Blog of lammertdecayfractalshttp://weblog.ecommunics.org/lammertdecayfractals/Sun, 14 Dec 2008 14:19:09 +0100info@ecommunics.orgSun, 14 Dec 2008 14:19:09 +0100http://weblog.ecommunics.org/lammertdecayfractals/archive-2008.html#340 The complex macroeconomy operates by regular patterns akin to those of the hard sciences of physics and chemistry and is exactly represented by ideal timed-based unit, elegantly simple, quantum fractal progressions which compose the macroeconomy's ongoing summation wealth markers - its daily asset classes' valuation saturation curves. This quantum mathematical fractal regularity, this growth and decay patterned predictable behavior of nonstochastic asset valuation saturation and decay is the essence of the exact science that is nonstochastic saturation macroeconomics. This predictive science with asset valuation growth bounded qualitatively by asset overvaluation, asset overproduction, partially nonserviceable accumulated debt, and wages from ongoing jobs to service that debt, can be used to reckon the time frames of asset saturation highs and the time course and fractal progression to saturation asset valuation lows. The absolute values of asset class valuation highs and lows are dependent on the availability of desired assets and degree of preceding and ongoing credit expansion to obtain those assets. This credit expansion is dependent on the variables of lending rates, lending qualification parameters, and the telescoping of credit through fractional (derivative) electronic repackaging of real and virtual credit and the credit derivatives of asset artificial over valuation. Prospectively applying the empirically-derived simple asset valuation quantum fractal laws, a larger primary operating growth and decay valuation saturation fractal pattern has been recently identified which likely represents the time sequence of the US Composite Equity 150-160 year Great Second Fractal's nonlinear collapse, The 11/27/22 month or 46/115/92 week Wilshire fractal growth series starting in October 2002 and ending in the 19 July 2007 high follows the x/2.5x/2x three phase Lammert quantum valuation saturation growth fractal sequence. A reflexive 20/50/40 day fractal took the Wilshire to an exactly predicted interday high on 11 October 2007. In the 2005 above cited reference a predicted extension of the third fractal growth period of 2x to 2-2.5x was made. The Wilshire's 11 October 2007 nominal high fell into the time span of this predicted 22-27 month extension (11/27/22-27months). The Wilshire's final third fractal extension to 2x-2.5x :: 22-27 month valuation saturation area now has pertinance in relationship to a larger identified fractal pattern. It is the nature of fractals that there are interpolated operative fractal patterns within yet larger fractal patterns. The largest operative macroeconomic valuation saturation fractal pattern for the United States' primitive stock exchanges began very proximal to the establishment of its constitution. About 70 years later in 1858, the US Great Second Fractal of time length 2-2.5x began. Nonlinear asset decay within the terminal 2x to 2.5x portion is the hallmark of second fractals and 1998 marked the 2x or 140 year time length - entering the terminal 2x to 2.5xperiod of asset devaluation nonlinearity. This post 1998 entry into the time period of nonlinearity has biased this observer's past asset valuation fractal interpretations. Retrospectively all fractal progression has been consistent with the larger picture of money growth leading to the inevitable ideal asset valuation saturation time frames. The decade or two leading to 1998 and the decade thereafter caused an extension of the 2x: 140 year second fractal length but still within the larger 35 year 2x -2.5x window. The collapse of the Soviet Union, the rise of the Asian manufacturing giants, first Japan and Korea and then China and southeast Asia supplying US retailers with less expensive robotic produced or extremely low labor cost produced items; the rise of the transoceanic transportation industry importing those goods with a correlative surge in transportation related equity valuations; the Eastern symbiotic feedback investment of US dollar profits in US debt instruments allowing continuation of the trade arrangement, the development of the personal computer and its associated software industry, the globalization of US corporations seeking higher profits with outsourcing of expensive US jobs, and the overwhelmingly predominant critical element of the computer based electronic sophisticated manipulations of the unregulated financial and banking industries who telescoped the global money and credit supply into virtual money instruments for the purpose of large front end profits and who were essential in selling US debt instruments to the emerging Eastern manufacturers and maintaining the strange paper for goods arrangement -all of these elements have interacted since 1998 to create two successive asset bubbles created by the available excessive telescoped credit. The PC and Internet equity bubble with froth spillover into other equity classes resembled the Tulip Mania and select undetermined South Sea Instruments credit-available asset saturation bubbles from 360 and 280 years before. This bubble crested in March 2000. The follow-on massive Federal Reserve imprudently low interest rate credit expansion combined with an unregulated financial and banking industries' credit telescoped and sophisticated debt repackaged credit expansion - with unprincipled lending to the most marginal of buyers(debtors) who had no possibility of servicing the debt - created one of the greatest rotating asset valuation saturation bubbles of all time. The real estate, equity, and commodity bubbles crested in 2006, October 2007, and July 2008, respectively. The commodity asset bubble involved the world's waning oil supply which is both finite and limited by producers' capacity to pump it from depleted old fields or convert it from oil sand equivalents. World production capacity did not meet global demand, which was a function of explosive world economic activity expanded by the financial