Daily Archives: October 8, 2018

SP500 1980-2018 Bull Market Review

 

The 1980-1981 time period was a pivotal year of some major turnings. In 1980 the gold price peaked and then crashed, while stocks were ready to soar. Stocks soared for a 20-year run until the dot-com bust in 2000!  The year 2000 was just an Intermediate degree wave 3 peak and followed by the 4th wave bottom in Intermediate degree. The 2007 peak was weak, and just barely fit into wave 3 in Primary degree. During the 2008 crash, nothing was left unscathed, as all asset classes took a beating, except for the US dollar, as it exploded in price during that time. 2008 was only a Primary Degree deflationary crash, but since the January 2018 peak, we are facing a Cycle degree wave 4 crash that will make 2008 look like a garden party!

Any crash will not happen in one move but it will take 3 moves to complete and should be a longer decline than in 2002. It should also take longer for the Cycle degree crash to play out. This will be my third bear market crash I will be counting out, which looks like it contains an expanded pattern, that most wave analysts, ignore or they are not watching for any of these expanded flat patterns to occur.  The Intermediate degree “C” wave decline should stop at the “A” wave in Primary degree, which could see a move down to the previous 4th wave. This still could take the rest of the year to play out.

2022 will be the expected bottom, which could end up well short of breaking new record lows. Megaphone and single trend lines are pretty useless in forecasting a bottom, as the markets will always try to fool us, doing something nobody expects. 2008 was also a solar cycle #23 bottom which was the main power that sent the markets soaring again.  Most big market crashes happen 1-2 years before a solar cycle bottom, and the exact same situation will be setting up by 2022 when solar cycle #25 starts to crank up. If you don’t think that the sun affects the markets on earth then, I suggest you do a few hundred years of research as it has happened many times before.

1932 was another one of those times, which makes 2022 a 90-year bottom. (3, 30-year cycles) 30-year cycles dominate the commodities world, and to some extent, the stock markets also have this 30-year cycle. The world has been building into the most inflated world in financial history, much like the 1929 time period.

The demographic shift of the aging boomers is going to be the main reason why deflation, and not inflation will be the real threat. Since 2011, 10,000 boomers are retiring every day, which should continue until about 2030. It’s not rocket science, what these boomers have to do as they will not leave their money tied into stocks, and they will have to start selling off their investments. Boomers already took a beating in 2008 but were told to stay in it for the long term. Yah, Right! Who in their right mind can handle a 70% or 80% stock market crash?  Nobody can build a “bullet proof” investment portfolio, unless you can jump into cash, in a very short period of time. F.O.M.O keeps investors in the markets until they are so scared and ready to throw in the “white towel”, when the crash starts to get serious.

When that happens then chances are very good that the markets will turn and soar in another 8-13 year bull market, with 2029 being a potential Primary degree wave 3-4 correction.

 

 

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