Boom, Bust and The Seven Cows
Various friends have written to me regarding the recent financial turbulence and have asked me for my view on what I think will happen. Well, sorry guys, I’m no prophet. No-one can see the future.
Right?
Then Pharaoh said to Joseph, "In my dream I was standing on the bank of the Nile, when out of the river there came up seven cows, fat and sleek, and they grazed among the reeds. After them, seven other cows came up—scrawny and very ugly and lean. I had never seen such ugly cows in all the land of Egypt. The lean, ugly cows ate up the seven fat cows that came up first. But even after they ate them, no one could tell that they had done so; they looked just as ugly as before. Then I woke up."
Then Joseph said to Pharaoh, "The dreams of Pharaoh are one and the same. God has revealed to Pharaoh what he is about to do. The seven good cows are seven years, and the seven good heads of grain are seven years; it is one and the same dream. The seven lean, ugly cows that came up afterward are seven years, and so are the seven worthless heads of grain scorched by the east wind: They are seven years of famine."
Genesis 41 - Pharaoh's Dreams
Previous empirical analyses of U.S. stock index prices show overwhelming evidence of a seven-year wave in the stock market that is part of the overall economic cycle. This cycle is synchronized with the widely known Kondratiev wave that is thought to be fifty to sixty years in duration. The economic cycle runs through four main stages on about a seven year cycle. It goes boom, bust, stagnant, recovery and then repeats ad infinitum.
The economy last hit rock bottom in November 2001. Despite the amazing global economic expansion since then, seven years later (give or take a month or so) here we are again.
According to the economic theorists, this would now put the recovery at around 2015, which by sheer coincidence (?) is what Suze Orman (whom Stephen called the “seer of seers”) predicted in an unguarded moment.
Seven good cows, seven bad.
Who says the Bible can’t predict the future, eh?
Amy
And that’s the last I’m saying about money matters for a while. Many of you will no doubt be relieved to hear it.
(BTW, in case anyone is wondering, no I'm not religious.)
Right?
Then Pharaoh said to Joseph, "In my dream I was standing on the bank of the Nile, when out of the river there came up seven cows, fat and sleek, and they grazed among the reeds. After them, seven other cows came up—scrawny and very ugly and lean. I had never seen such ugly cows in all the land of Egypt. The lean, ugly cows ate up the seven fat cows that came up first. But even after they ate them, no one could tell that they had done so; they looked just as ugly as before. Then I woke up."
Then Joseph said to Pharaoh, "The dreams of Pharaoh are one and the same. God has revealed to Pharaoh what he is about to do. The seven good cows are seven years, and the seven good heads of grain are seven years; it is one and the same dream. The seven lean, ugly cows that came up afterward are seven years, and so are the seven worthless heads of grain scorched by the east wind: They are seven years of famine."
Genesis 41 - Pharaoh's Dreams
Previous empirical analyses of U.S. stock index prices show overwhelming evidence of a seven-year wave in the stock market that is part of the overall economic cycle. This cycle is synchronized with the widely known Kondratiev wave that is thought to be fifty to sixty years in duration. The economic cycle runs through four main stages on about a seven year cycle. It goes boom, bust, stagnant, recovery and then repeats ad infinitum.
The economy last hit rock bottom in November 2001. Despite the amazing global economic expansion since then, seven years later (give or take a month or so) here we are again.
According to the economic theorists, this would now put the recovery at around 2015, which by sheer coincidence (?) is what Suze Orman (whom Stephen called the “seer of seers”) predicted in an unguarded moment.
Seven good cows, seven bad.
Who says the Bible can’t predict the future, eh?
Amy
And that’s the last I’m saying about money matters for a while. Many of you will no doubt be relieved to hear it.
(BTW, in case anyone is wondering, no I'm not religious.)
posted by Lin at 4:49 PM
5 Comments:
Amen, sister.
While you're considering the Bible and the economy, I just posted a pic of me innocently taken by DaveL, edited by an Italian photographer, called "Sarah Palin Relaxes at Home." Yeah, it's nude, and it's at http://sunnycjj.deviantart.com.
Maybe I too could have been an Alaskan beauty queen?
That's the best I can do at the moment. Seven-year cows aside, if the McCain/Palin ticket takes the White House, we're in for a lot of relaxing nude at home. We're gonna lose our shirts. And our cows.
Unfortunately, quotation marks cannot drip sarcasm (e.g., "seer of seers"). The seven year cycle puts the next bust at 2015, with a recovery between now and then. Let's hope.
The theory I talked about maintains that the market cycle follows general wave theory, namely seven years from peak to trough and back again. We have just experienced the seven years of growth (bottom of wave to top), and have reached the top of the wave. The current crash is not the bottom of the wave, it is the start of the downward slope. If UK economists (the bears) are to be believed (highly dubious I agree) then this current crash is not the end, it is the beginning of the end. So the theory points to 7 bad cows until 2015 when the wave starts to rise again.
Or…you could take the opposite view, that economic cycles are not cyclical at all, they merely seem that way on the surface. If indeed they are non-linear dynamic then they instead follow more complex patterns which in turn contain more random or chaotic elements.
Whichever theory you choose, I find the whole thing fascinating to study…until I remember that it’s our money that’s being lost during this giant economic experiment.
Hey, thanks for esplaneing it for me.
With your input. I just adjusted my retirement portfolio. I sold my six mutual fund shares awhile back and had bought four pieces of gold. I had bought them when "they" told me to get out of the market in into gold.
But I sold the gold and I bought seven cows, mine are the fat kind. Thought, I'd kill one a year, at least I'd have steak as the the world fell apart around me. If the world recovers faster, I'll sell any remaining cows and probably make a tidy profit on the up swing.
I had 6, then 4 & now with your help I have 7. Wow, I'm up one and sitting pretty and I thought managing for my retirement was going to be hard and complicated.
Thanks again Lin.
D.L. Wood
I believe you are right, this is the beginning of the end..., we still have the middle and the end of the end to come. Today the stock market fell 508 points and dragged down the rest of the world’s economy with it. It ain’t over till it’s over and I don’t think that will be until well into next year, there’s too much panic. Meanwhile the Wall Street types haven’t learned anything about fairness or moderation but with their Golden Parachutes I don’t think they have any reason to. Just my thoughts. I’d plan on talking about the economy some more, maybe a lot more.
M
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