Originally Posted by The Grey Badger

Excellent! And this makes it extremely plain that (at least so far) Iraq is not a Crisis War.

Thank you! I haven't actually thrown anything into the mixer yet (except for WWII America), and kind of took John's definitions and mixed them in with my own. It still needs a lot of work.

My intention for Iraq is that it would be significant, but would have high politicization and low genocidal violence and thus not make the cut.

Originally Posted by 1990

In Iraq, it seems like a very violent 2T akin to Algeria's Civil War in the 1990s. And for the U.S. it is being fought classically 3T, with high enthusiasm but low patience going in, with no real conclusion in sight, with no obvious options apparent, and with plenty of shrill rhetoric but little real political will to do anything one way or the other. It's sad but true.

Interesting comparison to Algeria. There are some serious differences that aren't worth mentioning, but it's nice from a generational perspective.

Define "genocidal violence" I remember looking through the old stuff and seeing that many posters really weren't satisfied with John X.'s definition.

Originally Posted by Odin

Define "genocidal violence" I remember looking through the old stuff and seeing that many posters really weren't satisfied with John X.'s definition.

Odin, genocidal violence, as I understand it, is another way of saying how energetically the war is pursued. It assumes that the more energetically a war is pursued, the more likely it is to be a crisis. For example, a mass program of ethnic cleansing that is not opposed, and is even supported by the people, is almost certainly part of a crisis. That is the extreme; but going out of your way to target civilians in pursuit of the war would also strongly indicate a crisis. On the opposite end, a passive approach would indicate a mid-cycle period.

Does this answer your question?

Originally Posted by MichaelEaston

Odin, genocidal violence, as I understand it, is another way of saying how energetically the war is pursued. It assumes that the more energetically a war is pursued, the more likely it is to be a crisis. For example, a mass program of ethnic cleansing that is not opposed, and is even supported by the people, is almost certainly part of a crisis. That is the extreme, but going out of your way to target civilians in pursuit of the war would also strongly indicate a crisis. On the opposite end, a passive approach would indicate a mid-cycle period.

Does this answer your question?

Yes, thank you.

Originally Posted by Odin

Yes, thank you.

John, I'll expect that check to arrive sometime next week.

Originally Posted by MichaelEaston

John, I'll expect that check to arrive sometime next week.

Why is he so much more agreeable with you than he is with me?

John

Dear Matt,

Originally Posted by MichaelEaston

> John, are you aware that the most significant single day stock
> market crash occurred 57 years after the Panic of 1857? I haven't
> seen you mention it on your site when talking about the rule of
> 57/58 years, although I could be mistaken. The war clearly played
> a major role, but still...

No, I wasn't aware of that at all, and that's really interesting.

I don't have the daily market data prior to 1928. Do you? If you
do, could you send it to me?

Sincerely,

John

John J. Xenakis
E-mail: john@GenerationalDynamics.com
Web site: http://www.GenerationalDynamics.com

Dear Gaudia,

Originally Posted by GaudiaRay

> Your #3, June 2001.

> Do you know the low for July 10, 2001? The goal in the move was a
> minimum of 1X, down to 10025. The market closed on that day at
> 10175.

> The negative to the event is that it followed closely in time to a
> prior DT. The prior DT was still fresh in the minds of the
> traders. I've already said earlier that DT's that repeat are not
> reliable like the DT seemingly out of the blue.

> It appears that DT trade failed, at first glance. I don't
> understand it. I'm not copping out. I just don't understand it.
> and will return to it later.

Here's all the data:

Code:

Date,Open,High,Low,Close,Volume,Adj Close
2001-07-13,10478.39,10615.42,10374.01,10539.06,1121700000,10539.06
2001-07-12,10269.31,10542.02,10249.58,10478.99,1394000000,10478.99
2001-07-11,10174.70,10355.83,10049.38,10241.02,1384100000,10241.02
2001-07-10,10300.82,10406.87,10104.06,10175.64,1263800000,10175.64
2001-07-09,10253.62,10389.91,10166.55,10299.40,1045700000,10299.40
2001-07-06,10476.73,10483.82,10176.26,10252.68,1056700000,10252.68
2001-07-05,10566.23,10617.47,10403.57,10479.86,934900000,10479.86
2001-07-03,10588.89,10648.00,10479.99,10571.11,622110000,10571.11
2001-07-02,10504.95,10707.24,10397.20,10593.72,1128300000,10593.72
2001-06-29,10565.27,10729.18,10374.32,10502.40,1832360000,10502.40
2001-06-28,10438.73,10736.43,10429.74,10566.21,1327300000,10566.21
2001-06-27,10470.35,10608.48,10351.10,10434.84,1162100000,10434.84
2001-06-26,10497.30,10600.90,10313.40,10472.48,1198900000,10472.48
2001-06-25,10607.88,10711.19,10417.93,10504.22,1050100000,10504.22