industries' telescoped credit availability and by the financial industry's assisted creation and sales of US debt instruments to the new Eastern manufacturing giants - with enormous front end profits. Within a time span of six months, a rapidly contracting real global economy, created a situation whereby available supply overwhelmed fallen demand with oil declining over 100 US dollars per barrel - a remarkable but expected - second fractal nonlinear collapse of asset valuation. It is better stated that the credit expansion leading to these recent 2000 and 2006-2008 US generational asset class valuation saturation areas began with the 'create work' economic policies and new entitlement programs in the 1930's and even earlier with the debt and credit enabling private banking US Federal Reserve establishment in 1913. The rapid growth of entitlement programs have created forward governmental borrowing which further expands ongoing credit. But it is well recognized by responsible parties inclusive of the former comptroller of the United States that these entitlement programs are fiscally impossible to sustain in the out years. What then is the larger quantum asset saturation fractal pattern for the 140-175 year US Equity asset class Great Second Fractal nonlinear collapse? 1998 marked the beginning of the US composite Great Second Fractal's terminal 2x-2.5x possible interval range. The successive great credit driven asset bubbles have extended the interval but made the inevitable nonlinear ending much more catastrophic for enabled debtors and last musical chair asset owners. For the Wilshire, proxy for the world's equity valuation, starting in October 1998, a growth fractal of 2/5/4 months occurred. A decay fractal of 7/18/17 months thereafter evolved with the initiating 7 months occurring in the saturation area of the 2/4/5 month third fractal 4 month high. In credit cycles asset valuation growth begins in the antecedent decay fractal areas and conversely decay begins in the the antecedent terminal saturation growth areas. A complex 3/7/6 month growth fractal began in last month or two of the 18 month third decay fractal during the time frame of June-July 2002. This 14 month asset valuation fractal is followed by a second 35 month 2.5x growth fractal and a 28 month third growth fractal. A similar monthly fractal pattern exist for the CAC, FTSE, and DAX. For the NIKKEI, a 14/32/28 month Lammert fractal parallels the US and European composite equity valuation saturation pattern. Note that even the NIKKEI falls into the Lammert x/2-2.5x/2x fractal growth pattern. The third fractal 28th month for the Wilshire, CAC, FTSE, DAX, and NIKKEI is September 2008 - the lower high valuation sation area time frame where the Wilshire's incipient nonlinear decline began. The Wilshire's weekly fractal sequence correlative to the incipient 3/7/6 or 14 month base fractal is minimally complicated with a terminal decay weekly fractal series conjoined with an incipient weekly growth fractal series forming the first growth fractal of the 2002-2003 three phase weekly fractal growth sequence. The weekly fractal progression commencing in June 2002 is a decay sequence of 7/17/18 weeks where valuation growth begins in the second weekly decay fractal resulting in a nodal 17 week low - but not an underlying slope line 17 week absolute lower low. The third decay fractal of 18 weeks does end in a slope line lower low in March of 2003. The last 5 weeks of the third 18 week decay fractal becomes the base for the next fractal series of 5/11/12 weeks. The combined decay fractal series and growth fractal series occurred at the interface of a period of ending credit contraction and beginning credit expansion and had a duration of 61 weeks. The second fractal nodal lows occurred at week 150 and 155 with an average of 152.5 weeks consistent with an ideal first fractal base of 60 and 62 with an average of 61 weeks. 120 weeks after the 150 week second fractal nodal low or at 2X of the ideal first 60 week base, the final lower high third fractal saturation area yielded to the incipient area of the nonlinear 1.5-1.6x fourth decay fractal. The time frame of this the Wilshire's third fractal 120 week final lower high valuation saturation area was during the 3rd to 4th week of September 2008 with a non linearity occurring at week 122 or about the second week in October 2008. The monthly and weekly fractal sequences for the Wilshire from June - July 2002 near the end of the internet asset valuation and credit bubble collapse are 14/35/28 months and 61/150-155/120-122 weeks - both conforming rather precisely to a x/2.5x/2x Lammert fractal growth progression. The 1.5-1.6x decay fractal for the completion of the x/2.5x/2x/1.5-1.62x Lammert growth and decay fractal series would ideally last about 21-23 months or 90-98 weeks. Currently as of 13 December 2008, the four phase x/2-2.5x/2x/1.5-1.62x Lammert growth and decay equity asset valuation saturation sequence starting in June -July 2002 is 14/35/28/3-4 of 21-23 months and the weekly pattern is 61/152.5/120-122/10-12 of 90-98 weeks. Reviewing again the Wilshire's 11/27/22-27 month interpolated growth fractal commencing in October 2002, an interesting observation can be made about the 22-27 month extended third fractal containing the new science of saturation macroeconomics predicted 11 October 2007 nominal intraday high. A 6 month or 24 week fractal contains the 11 October 2007 22-27 month third fractal high. This could reasonably be the incipient base for a decay fractal sequence of y/2.5y/2.5y :: 6/12 of 15/15 months or as of 13 December 2008 y/2.5y/2.y :: 24/47 of 60/60 weeks. The terminal area of this interpolated weekly decay fractal in 72 weeks approximates the terminal area of the 61/152.5/120-122/12 of 90-98 week larger four phase Lammert fractal saturation valuation series occurring in 78--86 weeks with possible nodal valuation lows marked both end areas. And interestingly because this is the conclusion of such an enormous 140-175 year US equity second fractal, this fractal sequence may be an interpolated valuation fractal series and part of a 40/77 of 97/100 month larger decay fractal sequence