From Nick O’Connor – Capital & Conflict (Great Britain) –
What if everything we see in the financial markets isn’t quite as it seems? What if – behind the stories, the headline figures, the daily numbers we all see reported – there’s something else going on?
Shock horror… what if by understanding what’s going on deep within the economy – the big cycles that few people spot and even fewer understand – we can predict what’ll happen in the financial markets, and profit from it?
Today we’re going to test that theory out. We’re going to talk cycles. If you want the short version, I’m going to show you what three particularly important long-term cycles are telling you to do with your money right now.
Two say buy certain assets… another is flashing an almighty sell. But which assets?! And which cycles?!
The sixth irruption
Does the world of technology advance at a steady pace? Or are there certain times when a specific technology comes along and reshapes the rest of the economy for good?
I’d argue the latter. Look at the steam engine, the internal combustion engine, mass production and the silicon chip. They were all so disruptive that they completely reorganised the world around them.
And they didn’t arrive all at once. In fact when you look back, they hit the world at regular intervals – and unfolded in a very similar pattern, like the seasons in the year.
In short, they are part of a cycle.
It’s an idea that comes up in the work of many respected academics and economists. According to Carlota Perez, a Cambridge scholar, these events are called “technological irruptions”. She describes them as the emergence of:
… a powerful and highly visible cluster of new and dynamic technologies, products and industries, capable of bringing about an upheaval in the whole fabric of the economy and of propelling a long term upsurge of development.
The Nobel Prize-winning economist Simon Kuznets calls these technologies “epochal innovations” – ones that are capable of changing the course of human history, inducing significant and long-lasting changes in the world economy.
The celebrated Russian economist Nikolai Kondratiev called these cycles “long waves” – the deep 50 to 60-year cycles in the economy, driven entirely by the emergence of technology.
But it doesn’t really matter whether we call them irruptions, epochal innovations or long waves. What matters is that certain key technologies act as the triggers of history: they’re powerful enough to reshape the world, to create huge amounts of wealth, and to bring about long-lasting, meaningful and positive change.
The kind of change that could make you a fortune if you could understand and anticipate it.
There have only been five such events in the history of humanity. And here’s the thing: all the signs suggest the sixth is almost upon us. You will live and invest through it in the very near future.
My prediction is this will change the world in such a radical way that most people will feel completely left behind. So for the past 18 months I’ve been working on a new project, writing and researching a book that explains what the biggest new technologies in the world mean for you and what you can do to profit from them.
And how about this? This very day – Thursday 17 November – it’s being published for the first time. If you want to read it, I’ll happily arrange for you to receive a free copy – just follow this link now to find out more.
The property cycle: 18 = 14 4
On to another cycle that’s flashing a particularly important signal for UK investors and savers.
First up, let’s consider the “consensus” view on property: it’s overpriced and it’s due a fall. Just yesterday Bloomberg reported that land values in central London fell 10% in the year to September, as Brexit and higher taxes weighed on prices.
Reading stories like that, you’d be tempted to call the top for UK property. But remember our theory today: we’re exploring the idea that there’s something else… something more powerful and important… driving the markets.
According to my colleagues Akhil Patel and Phil Anderson, that’s exactly the case. They believe there’s a pattern at work in the property market (and indeed the stockmarket), that gives a “rhythm” to prices. Understand the rhythm and there’s a huge opportunity on the table for you.
They’ve been hard at work with Dan Denning all summer on a new piece of research outlining their idea in full. To be frank, you should read their work in full. I know thousands of readers already have. But here’s their key idea in short:
What if you could forecast with precision every major turning point in the financial markets?
What if you could apply this kind of specific foreknowledge, not just to stocks… but to all asset markets…?
It’d make your financial life vastly easier, right?
Whether you’re an investor, a speculator, a trader, a retiree or a property investor…
This is why you should read what follows very carefully…
Never again would you have to worry about what will happen next year.
Never again would you be caught out in a down move on the stockmarket… in fact you’d be able to profit from them.
If you’re a rational person you’re probably sceptical about any kind of long-range market prediction.
Let alone one pinpointing specific dates.
If someone really did discover a universal law that helped them make such predictions… they’d be Time magazine’s Person of the Year, surely?
Well, I ask you to reserve judgement until you’ve seen some of the incredible things 18 = 14 4 has already predicted… in most cases years in advance.
Right now this property cycle is predicting something pretty unusual is about to happen in the property market. If you own a home (or want to) you should read it. You may not agree with it. In fact, I’d encourage you to challenge it and question it carefully. But you need to read it and give it some of your time.
The worst time in history to buy bonds?
Hands up if you’ve lent money to a government in the last three months?
No takers? No gilts, treasuries or bunds tucked away in your portfolio? How about your pension fund? Perhaps that’s a story for another day…
Anyway, I’m going to assume that you haven’t lent any money to the Mexican government this year (or probably ever). But some people have. Believe it or not, there’s a Mexican 100-year bond in existence. That means there are people out there willing to lend money to the Mexican government for 100 years.
At least in theory. More likely the 100-year bond would be a vehicle for speculators (and a way of the government borrowing money). If you’d speculated on the bond over the summer you’d be feeling pretty awful right now. The bond has fallen 20% since August. It’s down something close to 10% in the last week alone.
It’s an extreme example of what happens when the cycle in the bond market turns against you. Bond prices have been in a 30-year bull market – an up cycle. With inflation expectations picking up, that cycle could be at an end.
If it is, the rules of the financial markets are changing around us. So be ready. A big, powerful trend like this is like a ship turning in the night. It may take a while to change course. But once it does… you don’t want to be caught on the wrong side of it.
More on that in a future issue. For now though, keep one eye on the daily markets… and the other on the long-term cycle. We’re at the turn of the tide in more than one way!