Incidentally, all this data comes from

http://finance.yahoo.com/q/hp?s=%5EDJI

If you use the link on the bottom of the page, you can download the
entire dataset (data from 1928 to present) into your spreadsheet for
analysis.

Originally Posted by GaudiaRay

> Not all DT's "work", but those that do are whoppers.

> The current DT is dissipating its energy as time and larger swing
> days release the emotional anxiety.

> The very large attempted reversal in the DJIA, based on its
> interday low of 2+ weeks ago is yet in play and would be the
> failure of the market if it were penetrated by even 100 points
> down.

> When I say "failure", I mean a drop of 2500 points very quickly,
> like 20% of the market value vanishing in a few days.

Well look, if you've discovered something that works 90% of the time,
or even 60% of the time, that would be quite a remarkable discovery.

What exactly is it that you're claiming happens when this "flag"
pattern appears. For example, are you claiming this:

When the "flag" pattern appears, then two months later, the market
will have moved either up 20% or down 20%.

I know that's not what you claimed, but I'm trying to understand what
you ARE claiming.

Sincerely,

John

John J. Xenakis
E-mail: john@GenerationalDynamics.com
Web site: http://www.GenerationalDynamics.com

Originally Posted by John J. Xenakis

Dear Matt,



No, I wasn't aware of that at all, and that's really interesting.

I don't have the daily market data prior to 1928. Do you? If you
do, could you send it to me?

I actually found it on the Black Monday wiki

The Black Monday decline was the second largest one-day percentage decline in stock market history. The largest one occurred on Saturday, December 12, 1914, when the DJIA fell 24.39%. However, in that case, the New York market had been closed since July due to the outbreak of the First World War.

Unfortunately, I have no other data.

[quote=John J. Xenakis;211982]Dear Gaudia,

Well look, if you've discovered something that works 90% of the time,
or even 60% of the time, that would be quite a remarkable discovery.

What exactly is it that you're claiming happens when this "flag"
pattern appears.

Sincerely,

John
---------------------
John, I'm claiming that this pattern results in a high probability price move, within a limited period of time after the pattern occurs.

The amount of the move is between 1X and 5X the first bar of the typically 3 bar and rarely 4 bar sequences of succeeding day higher lows and lower highs.

The sequence is rare, as you can see by what you pulled up from the data.

The best part of this formation is that the investor needs do nothing until there is proof.

The pump fakes so far to the upside, 2 of them on the current Aug 17, 20, 21 move, are a bit unusual. Typically it's one pump fake and then a move through the first bar to test the other side.

As of this moment, this dynamite triangle has lost by virtue of time much of its strength. There is another reversal pattern that controls the trading and it too has an energy punch typically to the failed reversal downside. It has a longer time frame; and it's still in play, but as far as I'm concerned, the dynamite triangle signal has not turned into a tradeable position.

Note. No win, no loss. No trade. That to me is the best position. No risk.
There was no entry point.

If you're interested, look on an hourly chart and you'll see these again also appear infrequently in the S&P and DJIA.

Re: my gold price movement projection, above.

Gold reached 714 today, and settled at 711. My top guesstimate was 711 for the pattern then in existence.

I don't know what happens next. I guess it will consolidate. This 711 is big news and the public is now aware. Little happens when the public knows.

A few days of slashing in each direction is what I expect. It's not tradeable for me as I can't read it.

I've posted some strong words about Bernanke in Calculated Risk, today.
Be aware I think he's incapable of strategizing what to do next, given the reality that's there. The USD is now violated in terms of price. The US hegemony just ended this week, "officially" financially.

Originally Posted by GaudiaRay

Re: my gold price movement projection, above.

Gold reached 714 today, and settled at 711. My top guesstimate was 711 for the pattern then in existence.

