My favorite chartist

derryb

I wish more chartists included key events.

Good reading as well!

And then there's the interesting 21 month gold peak chart

roadrunner

That 2nd link has some interesting info and charts. Nice! I hadn't remembered that 21 month fib cycle. It would take me an hour to digest Dorsch's currency analysis.
Something better done on a weekend when my head is clearer and receptive.

I wish Nichols published publically more often. Haven't seen much of his stuff the past 1-2 yrs. I think ProofCollection also subscribes to his work.
His use of 86 as a key fractal is the same one Armstrong uses in his 8.6/17.3/25.8 yr economic confidence cycles. Armstrong developed that system 30 yrs ago.
I wonder which of these two had it first? It's hard to reconcile Armstrong's rising economic confidence model into mid-2015 vs. the 120 yr Kress cycle that bottoms
from 2012-2014. They both can't be right. Armstrong's model predicts confidence not necessarily a higher stock market price. They are somewhat different.

jmski52

it's called the "Fiscal Cliff," and it refers to a wicked combination of $500-billion of tax increases and $110-billion of spending cuts that will take effect next year

I always find this interesting. They always increase spending (and taxing) by multiples of what they are willing to cut. Last I heard, it was about equal - but as the political process goes forward, the inevitability of higher taxes increases and spending cuts decreases.

Same old game. It's all about keeping the politicians in their "elected" positions.


the monthly fractal dimension of the gold market, which is a specific measurement of the linearity of a price pattern

Very interesting. I never quite understood that.

It's very valuable information.

When the fractal dimension of a market is high, it is loaded with available energy and ready for a major trend. Right now the fractal dimension of the monthly gold chart is as high as it's been during the entire bull market, meaning there is more energy now embedded within the pattern to power a strong trend than at any other time in the past 13 years. An 80%+ rally is definitely within reasonable expectations for this cycle.

Sinclair is saying $3,500+ I wonder if he's into fractals.

It actually may be time to tiptoe into a little tiny position of GDXJ, but I've been thinking about that a long time already.

Baley

the fractal discussion is very interesting.

So, we can expect the price of gold to double every 21 months, forever?

Very interesting also is the 86.6 year cycle:

Age 0-21 : Child
22-43 : Young Man
44-63 : Old Man
64+ : Old Geezer

which category a person is in (and where they are within it) can (and should) affect their outlook and actions

roadrunner

jmski52, if you do finally tip toe into GDXJ the week after next might be a good time. Suspect we'll see a retest of sorts of this week's bottom or even a lower washout low.
Gold should get hit on the 27th and 28th. Miners may or may not go with it this time around. That may be a safer entry point than next week when volumes are low and
people distracted by the Holiday. How can gold not get hit during it's OE week in 6-8 days?

jmski52

So, we can expect the price of gold to double every 21 months, forever?

Um, ya might want to check with Ben on that question. What are the prospects for a deluge of new money creation every 21 months or so, going forward?

jmski52

Thanks for the tip, Brian. I'll have to make the quintessential decison once again - physical or paper?

I weigh that same question every single time that I have some dough to invest.

Baley

<< <i>So, we can expect the price of gold to double every 21 months, forever?

Um, ya might want to check with Ben on that question. What are the prospects for a deluge of new money creation every 21 months or so, going forward? >>



So, the money supply, or the national debt, or the dollar index, or some other metric has, or is expected to, double every 21 months or so, because that is what has driven and will continue to drive the gold price increases?

It seems the % increase in the gold price, these past 84 months, has far exceeded the % change in any other metric, and may be due to other factors (fear, greed, central bank buying, for example) that may or not continue at the same rate?

Thanks for entertaining my questions, find the subject interesting and trying to learn how to predict the future as well as others

roadrunner

<< <i>

<< <i>So, we can expect the price of gold to double every 21 months, forever?

Um, ya might want to check with Ben on that question. What are the prospects for a deluge of new money creation every 21 months or so, going forward? >>



So, the money supply, or the national debt, or the dollar index, or some other metric has, or is expected to, double every 21 months or so, because that is what has driven and will continue to drive the gold price increases?

It seems the % increase in the gold price, these past 84 months, has far exceeded the % change in any other metric, and may be due to other factors (fear, greed, central bank buying, for example) that may or not continue at the same rate?

Thanks for entertaining my questions, find the subject interesting and trying to learn how to predict the future as well as others >>




The author hasn't suggested that gold's price will double every 21 months, never mind forever.