starting in the saturation third fractal 4 month area of a 2/5/4 growth fractal beginning in October 1998 with an incipient base decay fractal of 7/18/17 or 40 months. This decay series would place a nodal low approximately 9 1/2 years. This would roughly parallel gold's expected nodal low with a 7/17/14/10-11 year Four phase Lammert valuation saturation fractal series beginning in 1970. For the smaller interpolated global composite equity fractal series of 14/32-35/20/21-23 months and gold's monthly interpolated valuation saturation series. proxy for the CRB commodities, of 20-21/51/41/2 of 31 months and of 17/35/34/10 of 25 months, a further 80-90 per cent decline of equity and commodity values is possible over the next 16-20 months with long term debt US instruments approaching zero yields.Sun, 07 Dec 2008 19:54:45 +0100http://weblog.ecommunics.org/lammertdecayfractals/archive-2008.html#338 That the complex macroeconomy - defined by asset valuation saturation curves and simple time based fractal progressions- has quantum mathematical properties similar to physics and chemistry as an exact science will likely not be questioned in another decade. Also unquestioned will be the truism that the Economic Fractalist who attempted to advance the concept of macroeconomics as a quantum science did poorly in applying science and in identifying the principle governing fractal pattern involved in the 150 year second fractal US equity nonlinear collapse. The 11/27/22 month or 46/115/92 week Wilshire starting in October 2002 and ending in July 2007 high follows the x/2.5x/2x three phase Lammert saturation growth fractal sequence. A reflexive 20/50/40 day fractal took the Wilshire to the exactly predicted inter day high on 11 October 2007. It is the nature of fractals are that there are interpolated operative patterns within larger patterns. The largest operative macroeconomic fractal pattern for the United States began very proximal to the establishment of its constitution. About 70 years later in 1858, the second fractal of time length 2-2.5x began. Nonlinear asset decay within the terminal 2x to 2.5x portion is the hallmark of second fractals. 1998 marked 2x or 140 years. The decade or two leading to 1998 and the decade thereafter caused an extension of the 2x 140 year second fractal termination (but still within the larger 35 year 2x -2.5x window). The collapse of the Soviet Union, the rise of the Asian manufacturing giants, first Japan and Korea and then China and southeast Asia supplying US retailers with robotic produced or extremely low labor cost produced items; the Eastern symbiotic feedback investment of US dollar profits in US debt instruments allowing continuation of the trade arrangement, the development of the computer and its associated software industry, the globalization of US corporations seeking higher profits with outsourcing of expensive US jobs, and the overwhelmingly predominant critical element of the manipulative 'sophistication' of the financial and banking industries who telescoped the global virtual money and credit supply for large front end profits -all of these elements have interacted since 1998 to create two successive asset bubbles created by the available excessive telescoped credit. The internet equity bubble with froth spillover into other equity classes crested in March 2000. The massive credit telescoped and extended to marginal buyers created one of the greatest rotating asset bubbles of all time. The real estate,equity, and commodity bubbles crested in 2006, October 2007, and July 2008, respectively. The commodity asset bubble involved the world's waning oil supply which is both finite and limited by producers' capacity to pump it from depleted old fields or convert it from oil sand equivalents. World production capacity did not meet global demand, which was a function of world economic activity in turn a function of the expanded credit availability. Within a time span of six months of a rapidly contracting global economy, available supply now overwhelms fallen demand with oil declining over 100 US dollars per barrel - a remarkable but expected nonlinear collapse of asset valuation. 1998 marked the beginning of the second fractal's terminal 2x-2.5x possible interval range. The successive great credit driven asset bubbles have extended the interval but made the inevitable nonlinear ending much more catastrophic for enabled debtors and last musical chair asset owners. For the Wilshire, proxy for the world's equity valuation, starting in October 1998, a growth fractal of 2/5/4 months occurred. A decay fractal of 7/18/17 months thereafter evolved with the initiating 7 months occurring in the saturation area of the 2/4/5 month third fractal 4 month high. In credit cycles asset valuation growth begins in the antecedent decay fractal areas and conversely decay begins in the the antecedent terminal saturation growth areas. A complex 3/7/6 month growth fractal began in last month or two of the 18 month third decay fractal during the time frame of June-July 2002. This 14 month asset valuation fractal is followed by a second 35 month 2.5x growth fractal and a 28 month third growth fractal. The 28th month is October 2008 where the Wilshire's nonlinear decline began.The weekly sequence correlative to the incipient 3/7/6 or 14 month base fractal is minimally complicated with a terminal decay weekly fractal series conjoined with an incipient weekly growth fractal series forming the first growth fractal of the 2002-2003 three phase weekly fractal growth sequence. The weekly fractal progression commencing in June 2002 is a decay sequence of 7/17/18 weeks where valuation growth begins in the second weekly decay fractal resulting in a nodal 17 week low - but not an underlying slope line 17 week absolute lower low. The third decay fractal of 18 weeks does end in a slope line lower low in March of 2003. The last 5 weeks of the third 18 week decay fractal becomes the base for the next fractal series of 5/11/12 weeks. The combined decay fractal series and growth fractal series occurred at the interface of ending credit contraction and beginning credit expansion and had a duration