I don't know what happens next. I guess it will consolidate. This 711 is big news and the public is now aware. Little happens when the public knows.

A few days of slashing in each direction is what I expect. It's not tradeable for me as I can't read it.

I've posted some strong words about Bernanke in Calculated Risk, today.
Be aware I think he's incapable of strategizing what to do next, given the reality that's there. The USD is now violated in terms of price. The US hegemony just ended this week, "officially" financially.

I'm guessing he will do nothing. There are some at the Fed willing to be Volcker this time around. Look at the inflation numbers in China, the Fed can't inflate with crude@$78.

"Don't panic."
See it yourself. Here's a BBC TV news blurb on Northern Rock's lack of funds.
Of course, they blame the USA and then say something like, "Oops, we got some of that on our clothing too. But all's well in hand as the BofEngland just took care of it."

The Europeans have much, much higher levels of confidence in their governments' ability and intention to good and to rescue the citizenry against ill fortune. That's a big difference between here and there.

So, "don't panic". Got it?!

http://www.ibctoday.com/News/ViewNew...rootRegionId=5

UDPATE....NO NEED TO PANIC.
One day later.
Northern Rock will be sold. Equity holders will get how much less than zero?
It's as John has been saying. The level of anxiety is rising. Fear is now in the UK MSM, with explanations of "how to think about investment risk", with one paper advising to invest only in the UK's biggest banks and S&L's.

Fear is unbridled. So, we can all enjoy the play. It starts with fear and distrust. It starts with confusion.

Panic operates always like this. The crowd gathers. Something is damaged or broken. It spreads like wildfire. Today, we saw the crowds. Monday will see more. Sister banks are about to experience the same. Here, the thing that is broken is "confidence".

Originally Posted by GaudiaRay

"Don't panic."
See it yourself. Here's a BBC TV news blurb on Northern Rock's lack of funds.
Of course, they blame the USA and then say something like, "Oops, we got some of that on our clothing too. But all's well in hand as the BofEngland just took care of it."

The Europeans have much, much higher levels of confidence in their governments' ability and intention to good and to rescue the citizenry against ill fortune. That's a big difference between here and there.

So, "don't panic". Got it?!

http://www.ibctoday.com/News/ViewNew...rootRegionId=5

UDPATE....NO NEED TO PANIC.
One day later.
Northern Rock will be sold. Equity holders will get how much less than zero?
It's as John has been saying. The level of anxiety is rising. Fear is now in the UK MSM, with explanations of "how to think about investment risk", with one paper advising to invest only in the UK's biggest banks and S&L's.

Fear is unbridled. So, we can all enjoy the play. It starts with fear and distrust. It starts with confusion.

Panic operates always like this. The crowd gathers. Something is damaged or broken. It spreads like wildfire. Today, we saw the crowds. Monday will see more. Sister banks are about to experience the same. Here, the thing that is broken is "confidence".

Is this the trigger to start a run on the banks? A paltry 4.7% yield on the 30 year with inflation well over that (dollar decline) should start a rout in the primary market.

There's very good coverage of Northern Trust at Mish's website:
http://globaleconomicanalysis.blogsp...s-to-head.html

In the comments, you'll see excerpts I've posted from comments posted to the BBC's online financial page editor's blog.

The "feel" of the crowd is obvious. The depositors are scared. They feel cheated and unprotected. They will act.

What would be curiously of interest to me is how many are lined up at 4 am or spending the entire night in line in front of the banks. I'll guess high hundreds if not thousands will want to be first in line.

Will it spread to other EU countries and UK banks? We're at the denial and confusion points. Don't expect the rifle to fire and the bullet to come screaming out. Patience. The psychic wounds John talks about have again been inflicted. Monday will scare lots of people when they see it for the 3rd day...fear, and, for those who don't process stress well, panic.

Kewl. Humans are responding the way they're hardwired to do so.

Going out on a limb, I'm gonna guess the US DJIA will join the international party and begin another, and final, spectacular rise.

I know I can get my head handed to me. I yet favor as the safe position only gold and stand by that. However, the market has failed to break; the international markets have failed to break; and the chart is so tightly wound, like a tiger ready to dash for freedom the moment the cage is opened, I'm expecting an absurd 4%+ rise in the DJIA within the next week, and as much as 10% total over the next few weeks following.

