Unfortunately, decades after the three economists had their groundbreaking insights, the crucial question remains unanswered: Can policymakers know with any certainty when markets are dangerously out of line, and is there anything they can do about it?

Economists can’t be expected to predict the future. But they should be able to identify threatening trends and to better understand the conditions that can turn a change in prices into a financial tsunami.

Once again, I do not understand why everyone claims that it is so hard to do. The Economy and its bubbles are very easy to see and predict. For example, you could have looked at 2002-2007 period and have easily determined or came to a conclusion that there was a huge real estate and mortgage finance bubble developing. When it would collapse, it would take down the entire economy, multiple financial institutions and our financial markets.

No crazy or complicated economic models needed. This is fairly basic and common sense stuff. Same thing applies to today’s environment. While the majority of the economist do not see any present issue either in the economy or the financial markets, they are there. The majority of economic growth and market recovery over the last couple of years has been driven by an insane amount of credit pumped into our economy by the Fed through a multitude of channels.

Now the economy and the financial markets will have to pay for such a mismanagement by dropping over the next few years (as my timing work indicates). As the Fed perpetuates this cycle of boom and bust by dumping a lot of credit into the economy I remain puzzled why it is so hard to see by most economist and others participating in the financial markets. If you take conflict of interest out of the picture, this becomes very basic.

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Warning: The Markets Can Easily Be Predicted

October 20, 2013October 20, 2013

The Secret To Predicting The Future Of The US Economy

Bloomberg Writes: The Enduring Mystery of Financial Markets

Read The Rest Of The Article Here

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October 14, 2013

The Secret To Predicting The Future

BusinessWeek Writes: The Importance of Tuning Out the Noise

The Dow Jones Industrial Average jumped more than 300 points yesterday on news of talks in Washington to resolve the government shutdown/debt ceiling crisis. Was it a relief rally? A head fake? Will the points disappear if the talks don’t produce results?

Who knows? I don’t. Nor does Wall Street or the finest brain cells and black boxes in Connecticut hedgie-land. Even the most powerful and decorated economists in the country were pretty much blindsided by the Great Subprime Meltdown, a trauma that chopped stocks in half in just months.

So, yes, we’re all pretty much flying blind.

Read The Rest Of The Article Here

Articles such as these anger me. They perpetuate the notion that predicting financial markets is impossible and that no mortal should even attempt to try it. If they do, they are surely to fail. After all, if not even “brilliant” Nobel winning economist can predict the future, what chance do you have?

Actually, a very good one. In fact, it is very hard for me to understand why most people or our “brilliant economist” can’t see the future. I am not by any measure brilliant, yet I could clearly see the 2007-2009 meltdown coming as early as 2005. I have even tried to warn people, yet most wouldn’t listen. Today, it is clear as night and day as well. Not only from the fundamental perspective, but from a cyclical and technical one as well. They all confirm.

Basically, the US Economy and its financial markets are about ready to roll over and go down significantly. No, it will not be an overnight drop, but it is now unavoidable. My work indicates that it will take 2-3 years for the market to hit its lows with lots of up and downs in between. I will present my timing work over the next few months that will illustrate that a little bit better.

My only advice is this. We are not flying blind. Ignore financial media and concentrate on reality and fundamentals. When you do, you will very soon realize exactly where we are in the economic cycle and clearly see what is coming up over the next few years.

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October 2, 2013October 2, 2013

Why The Stock Market Doesn’t Give A Flying F*$# About The Shutdown

After an official US Government Shutdown on Monday night, most Americans braced themselves for a stock market bloodbath on Tuesday. Instead, the market surged higher with the DOW +0.4%, S&P +0.8% and NASDAQ +1.23%.

Why?

As I have told you many times before, the market doesn’t follow the news. It is a leading indicator, not a reactionary one. It could care less because it is a future predicting machine and it is predicting the following things.

The US Government showdown will not last very long and even if it does, it is a non event.
The US will not default on its debt, which is a more significant issue here.

Can it be wrong? Sure and many times it is, but that is not the point here. The point that I am trying to make is that news and events do not have an impact on the overall market. The market is a much more complex discounting and future predicting mechanism that sees weeks, months and sometimes years into the future.

As such, many people have the tendency to label the stock market as random and volatile. It is not. It is simply doing exactly what it is supposed to do. It is predicting the future and in the majority of the cases it is many steps ahead of today’s news cycle.

Now, I know that for many of you it doesn’t make any sense. That is why I invite you to read TIMED VALUE in order to gain further understanding.

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