of 61 weeks. The second fractal nodal lows are at 150 and 155 weeks with an average of 153.5 or exactly 2.5x of the 61 week base. 122 weeks after the 150 week nodal low or exactly 2X of the base, the first nonlinear drop of the Wilshire occurred. This was during the 2nd week of October 2008. The monthly and weekly fractal sequences for the Wilshire from June - July 2002 near the end of the internet asset valuation and credit bubble collapse are 14/35/28 months and 61/152.5/122 weeks - both conforming precisely to a x/2.5x/2x Lammert fractal growth progression. The 1.5-1.6x decay fractal for the completion of the x/2.5x/2x/1.5-1.62x Lammert growth and decay fractal series would ideally last about 21-23 months or 91.5- 98.8 weeks. And interestingly because this is the conclusion of such an enormous 140-175 year US equity second fractal, this fractal sequence may be part of a 40/77 of 97/100 month larger decay fractal sequence starting in the saturation third fractal 4 month area of a 2/5/4 growth fractal beginning in October 1998 with an incipient base decay fractal of 7/18/17 or 40 months. In this fractal sequence a further 80-90 per cent decline of equity and commodity values is possible over the next 16-20 months with long term debt US instruments approaching zero yields. Tue, 02 Dec 2008 07:22:40 +0100http://weblog.ecommunics.org/lammertdecayfractals/archive-2008.html#336The real economy is imploding. A combination of asset oversupply, now including oil and gas relative to waning demand, massive and relatively increasing debt load, and the dependent variable of declining jobs are operating in accordance with the quantum laws of saturation macroeconomics. This is an unfortunate causal and necessary positive feedback system which further increases asset oversupply as foreclosed mortgages place additional housing and commercial real estate units on a low demand market and repossessed automobiles appear on full car lots. Paradoxically even as there was a 10 percent valuation gain in the Wilshire over the last five trading days, the long term US bond made a fifty year record low as money market investment money and liquidated equity investment money competed for the transient ‘better investment’ of the US bond. It is the available (and declining) investment money that rotates between possible investment vehicles that creates the asset quantum valuation fractals. The 150 year valuation low for the ten year note occurred in 1941 and 1946 with a valuation of 1.88 per cent. The note yielded 4.40-3.7 from 1930 to 1934 and 3.00 to 2.50 from 1935 to 1939. For the long bond the lows were in 1946 and 1947, 2.55 and 2.43 respectively. The long bond yielded 4.4 to 3.9 percent from 1930 to 1934 and 3.5 to 2.75 from 1935 to 1939. Currently the ten year note yields 2.96 and the long bond 3.49 percent - below its 1930-1935 lows. The long bond and ten year notes appear evolving as 9/11 of 23/18 day growth fractals which will likely take out all of the 1930s’ lows and perhaps the 1940’s two lower low years. This valuation progression will likely correlate to a 12+/24 of 30-31/23-27 low for the great Wilshire, which will likely eclipse in a nonlinear fashion during the terminal portion of the third 23-27 day fractal decay the Wilshire’s recent lows. Gold, proxy for commodities, will likely fall in a 23/26 of 58 day progression to likely significantly below 600 US dollars per ounce. The 23 day base fractal sequence represents the 41st month of a third fractal of a 21-/51/41 monthly gold saturation growth fractal. Available investment money is declining as debts which can be repaid are being repaid and residual asset valuations pay a lower percentage of that collective debt. The asset valuation fractal evolutions are a combination of transient asset saturation curves or spikes and asset devolution saturation curves and spikes. This reciprocal and rotating asset valuation growth saturation and decay saturation is clearly an available investment money phenomena - not a news event phenomena. To understand the real condition of the macroeconomy and its greatest dependent variable, its functional money supply, turn off the news and observe only the reciprocal rotating quantum asset valuation saturation curves. By the use of quantum fractal saturation curves, the current best estimation of a major low for the Wilshire is 29 -37 trading days and thereafter in 27 months, reaching an inflation adjusted low in April-May 2011.Sun, 23 Nov 2008 22:46:50 +0100http://weblog.ecommunics.org/lammertdecayfractals/archive-2008.html#334The Time Based Fractal Solution for the Commodity and Equity Asset Low and for the US Debt Instrument and Dollar High Saturation Valuations The macroeconomic system of total wages, savings, debt, asset valuation, and asset supply is completely mathematical and mechanistic. It produces asset saturation valuation curve data in hourly, weekly, monthly, and yearly units. These data conform to simple fractal patterns which define the complex macroeconomic system as a science just as the simple mathematical laws of gravity describe the relationships of proximal heavily bodies under the influence of unseen but mathematically discernible and consistent fractal energy forces emanating from the mass-energy bodies. Within any given section of the asset valuation saturation curve, fractal patterns at various time orders are identifiable. This is the nature of fractals. But in order to prospectively and accurately determine the true ongoing asset valuation fractal pattern, the complete curve and the longer, intermediate and shorter fractal patterns must be viewed in totality and with relational consistency. Likewise the short term and long term decay and growth fractal relationships of debt valuations, currency valuations, commodity valuations, and equity valuations and their respective inverse growth and decay fractal relationships must be consistent. The world is at the historical time frame for a nonlinear commodity and equity collapse involving the most invested and monied second fractal asset valuation saturation curve in the history of the world - the terminal portion of the150 year US equity valuation second