The bad news is out. It's done no damage to the markets. They're where they were 3+ weeks ago. The unexpected will be a dramatic rise.

Of course it's all "false", but a rise is a rise.

Gold is the tell, however. It's continuing its rise right through the prior top. The market movement is assertive and in small steps. This is like a charge down the football field, passes and runs, unstoppable by the other side. Finally, it will make headlines, and dash. It's an assessment of how much is left to go at that time. As I see it, $800 gold within 2 weeks, first week in October. That will be a 20% return in 2 months...650 to 800.

Or, more ugly, a 20% decline in fiat in 2 months. It's outrageous. The CB's can paper over whatever they want. The game is playing out, and gold's posting the score. I think the thing to do is hedge future income against gold price now by buying gold calls and selling puts well below the market.

Originally Posted by GaudiaRay

Going out on a limb, I'm gonna guess the US DJIA will join the international party and begin another, and final, spectacular rise.

I know I can get my head handed to me. I yet favor as the safe position only gold and stand by that. However, the market has failed to break; the international markets have failed to break; and the chart is so tightly wound, like a tiger ready to dash for freedom the moment the cage is opened, I'm expecting an absurd 4%+ rise in the DJIA within the next week, and as much as 10% total over the next few weeks following.

The bad news is out. It's done no damage to the markets. They're where they were 3+ weeks ago. The unexpected will be a dramatic rise.

Of course it's all "false", but a rise is a rise.

Gold is the tell, however. It's continuing its rise right through the prior top. The market movement is assertive and in small steps. This is like a charge down the football field, passes and runs, unstoppable by the other side. Finally, it will make headlines, and dash. It's an assessment of how much is left to go at that time. As I see it, $800 gold within 2 weeks, first week in October. That will be a 20% return in 2 months...650 to 800.

Or, more ugly, a 20% decline in fiat in 2 months. It's outrageous. The CB's can paper over whatever they want. The game is playing out, and gold's posting the score. I think the thing to do is hedge future income against gold price now by buying gold calls and selling puts well below the market.

Good call, it will be interesting to see where long rates end up with inflation taking off. That should put a crimp in the stock market rally.

Originally Posted by GaudiaRay

Going out on a limb, I'm gonna guess the US DJIA will join the international party and begin another, and final, spectacular rise.

I know I can get my head handed to me. I yet favor as the safe position only gold and stand by that. However, the market has failed to break; the international markets have failed to break; and the chart is so tightly wound, like a tiger ready to dash for freedom the moment the cage is opened, I'm expecting an absurd 4%+ rise in the DJIA within the next week, and as much as 10% total over the next few weeks following.

The bad news is out. It's done no damage to the markets. They're where they were 3+ weeks ago. The unexpected will be a dramatic rise.

Of course it's all "false", but a rise is a rise.

Gold is the tell, however. It's continuing its rise right through the prior top. The market movement is assertive and in small steps. This is like a charge down the football field, passes and runs, unstoppable by the other side. Finally, it will make headlines, and dash. It's an assessment of how much is left to go at that time. As I see it, $800 gold within 2 weeks, first week in October. That will be a 20% return in 2 months...650 to 800.

Or, more ugly, a 20% decline in fiat in 2 months. It's outrageous. The CB's can paper over whatever they want. The game is playing out, and gold's posting the score. I think the thing to do is hedge future income against gold price now by buying gold calls and selling puts well below the market.

The Dow has already gone up more than 300 points according to CNN over an hour ago.

There are times when I "know" what will happen. I'm pretty conservative nowadays compared to my desire in the past to know what the S&P would do every hour or so; it was a horrific life to be a trader for my own account. I had no life. Now, I can see when I can see, and not get overly anxious.

Gold in the aftermarket is at 725, spot. I only look at spot. We will see 800, or at least 796.90. That last rush to 800 will be very quick or won't happen; it's a "cheat" for those who are sure of the obvious target not to get there. Always in a trade exit before the target fully half the position. It won't pause to do much about the prior high other than tell the losers to get lost.

As to the DJIA, based on the dynamite triangle and the reversal I see, I would not expect more than 14050 first and 14400 as the top, and 14200 on the reversal. I'll reconsider as the numbers get closer to their target numbers.

