Cycles: What Goes Up Comes Down

Cycles: What Goes Up Comes Down

Miles Franklin sponsored this article by Gary Christenson. The opinions are his.

From Charles Nenner: “It’s Time to Sell.” (January 28, 2020)

“Market will go down 40%”

“We are totally out of stocks.”

“These bull markets don’t stop on a dime.”

“Small investors are upset if they miss another two or three percent to the upside, while the big investor is afraid they can lose 40% to the downside.”

Breaking News: The DOW fell 2,500 since February 12. The coronavirus has moved to the center ring in our circus of distractions, sidelining the impeachment diversion. Stock markets have broken down over fears regarding coronavirus, reduced trade, transportation, excessive valuations, and declining business activity.

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Note: The Fed will “Inflate or Die,” print trillions of fiat currency units, implement QE4ever and monetize, but liquidity injections cannot fix pandemic related disasters. Stay tuned.

MORE ON CYCLES:

Charles Nenner is a well-respected cycle expert. He thinks:

  1. “It’s time to sell. We are totally out of stocks.”
  2. Interest rates will continue to decline.
  3. “Gold will go to $2,500 per ounce” in the next few years.
  4. “I made the calculation that if the system breaks down and we have to go back to the gold standard, then gold would be around $60,000 per ounce. Who knows what’s going to happen.”

CHARLES NENNER SUMMARY:

Stocks have peaked, interest rates will decline further, and gold will move much higher. How high depends on QE4ever, economic collapse, central bank desperation, the pandemic and economic craziness…

Read: Extreme Prices, Trapped Fed, and Scapegoats

S&P 500 Cycles:

The most important weekly lows in the long-term S&P 500 chart occurred:

  1. October 4, 2002
  2. March 6, 2009
  3. February 12, 2016
  4. December 28, 2018 (out of pattern)

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  • From the 2002 low to the 2009 low was 77 months.
  • From the 2009 low to the 2016 low was 83 months.
  • If this 6.7-year cycle continues, the next S&P low would occur in 2022 – 2023. The S&P could drop a long way in two or three years.

Shorter S&P Cycle Highs:

  1. High occurred week ending Jan. 26, 2018
  2. High occurred week ending Sept. 21, 2018
  3. High occurred week ending May 3, 2019
  4. High occurred week ending Feb. 14, 2020

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  • From Jan. 26, 2018 to Sept. 21, 2018 is 34 weeks.
  • From Sept. 21, 2018 to May 3, 2019 is 32 weeks.
  • From May 3, 2019 to Feb. 14, 2020 is 42 weeks.

The all-time S&P 500 Index closing high (so far) occurred February 12, 2020. That date could stand as the all-time high for years.

The 1966 high in the DOW lasted until 1982 measured in devalued dollars, and longer measured in purchasing power. The 2020 high could survive a month or a decade.

ANNUAL SILVER CYCLES:

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The most important lows in paper silver prices on the COMEX were:

  • November 28, 2014
  • January 01, 2016
  • December 23, 2016
  • July 07, 2017 (does not fit pattern)
  • December 08, 2017
  • November 30, 2018
  • May 17, 2019 (does not fit pattern)
  • December 6, 2019.
  • From November 28, 2014 to January 01, 2016 is 57 weeks.
  • From January 01, 2016 to December 23, 2016 is 51 weeks.
  • From December 23, 2016 to December 08, 2017 is 50 weeks.
  • From December 08, 2017 to November 30, 2018 is 51 weeks.
  • From November 30, 2018 to December 06, 2019 is 53 weeks.

The January 2020 low is a higher low than two earlier lows. Cycles show that silver prices should rally for months, and probably years, based on QE4ever “printing.”

ANNUAL GOLD CYCLES:

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The most important lows in paper gold prices on the COMEX were:

  • November 07, 2014
  • November 27, 2015
  • December 23, 2016
  • December 08, 2017
  • August 17, 2018 (many weeks off the cycle)
  • May 17, 2019 (does not fit pattern)
  • November 08, 2019.
  • From November 07, 2014 to November 27, 2015 is 55 weeks.
  • From November 27, 2015 to December 23, 2016 is 56 weeks.
  • From December 23, 2016 to December 08, 2017 is 50 weeks.
  • From December 08, 2017 to August 17, 2018 is 36 weeks.
  • From August 17, 2018 to November 08, 2019 is 64 weeks.

The December 2019 low is a higher low than two earlier lows. Cycles show that prices should rally for months, and probably years, based on QE4ever “printing.”

From Charles Nenner:

“Gold will go to $2,500 per ounce” in the next few years.”

From Bill Holter: (subscription service)

“The formula is simple if you understand that ALL currency today on the planet is fiat and thus debt based. Any slowdown in general business will mean less cash flow. Less cash flow will directly affect the ability to service debt. Default or even fear of default will create higher interest rates and exacerbate the inability to roll over and refinance. Disarray in credit markets will directly affect the “value” of currency as credit is the foundation.”

From Alasdair Macleod “Estimating the Shape of the Coming Crisis

“We don’t know what will trigger the crisis, but a likely candidate is foreign selling of US dollars combining with a collapse in the US government’s finances. Perhaps the coronavirus will turn out to be a black swan event, but the underlying conditions for an economic and monetary crisis already exist.”

CONCLUSIONS:

  • Coronavirus will disrupt transportation, retail sales, manufacturing, global trade and more. Governments may be embarrassed by their inadequate responses to the pandemic. Expect more civil unrest.
  • Coronavirus could be used as a scapegoat for a global debt reset, the Fed’s failed policies, recession, or a stock market correction.
  • Central bank monetization of Treasury debt, QE4ever, and “repo madness” will not fix a non-financial disaster like a global pandemic. We’ll know in a few months.
  • Cycles, which have limited reliability in Fed liquidity managed markets, indicate a January – February top in the S&P 500 Index.
  • Gold and silver printed lows in December and should rally much higher. QE4ever, monetizing massive government debts, fear, and rotation out of stocks into hard assets will boost prices.
  • We can exert little influence upon the spread of the coronavirus, QE4ever, government statistics and market manipulations. But we should recognize that the “train wreck” of fake money will eventually crash.

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From 1971 to 1980 gold rose by over a factor of 20.

From 2001 to 2011 silver rose by over a factor of 10.

From 2020 to 2030 gold and silver will rise by a factor of ??.

Gold will be the “last man standing.” The coronavirus may accelerate the process.

Miles Franklin will convert fiat dollars into real money—gold and silver bullion. Call 1-800-822-8080 to protect your savings and retirement assets.

Gary Christenson

The Deviant Investor