fractal. Saturated real estate market assets and saturated equity assets and saturated commodity assets rotationally peaked within a 2 and 1/2 year period of each other - limited by ongoing debt, overvaluation, and oversupply of durable goods including housing involving basic commodities. Now a collapsing real economy: diminishing jobs, diminishing total wages, collapsing commodity, equity, and real prices is an exponential feed back system causing more oversupply, less demand, and greater debt default. And because the United States has been such a dominant force in the world's - debt driven, US consumer driven, US financial facilitator industry driven, US low interest rate driven -macroeconomy, the entire world has operated under the umbrella of the United States- dominant long range 150 year second fractal pattern - especially for the last 50 years since the second world war. The first 70-71 year asset valuation growth cycle for the United States began coincidentally with the writing of its constitution and ended in 1858 shortly before the American civil war. Nonlinearity between the 2x and 2.5x time frame characterizes the terminal portion of asset valuation second fractals. Asset nonlinear devolution has been transpiring in earnest for the last two months and will now accelerate percentage wise in a precise and predictable nonlinear fractal pattern. This predictable nonlinearity has the potential for dislocating the entire global macroeconomic, debt obligation, political, social, ownership, and currency systems. ---------------------------------------------------------------------------------------------- While the qualitative guidance for the rotational collapse of real estate, equities, and commodities has been accurate, the prospective daily quantitative identification for the daily fractal sequence of the collapse has not been. The prior fractal decay estimations included portions of saturation curve and parts of the various asset elements but not all of the assets within the context of intermediate and longer fractal progression and linked in mechanistic optimal lock step with each other. There is now a fractal solution that fits all parameters: debt instrument growth, commodity and equity collapse, and US dollar growth relative to other basket currencies. This fractal solution provides a time table within which the emanating epiphenomena continuous stream of bad news - collapsing banks, corporations. and retailers; exponentially rising unemployment; unbalance-able state budgets, state budget cuts, tuition increases, defaulting local community bonds, defaulting pension plans, collapsing GDP numbers, and finally decreasing Big Mac sales - will occur. As of 22 November 2008, the inverse fractal daily decay growth pattern is prospectively predicted as 33/14 of 83/25 days.Tue, 11 Nov 2008 12:06:04 +0100http://weblog.ecommunics.org/lammertdecayfractals/archive-2008.html#332 Qualitatively, generational asset valuation saturation areas will always and naturally occur as the collective demand for and collective ability to purchase assets reaches a peak limit, and the economy with an oversupply of assets cannot support the jobs necessary to service ongoing debt. Jobs then decline; the money supply declines; debt undergoes default; supply is transiently increased as defaulted assets are returned to the supply pool; further jobs are lost and asset valuations ultimately decrease to a level that the economy and its wages can support. Appropriate asset inflation controlling interest rates, which are tied to the competing and countervailing debt investment assets, appropriate tax-advantaging of savings, and rational lending parameters targeted to prevent excesses in this natural process - all of these controlling elements are the direct responsibility of the central bank, local banks, appointed security exchange system, and the congress. These boron equivalent control rods have been left unattended, or worse, have been intentional removed by commission of bad monetary policy or intentional laissez-faire nonregulation of the financial industry. The lack of active prudent stewardship by those in an accountable elected position or an appointed position demonstrates a basic gross misunderstanding of how the macroeconomic system works. That asset valuations follow the growth and decay of the money supply and the real economy is in itself trivial. That asset valuations follow predictable time based quantum pathways to likewise specific and predictable high and low saturation points with predictable areas of nonlinear devolution - is nontrivial. This new science of macroeconomic asset valuation quantum fractal analysis shows that the macroeconomic system is a very well defined and very predictable operating entity with bounded limitations of saturation growth and decay. The science contains within it the message that responsible stewardship - of monetary policy including restrictions on money and asset derivatives, of asset tax policy supporting savings and discriminating against asset speculation, and of lending parameters which are based on the ability to repay incurred debt within the context of the predictable bounded economic credit cycle and its expected terminal saturation nonlinear decay areas - are essential to prevent predictable excesses in the macroeconomic system with necessary corrective excessive consequences. Should speculators be allowed to accumulate wealth on the predictable asset valuation rises and declines of tradeable assets that this science now defines or should the government curtail this speculation and create policies that support savings and favor useful investment for useful economic growth that is beneficial to society and to the world? This then is the cited value added of this new quantum macroeconomic science. The time frame for the incipient resolution of the current global financial and macroeconomic crises will only occur when asset valuations come qualitatively into alignment with peak oversupply, peak unemployment, and peak debt repudiation. While further federal debt and bailouts will mitigate the absolute valuation nadir of asset devolution, the quantitative time frame to the nadir of asset saturation decay will not be altered. And the consequences of this additional ongoing massive debt accumulation will be much slower real economic growth after the nadir. At a minimum, the ever expanding mirage entitlement promises that have been made to the global citizenry over the last half century by an ever reelected political body will undergo stark revision proportional to the 150 year nonlinear asset decline and valuation lows and the residual real economy’s ability to pay. A great transformation of a global linearly-thinking citizenry residing in a nonlinear world will occur during this transition period. ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- Two Alternatives For The Optimal Quantum Daily Decay Fractal Pathway --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- One alternative ideal daily fractal decay pathway to the end of a second fractal weekly low: 18-19/46/22 of 46 days :: y/2.5y/2.5y decay with a more likely 18-19/46/22 of 43-44 day decay fractal And 28/66 of 70/70 weeks :: y/2.5y/2.5y decay _____________________________________________________________________________________________________________________ An additional alternative pathway takes the 1929 paradigm of 11/26/27 :: y/2.5y/2.5 y and transforms it into a decaying ideal Lammert fractal of x/2.5x/2x/1.5-1.6x or 11/26/22/18-19 days. The 22nd day of the third growth fractal occurred on 10 November with 18-19 more trading days days to a final major low. This would result in a weekly decay fractal sequence sequence of 27-28/66 of 69'69-70 ::y/2.5y/2.5y weeks. ______________________________________________________________________________________________________________________ Notice that both models and the preceding 11/26/27 day previously cited decay fractal quantum model are all within the window of the x/2.5x/2x/1.5-1.62x weekly fractal series starting in October 2002 of 46/115/92/69-74.6 weeks. The week of 10 November is week 71 of the 69-74.5 week fourth 1.5-1.62x fractal. Sun, 26 Oct 2008 20:34:16 +0100http://weblog.ecommunics.org/lammertdecayfractals/archive-2008.html#329 It now appears that the 2008 Wilshire and its sister established composite equities: the Nikkei, the FTSE, the DAX, and the CAC will follow the 1929 DJIA decay fractal of 11/26/27 days. These global composites have completed the 11th and 10th days of the third 27 day decay fractal. For the 1929 DJIA, there was a 40 percent devaluation from the top to the bottom of the 27 day fractal. The macroeconomic dynamics of 2008 are so much worse than that of 1929 and the expected valuation decline will likely be on a percentage basis greater. The global macroeconomic dynamics of 2008 are extreme and nearly completely imbalanced: massive and colossal collective debt burden, over possession of over valued assets, over supply of over valued assets, persistently over valued assets, a disproportionate amount of questionably value-added and nonessential service jobs, a new Eastern manufacturing giant whose wages benchmark potential manufacturing wages for a depleted American middle class, a thoroughly repudiated anti-value and economically destructive new financial industry with its anti-value financial engineers creating money simply by facilitated and unregulated manipulation of money extension and debt concepts, an entitlement system run amok and divorced from all fiscal reality, a banking system frozen with bad loans and declining asset valuations on its books, bankrupted formerly great smokestack industries whose debt exceeds large sovereign nations and whose stock valuations are at 30-40 year lows - before the decline in the real economy, states, counties, and municipalities with large fiscal deficits and over bloated budgets whose tax bases were grounded in real estate taxes based on mirage real estate valuations, saving less masses living pay check to pay check and new home owners and owners of second mortgages watching their major asset become worth less than their debt obligation, and an extraordinary imbalance of trade with the US requiring 2 billion dollars a day from creditor nations. This is the macroeconomic dysequilibrium disaster that is America and is the world. For the next 16 trading days, there will likely be trading halts that may extend the total number of trading days beyond 16. The next fractal time unit would be hours and the total number of hours could then be divided by about 6.5 to calculate the actual number of trading days. Sun, 26 Oct 2008 11:54:22 +0100http://weblog.ecommunics.org/lammertdecayfractals/archive-2008.html#32726 October 2008: By last week's fractal equity evolution, neither 8/20/20 nor 8/20/16/12 days are the final quantum decay pathways. For the three major speculative investment areas: equities, commodities, and debt instruments, there is a 2 by 3 matrix containing large dedicated pools of investors that have a strong preference for either speculative trading or placing money for long term holding in one particular element. For the inherited wealthy and new creditor nations, large amounts of money is placed long term in interest yielding bonds with periodic rollover reinvestment without concern for improving yields that might be gained by speculating in rotationally growing and decaying equities and commodities and in debt instrument futures. These birthright 'investors' can purchase goods and services without labor or real production or speculative trading based on the amounts of interest gained from very long series of electronic ones and zeros contained in redundant computers. This is the largest pool of wealth in the 2 by 3 matrix and this 'cell' has the most to lose should the entire financial system be repudiated and a new monetary system established. There are likewise the long term holders of equities and gold, a commodity proxy, who accept the daily and long term valuations without exiting their investment vehicle. Finally there are the speculators, the traders in equities, commodities, and debt instrument futures who play with a limited amount of remaining investment money. The investment money found in those three speculative cells is contracting. It