Wilhelm Abel, David Fischer - The Great Pricing Waves 1200-1990 AD

"... History never repeats itself, but it rhymes. ..." (?John Maynard Keynes?)

Table of Contents


NOTE : The model here is DEFINITELY NOT suitable for application to [trade, invest]ing! It's far too [early, incomplete, immature, erroneous]! See Steven Puetz's http://www.uct-news.com/ for the investment side of the UWS.


Model results

"SP500 & DJIA indexes back to 1872"

Linear semi-log segments [1872-1926, 1926-2020]

Fibonnaci levels versus log-levels
Larger Fibonnaci's at greater timescales

How do I get negative numbers from a log transformation of the data?



What's [wrong with, missing from] the current model?


Are [political, economic, philosophical, psychological, sociological] theories unimportant?

The easy answer is "YES", as these seem to pre-occupy everybody, and everybody seems to have their own ideas (which are almost invariably other people's ideas, which are almost invariably of origins in antiquity) to impose on others.

But a justifiable interpretation of the price revolutions, and the analysis of BOTH [Alfredo Pareto, Benoit Mandelbrot] that wealth distributes are the same across societies (slopes can differ), is that our "brilliant ideas count for far less than our egos tell us. This seems be a particular problem with intellectuals, perhaps because of their very [nature, priviledged positions].

While ideas seem to be important, it's easy to forget that they also can cause massive problems, and there is little indication that we can think this through reliably.

I almost suspect that with progress, machines may better derive models and concepts than humans, which might be better based on data rather than "conclusions-driven bias" of [fragile, incomplete] human intellect? In many cases, they could hardly do worse.


And for the future?

Picking up a point from the section below "Linear regression of price [revolution, equilibrium] segments" :
We don't know [how, when] the "modern price revolution" will end, so I've merely used the last data-point. It's probably going to be bad, but as Fischer states, the impacts on people of crashes from price revolutions have become FAR less traumatic over the last eight hundred years. I suspect that this is due almost entirely to technology and changes from local-to-global trade. These have generated increasing "better than the pharohs" wealth, far greater stability.