The principle of relativity, from Newtonian mechanics to Einstein/Lorentz/Poincaré theory of special relativity, has its roots in the basic principle that physical laws should be the same in all inertial reference frames. In other words, there is no such thing as an absolute motion.
Here I want to apply this simple principle of the absence of the […]
Do you have a feeling that something big is happening? I do.
The last year was amazing. Today is exactly a year since the biggest financial crisis in 25 years had started, and we are still posting the GDP growth and there is no recession, at least on TV. The big hairy hand from abroad is […]
The next installment of Kondratyev wave (table of content is here) is about Paul Volcker and the transition from Summer to Autumn.
The next article from the Kondratyev wave cycle (table of contents) is about Summer, the season when the unwelcome inflation develops and the stock market is in a bearish trend.
As the primary Guinea Pig for examining the K-wave is theUnited States I will avoid using the term hyperinflation, as back in 1970s US economy did […]
In this podcast Nariman Behravesh, chief economist at Global Insight Inc. is throwing out some surprising research. The most interesting bullet points are:
Q2′08 GDP in US is +2.5% (who would imagine!)
Q4′08 is negative
Q2′08 GDP in Eurozone is already going negative, by their estimates (wow!)
US headline inflation will reach +6.5% sometimes during this year
US headline inflation […]
I’m just back from vacation and I’d like to publish something lite as a warm up, before I catch up with the news. I would like to make some trivial observations on the junk bond market.
Bernanke had spent June by draining the outstanding credit of Federal Reserve (check WSE for details). Maybe it was to punish hedge funds for oil speculation, maybe to scare investors from stocks to bond. The economy is suffocating from very expensive credit. By moving the yield on “risk-free” (explanation later) credit down the Feds are […]
After the introduction of the seasons of the Kondratyev wave we’ve proved the existence of the extra-long secular cycles that manifest themselves as the periodic swings in the relative debt level, monetary base, and stock market. But the more complicated task is to actually analyze the causation of those cycles.
Drew Matus, economist at Merrill Lynch, is throwing more kaka into our forecasting potion (here is the podcast):
Q2 ‘08 GDP positive, stimulus checks are fading
Q3 ‘09 GDP negative
Inflation remains very elevated all this year, Bernanke is stuck with 2% Fed Funds rate
Finally, inflation is dropping sharply down to 1.6% core rate in Q1 ‘09
Bernanke’s hands […]
The previous two posts on the Kondratiev Wave discussed the debt cycle and monetary base as the basis of the K-wave cycle. The goal of those articles is to show that there is nothing magical in the fact that the economy is experiencing secular cycles with the duration of 50+ years. In fact it’s not […]
The Yellow Brick Road