is contracting secondary to decreasing money flow into mutual funds as white collar jobs are contracting and as speculative money is now being placed into debt instruments driving down interest rates. As the economy contracts, this process will accelerate with a pool of state employee funds both contracting and following into more conservative debt instruments. As real economy contracts and service and manufacturing jobs are lost, money will be further pulled from equities to maintain basic needs. Commodity prices based on adequate supply and plummeting demand are undergoing devolution and will continue to do so.. All of these devolution occurrences contributed to a contracting money supply. That contracting money supply is exactly reflected hourly, daily, weekly, and monthly by the ongoing and evolving speculative asset quantum valuation decay fractals of equities, commodities and reciprocally by the growth fractals of debt instruments and interestingly, and as has been prospectively predicted, the US dollar as valued against a basket of other foreign currencies. The cell, 1/6th of the 2 by 3 investment matrix. involved in speculative equity trading shows the global similarity of monthly, weekly, and daily fractal decay patterns since the July 07 integrative high. Inspection of the Nikkei, the FTSE, the Wilshire which are well representative of established equity markets show a congruence of monthly, weekly, and daily fractal decay patterns. For all three composite equities the monthly and weekly patterns borrow from the preceding growth cycle and are 7/16 of 16-17/10-17 months and 28/63 of 64-70/44-70 weeks. 6 weeks are combined with 23 weeks to form the 28 week base first decay fractal: the weekly fractal demarcation and grouping is best seen viewing the Nikkei. For all three composites the second 64-70 week decay fractal is composed of two subfractals: a 5/11/10 and a 9/18/15 of 17-21 week decay fractal. The third 15 week subfractal of the 9/18/15 is of interest. It is a composed of a potential15/33/27 of 29-33 day decay fractal. This would result in a 9/18/16 week fractal, which approximates a y/2y/2y decay pattern as seen in the 5/11/10 week and 15/33/29-33 day decay sequences. A 15/33/32-3 day decay series on a daily basis representing the third 16 week fractal of a potential 9/18/16 week series would complete the third 2y fractal of a 39/84/78-79 days:: y/2+y/2y decay series. A more likely final second fractal decay series concluding 28/63 of 64-70/44-70 weekly decay series is found at the beginning of the terminal third daily decay series: 15/33/27 of 29-33 days. If the daily fractal patterns of all three composite equities are reviewed inspecting these 27 of 29-33 days, something fractally interesting can be seen. The Nikkei clearly has a base fractal of 9 days followed by 20 days. The Wilshire's base fractal begins with an up going day which by long standing methodology has been double counted or making the previously identified 8 day base (8/20/20 or 8/20/16/12) in reality a 9 day base. Inspecting the FTSE futures, an underlying slope line identifies a 9 day base. With a 9 day base, the y/2.5y/2.5y congruent decay fractals for all three representative established world equities become 9/20 of 22-24/21-24 days. This fractal decay pattern occurs within the terminal portions of five synchronized second fractals of 150 years, 18 years, 295 weeks, 64 weeks, and potentially 40 weeks and the terminal portion of the 46/115/92/69-74-75 week :: x/2.5x/2x/1.62x ideal growth and decay fractal starting in October 2002. For the Nikkei, FTSE, and Wilshire 64-70 week second fractal decay ending: time will tell: 9/20 of 22-24/21-24 days :: y/2.5y/2.5y. Finally it would fitting for this chronically myopic Economic Fractalist attempting in every way to advance the new science of quantitative saturation macroeconomics to have missed an exact - an exact quantum fractal decay replica of 1929 with all of the previously described qualifications that the macroeconomic dynamics of 2008: massive defaulting debt, asset over valuation, asset over supply, null savings of the masses fostered by bad monetary and governmental taxing policies, global wage dysequilidrium, balance of trade dysequilibrium, necessary US daily global borrowing, et. al. - are all collectively so much impossibly worse than the conditions 1929. From the apogee of the 27 day third decay fractal to its nadir, a valuation decrease of 40 percent occurred in the 1929 DJIA. The decay fractal series in 1929 was 11/26/27 days. An 11 day base can be seen in the final lower high saturation area for the Nikkei, FTSE and Wilshire - with an initiating fractal of 3 days similar to the initiating fractal of 4 days in the DJIA's 1929 devolution. Could the quantum laws of saturation macroeconomics produce a replica of the 11/26/11 of 27 day decay (as of 26 October 08) fractal for the FTSE, Nikkei, and Wilshire identical to 1929.?Sun, 19 Oct 2008 11:39:28 +0100http://weblog.ecommunics.org/lammertdecayfractals/archive-2008.html#325While the global macroeconomy and its principal elements - composed of collective wages and jobs; of cumulative repayable and non repayable, useful and non useful debt based on credit expansion as a function of interest rates and lending parameters and of greed and more recently over the last 30 years of exponentially leveraged asset derivatives and electronic extrapolations of ones and zeros by the real valueless-added new US financial engineers and the financial industry ; of valued assets and quantities of those assets based on over creation, over production and resulting over supply based on ongoing lending and interest rate parameters or based on limited natural quantities or rate limiting production verses global demand; of massive dysequilibrium trade deficits based on the profit motive of new global corporate industries involved in faciltated trade and transportation of goods and on the disparity between eastern production wages and western superpower status - while all of the contributing global macroeconomy’s elements are complex, the summation integrated activity of those ongoing daily results involving those