What he did say was that gold has put in 21 month peaks where it has gained considerably since 2006. What he didn't say was that those 21 month peaks can be traced back
to 2002 as well. That's 10 yrs so far of 21 month cycles. The kicker here is that his monthly fractal chart is at a high level not seen in 3 yrs. Somehow, someway that energy has to
be released. 4 yr cycles abound. It's curious that gold and stocks are going through a semi-repeat of fall 2008 right now. Though back then, there was no infinite QE available. I did
check with Ben and he assured me that he would print to infinity as there was no other alternative to crashing the economy. He knew that in Sept 2008 because without TARP and
$Trillions handed out to big banks, the system would have gone lights out. Kicking the can down the road via unlimited QE is the only alternative to crashing the economy. It's still
gonna implode eventually, but not on Ben's watch. He also told me that he needed tons of WD40 to keep his presses lubricated so I should buy stock in whatever company makes that.

The money supply, national debt, or whatever doesn't have to double every 21 months for gold to put in a 40-90% 21 month run. Gold is playing catchup from all the abuses from
1980-2012. That's 32 years of debt and monetary printing. It takes more than 21 months or even 10 yrs to correct all that. As gold did in the 1970's, it will rise as needed to balance
out the sovereign debts. The cake is already baked. Gold is just playing catch up now. But if we continue to pile on a $1.5 TRILL or more every year, then gold's catching up only
takes longer. Check out the MZM money supply curve at the ST Louis FED (FRED charts....monetary aggregates). It's been growing steadily for years. I personally think comparing
gold's price to just the money supply numbers is antiquated in light of how much credit and derivatives (ie bank "money alternatives") can be created without altering money aggregates.
The banks created a new money system for themselves with otc derivatives. That supply has grown 1000X since 1987. To the banks, it acts like money. And they don't need Congress'
permission to create as much of it as they like. In the first 6 months of 2011 they created $100 TRILL notional. Even using a conservative valuation that comes to $1-$3 TRILL dollars
in alternative money. So if gold rebalances sovereign debts once again, it goes to "X." If we toss in having to rebalance the risks of derivatives, future entitlements, etc. then it's much
larger than "x." When Sinclair made his first estimate of what price was needed to rebalance, it was $1200 back in 2001. Considering all the debt added since then, the new number is
many multiples of $1200.

The last PM bull market lasted between 14-18 yrs depending on whether you look at silver or gold. We're only at year 11. There were 3 distinct waves up in that last bull. This one has
not seen a 3rd wave up yet and possibly not even a completed 2nd wave yet. So I'm not betting against this next 21 month cycle especially considering that gold has already been
consolidating for the typical 7-8 months beforehand. But a contrarian would see that we've had 5 of these cycles. A 6th one in a row seems pretty remote. Therefore, go heavily short
gold since the odds are 6-1 for you. Eventually, the string has to break and you'll be sitting pretty.

derryb

History does't repeat itself but it many times rhymes.

roadrunner

Coincidentally, Sinclair has new international balance sheet liability numbers posted today. From January 1, 2009 to April 2012, the number increased 69% from $3.125 TRILL
to $5.292 TRILL. That's a fast moving target that gold is barely keep ahead of, never mind accounting for the old debt. Gold moved up 91% from $879 to $1679 during that period.
So I guess if they do keep doubling the debt, gold will keep doubling. Basic math.

jmski52

I finished catching up with Sinclair's web page this morning, and by golly - he actually did include some fractal analysis this week! Same guy, I think. As much as I'd rather not get into TA, money flows probably do affect asset pricing around the world, and that probably does run in cycles. I think that Martin Armstrong is some scary dude but he probably has some pretty good insights.

So, the money supply, or the national debt, or the dollar index, or some other metric has, or is expected to, double every 21 months or so, because that is what has driven and will continue to drive the gold price increases?

I agree with roadrunner that gold is playing catch up, but there's a difference between now vs. 1980 or 1990. The economy has continued to morph into a service economy with less and less manufacturing here. I think that is critical, because I think that it makes it that much harder for the economy to recover without a healthy manufacturing sector.

Also, observe the damage to the free market economy that is occuring in food production and fast food franchises. Fewer actual jobs, and now it involves food. I think it's something worth paying very close attention to at this juncture. Every new regulation simply shrinks the margins and raises the prices. I think that these are the harbingers of more inflation, not to mention the loss of more jobs in the economy.

I think we're in trouble, frankly.