It's all malarky. The CB's have now said, in unison, to heck with saved capital; let's sustain business and employment and let's do that at the cost of store of value of our citizens. It has been the constant behavior of governments from time immorial. And the other obvious conclusion by the CB's is to attempt to save the majority of homeowner's wealth via inflation. Many will lose their homes, but those who have low debt will stay in them and prosper due to inflation.

In the case of failed mortgages, and distress sales, I'm not sure we will see a collapse in prices, although I do think that's what should happen. We have CB's who do not mete out punishment. I'm unclear what will happen in this area. But I'm watching as I want a basketload of RE when the bottom is in, to buy up and rent as a landlord to the poor, but in better neighborhoods because poor will be poor. I do think that lower interest rates accomplishes nothing, but for the moment, the fun game is to deny truth, and that's what's being played out. One more pretend quickstep around the chairs in the middle before the music stops.

Your smiling reporter,
PPT (destroyers of the stores of wealth, once again, to those oldsters who are not "looking" at what's happening, and whose banishment would be the kindest act for that den of thieves...they did it once to my father by stealing his youth via the Great Depression and they did it again to my parents...Reagan et al, and they'll never ever do it to me; I've hooked in multiple ways to take the ride so what I save is my empowerment, not theirs to steal via inflation.)

2 days later, early morning in the USA.. imo, gold will hit the 800 number leaving all who are not honest aghast, with gold at 730 spot in London.

John, may I ask a question?
What is happening is the psychological anchors are loosening. So we see giddy behavior like the rise in world markets on Tuesday/Wednesday.

How would you describe the thought process in the mind of the individual or group as this event, the market drop in assigned value, unfolds?

Are there steps you have imagined or would conjecture will occur?

TIA for your ruminations.

As an aside, the runup of T/W is very likely a pump fake, as someone said, a running of the stops. The weak shorts are now gone as they were decimated and in Mish's blog commentary, one mused about throwing in the towel as they had been so economically inconvenienced by that rise. I see it as greasing the skids myself.

Re: Gold....added by copying from www.jsmineset.com a posting on Wed, 9-19, at 1:30 pm, appearing late that day...Jim's view on gold, after gold was well above 715...it was about 723, spot, and now at this repost 5:30 am PST, gold's at 730:

"Here is how I anticipate the Gold (December Comex) story unfolding:
This move does not take out $800 without some very hard work.

• $782 - $792 is where the battle begins
• $800 will, of course, be passed in time.
• $751 to $761 is to me a given.
• $714- $715 is a place where significant buying will occur"

Head's up: this trading day in NY shows gold with a second day of an up gap. This is dead serious stuff. Either gold drops to 424.50 today to close the gap, or we're watching something I don't understand...a double breakaway gap. That's amazing, and probably occurred in 1981 as well. Jim's talk above about resistance at 782-792 is really unimportant. The price rise from low 7 to high 7 is stunning and profitable in and of itself alone.

And for a first time, you attention is asked to be on silver. It for the first time is now moving higher faster than gold. This probably means India is now in the game of dumping USD as well. They're poor and they love silver.

According to GD, when the crisis in the 4th turning doesn't materialize or doesn't climax, the nation then enters a 5th turning, where the danger of a crisis remains. Let's see, what are some qualities...

We know there are increased suicide bombings from Muslim countries. This means increased self-sacrifice during a time of relative "peace." Suicide bombers only make up a small proportion of the population, but still, this indicates a higher amount of fanaticism. There is also a quasi-1st turning alignment: Nomads in elderhood, Heroes in mid-life, young adult Artists, and child Prophets. However, there is a difference: Without an end to the crisis, the generations don't fit into the Fourth Turning diagonal model:



I suppose that there is a possibility of the feeling of an upbeat 1T as Nomads and Heroes control society; but in a 5T the danger lurks, and any sense of the 1T should be false. How will a society react to problems? It's hard to tell. At this moment (in my opinion, of course) our 5T countries are: Ireland, Mexico, portions of West Africa, Turkey, portions of eastern Europe, Russia, Morocco, Greece, Saudi Arabia, and possibly South Africa.

Justin '77 concludes that the Russian people have reacted to recent incidents in a calm and collected manner, and the "evil empire" overtones we continually hear in the West simply don't reflect the true situation.

