, in the 1975 version, looks to be basically close to the highs for the first-year rally. If it were to hold true going forward, it would suggest that we would be heading for a very shallow correction and a retest about 5-15 days from now that would be set to fail and kick off a larger-degree correction lasting about 2-3 months, and taking back about a 1/3 of the whole rally. See attached chart.
Obviously nothing to hang your hat on, but interesting nonetheless.
I see these sorts of correlations as more than just coincidence.
Eventually, they break down and go off on their individual paths. But, while they last, it is usually during a time ruled more by emotion than reason, which is, I think, what drives the correlation. People are always people. Regardless of their technology or trappings. Lately, they've been the 1975 and 1938 type of people.
Thanks for posting it.
Good thread guys, thanks for posting and for starting it Brettman. This was particularly brilliant, not that far from what Chamber's vision is for Cisco:
"But, if I had to venture a not-unreasonable guess, it would have something to do with the fact that "good ideas" are now approximately infinitely more potent than they were just 25 years ago in that, no matter where they occur, or when, they are suddenly available to billions of other people for collaboration and integration into their own good ideas, methods, and practices instantly due to the productive overhang of the last secular bull: namely: a global fiber optic information infrastructure. This has got to have some major second- and third-order implications that are yet to be understood or, indeed, fathomable."
"But, if I had to venture a not-unreasonable guess, it would have something to do with the fact that "good ideas" are now approximately infinitely more potent than they were just 25 years ago in that, no matter where they occur, or when, they are suddenly available to billions of other people for collaboration and integration into their own good ideas, methods, and practices instantly due to the productive overhang of the last secular bull: namely: a global fiber optic information infrastructure. This has got to have some major second- and third-order implications that are yet to be understood or, indeed, fathomable."
I agree, extremely insightful. Check out Kurzweil's "The Singularity is Near" for an engaging view into possible future trends and exponential "progress".
http://singularity.com/
Thanks for the link NoDoji, will check it out.
Here is Chamber's talking about his vision of Web 2.0, the technology that can facilitate the powerful innovative synergies that Brettman identified.
http://mitworld.mit.edu/video/619
Here is Chamber's talking about his vision of Web 2.0, the technology that can facilitate the powerful innovative synergies that Brettman identified.
http://mitworld.mit.edu/video/619
I do appreciate this thread, Brettman, but deep and persistent unemployment and contraction of credit may just make historical similarities to '75 irrelevant.
We are still losing jobs that have gone offshore, for the most part permanently, and unemployment could easily reach 11% plus and remain there.
Americans are also saving more now than any time since the 1940s, which is shocking. And bank lending is shrinking at 1% per month.
The U.S. was entering a job expansion and credit expansion period back then, and the reverse seems to be clearly the case today.
We are still losing jobs that have gone offshore, for the most part permanently, and unemployment could easily reach 11% plus and remain there.
Americans are also saving more now than any time since the 1940s, which is shocking. And bank lending is shrinking at 1% per month.
The U.S. was entering a job expansion and credit expansion period back then, and the reverse seems to be clearly the case today.
Agree on 1938, but my recollection of the 1970s is that they had both persistent growth in unemployment as well as credit contraction.
I'm really not trying to be redundant, but back in the 70's, while we had cyclical recessions, we didn't have a massive and permanent structural change to the U.S. economy like we have in the last decade or so. In the 70s, people at factories, tool and die and machine shops, etc., may have been laid off, but they were rehired when things picked back up. Now, their former factories closed down and are for sale, as Chinese and Mexican facilities have replaced them.
Construction booming hid the warts from about 2002 to 2007, as people laid off in other industries got jobs as carpenters, electricians, excavators, plumbers, realtors, mortgage brokers, bank loan officers, etc., but now that this has crashed, the warts and permanent destruction is quite visible.
In the 1930s, there was a light at the end of the tunnel: WWII, where we had more than full employment, as even women were building tanks and fighter planes and bombers, due to the shortage of male labor.
When the men got back after WWII, Japan, Germany, England, Russia, France, Italy - all decimated with factories blown to smithereens - America was the only center of production available, and we built everything, from cars to planes to TVs to washers and dryers and christmas tree lights, for a long, long time.