ongoing multi factorial contributions ….. are ….. not complex. This summated macroeconomc activity is reflected in the integrated individual daily valuation points along - its composite and continual heavily exchanged or traded asset equity, commodity, bond, and relative fiat currencies’ - valuation saturation curves. These saturation curves and asset valuations exactly represent the ongoing expanding or contracting money supply. There is an elegant and simple intrinsic order to the macroeconomy and the progression of its asset summation valuation curves. These asset rotational valuation curves define the limits of credit expansion (and decay) to valuation growth and decay saturation areas. Credit expansion results in oversupply. Debt must be repaid. Oversupply results in decreased need for production and the jobs that support that production. The intrinsic order to this self-liimited feed-back complex system s a simple repetitive quantum fractal pattern - on various duration time scale of minutes, hours, days, weeks, months, years - that has been defined in Main Page and the posts of ‘The Economic Fractalst.’ The all time intraday high for the US Wilshire, the world’s most valued equity index, was exactly predicted on 11 October 2007 by saturation curve fractal analysis with the saturation growth portion of the reoccurring fractal growth and decay quantum valuation law of the macroeconomic system: x/2x-2.5x/2x/1.5-1.6x. This quantum fractal pattern exactly describes the commodities’ proxy: gold and gold’s progressive valuation behavior over the last 17/35/34 and 21/53/42 months as well as its longer pattern of 7/17/14-15 years. The scientific goal of this website has been the validation of saturation macroeconomics as a new science: to exactly predict high and low saturation points, the time frame of the expected 150 year second fractal nonlinear devolution, and that devolution's quantum fractal pattern as described in the main page of Economc Fractalist and the websites’ posts. The US equity’s nonlinear 150 year second fractal terminal ending is now occurring. From the October 2002 low, the Wilshire’s fractal progression has been pristine: a x/2x-2.5x/2x/1.5-1.6x quantum evolution of 11/27/22/16 of 16-17 months or 46/115/92/68 of 69-74 weeks. 20 October 2008 starts the 68th week of an expected 69-74 week terminal evolution. (1.5-1.618 times 46 weeks). What then is the terminal daily fractal pattern that will conclude the US 150 year second fractal nonlinearity? The desire for validation of this new quantitative economic science has been the object of this web site’s recent frenetic activity and its multiple recent prognostications. Each trading day provides more fractal pattern data that can be used in the context of the ideal low area: 1.5-1.618 times the October 2002 base fractal of 46 weeks or 69-74 weeks. If saturation macroeconomcs is indeed a real new scientific entity, the progression to the final low valuation should be exactly predictable and occur in an ideal or near ideal quantum fractal decay pattern. On 15 July 08 the concluding fractal sequence began. The first base fractal was composed of 15 days low to low valuation. The second fractal began on 4 August 08 and ended on 18 September and was composed of 33 days low to low. The combined length of the first and second fractals was 47 days. This averaged length of the first and second fractals (a 13-14/34-35 day:: x/2.5x averaged first and second fractal) would reasonably equal the averaged length of the 3rd and 4th fractals of 2x and 1.5-1.6x. The third fractal begins with an 8 day base fractal. A simple decay fractal sequence of y/2.5y/2.5y or 8/20/20 days would place the deterministic end of the US 150 year second fractal nonlinearity between week 69 to 74 of the 46/115/92/69-74 :: x/2.5x/2x/1.5-1.6x: the ideal Lammert fractal sequence beginning in October of 2002. The Wilshire’s final low while mitigated by the trillions of dollars of credit afforded by the world’s banks will likely be unimaginably low and consistent with the facilitated bad debt elaboration and asset overvaluation that has been generated by collective national and world accommodative monetary policy, non inflation controlling interest rates, lack of regulatory activity over the financial industry’s real and shadow investment repackaging and derivative activity , and remarkably imprudent tax rules that promote equity and paper asset speculation, punish savings and fail to adequately reward society real value-added economic activity. As of 20 October 2008 the most likely quantum fractal decay pattern is 8/15 of 20/20 days. An interday low in 5 trading days or on 24 October would support the quantum y/2.5y/2.5y :: 8/20/20 day decay sequence. This would put the ideal final low on 20 November 2008. An alternative fractal decay pattern , still within the 68-74 week (1.618 times the 46 week October 2002 base fractal) window is a x/2.5x/2x/1.5-1.6x or 8/20/16/12-13 day deteriorating Lammert fractal pattern which wound end on 2 or 3 December 2008.Wed, 15 Oct 2008 02:54:47 +0100http://weblog.ecommunics.org/lammertdecayfractals/archive-2008.html#323http://www.economicfractalist.com/blog/Mon, 13 Oct 2008 15:55:23 +0100http://weblog.ecommunics.org/lammertdecayfractals/archive-2008.html#321 Kindly refer to: <a href="http://www.economicfractalist.com/blog/">http://www.economicfractalist.com/blog/</a> for more details. The world's money supply and debt burden are inexorably linked. The fractal patterns of the daily valuations of the global equity markets are hence similar. Underlying slope lines, i.e., bottom trend lines, define fractal progression with the exception of transitional areas between terminal valuation growth and incipient decay and vice versa: terminal valuation decay and incipient growth. This present time area is a solid averaged decay area: incipient averaged growth will not soon occur. A probable daily valuation decay sequence for the world composite equities is 5/10 of12-13/12-13 days. This daily fractal decay sequence is consistent with the larger daily 15/32-33/30-33 day, weekly, monthly, and yearly fractal decay sequences identified in recent posts.