What conclusions can we draw? What reactions should we expect? There has been very little research on this matter, so it's difficult to analyze.

Just thinking off the top of my head...

Interesting quote from Greenspan on the concept of fear regulating the prices in the marketplace.

He says late in this interview that if he could chart and understand "fear", he would not need any sophisticated economic analysis.

Duh!

We all know this. I've looked primarily at fear. I'm interested in it as a basis for market movement. Hence the dynamite triangle, which played out, but was not "safe" (as in sure thing) because it took too long to materialize. And the weak reversal in the up direction of the DJIA, which has a high probability of failing. Each of those represent compressed emotion.

When the rising reversal breaks down, as I said in a big arc, it will collapse enormously. It's fear, the surge against fear...elation that fear was not correctly assumed, and capitulation to fear when the low is taken out by the defeating arc. The battle to deny that fear is correctly identified is fought in the marketplace, but loses over and over until it nears the low point and then freefall as the longs in this case scramble for cover. It's coming. The chart pattern is common.

As to gold, the argument asserted is that the dollar is dropping. OK. But the chart fact is that gold is in a rising pattern and that underlies insecurity in fiat. Note that for the Euro, gold is at or near a 28 year high.

This is a good time to learn and profit from prior strong, market responsive events.

Dear Pat,

Originally Posted by The Grey Badger

> The Dow has already gone up more than 300 points according to CNN
> over an hour ago.

It's an "upward crash."

Sincerely,

John

John J. Xenakis
E-mail: john@GenerationalDynamics.com
Web site: http://www.GenerationalDynamics.com

Dear Gaudia,

Originally Posted by GaudiaRay

> 2 days later, early morning in the USA.. imo, gold will hit the
> 800 number leaving all who are not honest aghast, with gold at 730
> spot in London.

> John, may I ask a question?

> What is happening is the psychological anchors are loosening. So
> we see giddy behavior like the rise in world markets on
> Tuesday/Wednesday.

> How would you describe the thought process in the mind of the
> individual or group as this event, the market drop in assigned
> value, unfolds?

> Are there steps you have imagined or would conjecture will occur?

It's absolutely amazing to me how blind investors are. When I was in
school in the 1950s, my teachers would talk about the mistakes that
investors made before the 1929 crash, and I've never understood how
they could be so gullible and clueless. Now I do.

What's going on today is absolutely mind-boggling. The average
investor appears to be as dumb as a stump. And to think that there's
even a possibility that these stumps will push the stock market
bubble up past Dow 14,000 to a new high is almost too incredible to
be believed.

** Stock markets again are approaching a new all time-high
http://www.generationaldynamics.com/cgi-bin/D.PL?xct=gd.e070923#e070923

Originally Posted by GaudiaRay

> Interesting quote from Greenspan on the concept of fear regulating
> the prices in the marketplace.

> He says late in this interview that if he could chart and
> understand "fear", he would not need any sophisticated economic
> analysis. Duh!

You ought to give links when you make this kind of reference, so that
people will be able to check out what you're referring to. In this
case I know what you're talking about -- Greenspan's interview on
Comedy Central with Jon Stewart.

http://www.comedycentral.com/motherload/player.jhtml?ml_video=102970&is_large=true

This interview is absolutely fascinating, especially the remarks that
you cite, because he says that macroeconomics forecasting is just as
bad today as it was 50 years ago -- something that I've been saying
over and over -- and that the only thing that matters is investor
euphoria vs fear -- something I've also been saying. Now if he only
knew a little generational theory, he could have put the whole thing
together. I'm planning to write something about this interview.

Also, take a look at my two articles on the "fear index."

** By one measure, investors are getting increasingly anxious and worried
http://www.generationaldynamics.com/cgi-bin/D.PL?xct=gd.e070913#e070913

** More on the Marketpsych "Fear Index"
http://www.generationaldynamics.com/cgi-bin/D.PL?xct=gd.e070918#e070918

I've been following this fear index on a daily basis for a couple of
weeks now. Each day I watch CNBC and make my own judgment as to
whether investors are anxious or sanguine, and then the next day I
check to see if my judgment is matched by a change in this fear
index, and it's been very accurate so far. This appears to be a very
powerful tool.

Sincerely,

John

John J. Xenakis
E-mail: john@GenerationalDynamics.com
Web site: http://www.GenerationalDynamics.com