Quote:
Originally posted by Colin@Jul 3 2003, 10:39 AM
How often should one expect a depression magnitude event or a recession?
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Recessions are not as interesting as depressions and I'm sure everyone has their own idea of what makes what.
How often to expect any extreme (cycle analysis) is what I spend most of my time studying (of course, I am usually only concerned with 1-3 weeks at a time). However, it is a good question.
My analysis of historical events and related application of cycles leads me to believe that the easy money years, credit expansion and eventual euphoric peak in equities in 2000 marks the culmination of the expansion from the 16 year distribution (correction) we experienced from the late 60's to early 80's.
I am confident in projecting a correction of atleast this magnitude (after all, we are in the midst of it). There is a reasonable chance that this correction may be 1 degree larger.
I am speaking specifically on equitiy markets, which do not necessarily have a direct correlation to the economy. It is plausible, however, that a severe economic contraction could occur at the same time.
This would have larger implications for debt, currencies and metals. And, as no matter of coincidence, my work on these markets also indicates change on a rather large degree.