Ivar's Charts

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a few questions

As I begin to look at your charts....my first questions  (if you have already addressed these questions please post the link so I can just go there and read to save time and trouble)

it looks like your gold and silver charts are forecasting a hyperbolic rise in price just before the 2012 presidantial election. with silver doubling  and gold almost doubling (1700 area to 3000)

Question. .....  What is it about the 'presidential election' that will cause gold to blast off ...and silver a month or so before gold.?

Is this the only 'major event' that will be  the cause for the price move?

Are there other important causes or events?

Why do you consider the presidential election to be so critical to this price   trigger?

Does it matter whether a democrat or republican is elected, does it matter whether an incumbent or challenger is elected,does it matter whether the election was  fair or fraudulent? etc etc , what is the significance of the presidential election to the timing of your chart forecasting. ?

I would consider the presidential election to be a somewhat minor event  in terms of  geopolitical and stock market and economic   developments. Most  people in the usa see very little difference among  candidates who become presidents.The successive administrations  maintain the same policies, etc.

Something like a war would be much more important. or a natural disaster, or something like that.  Collapse of a major bank,(like Lehman in 2008)....  

just a few questions  to start .

Thanks

.

ivars
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@Sheeple does presidents matter

As I begin to look at your charts....my first questions  (if you have already addressed these questions please post the link so I can just go there and read to save time and trouble)

it looks like your gold and silver charts are forecasting a hyperbolic rise in price just before the 2012 presidantial election. with silver doubling  and gold almost doubling (1700 area to 3000)

Question. .....  What is it about the 'presidential election' that will cause gold to blast off ...and silver a month or so before gold.?

Is this the only 'major event' that will be  the cause for the price move?

To be honest , i do not know but will try to present my view-since the correlation with election cycle is not my wish, that is just how charts came out.

First, the doubling of silver and almost doubling of gold are bubble, so based on herding of the opinions what is to come- similar herding happened in May with silver, when everyone was saying this is cheap, people in China, India buy up all worlds silver in retail etc.  The value after election for Gold settles at 2700 for some 6 months ( from 1800, so 50% increase), Silver at 45-55 fo almost 9 months ( from 40, so about 25% increase) . The peaks are just bubbles, self feeding expectations.

So we can say, short term prior  to the increases are bigger, then after elections they settle at somewhat lower, but still high values. 

The only economic principle I have surely derived for myself and that seems to come up again and again is that the USA ( not even mentioning most of Europe, Japan) will be in recession from Q1 2012-onwards. A long one.

So the obvious question for the president and congress and senate and "independent" FED chairman who serves TILL January 31, 2014 ( so he will be the same) what tools and at what scope they will use to get economy moving. (by the way, gold chart makes a significant dip in January 2014 so who will head the FED seems of crucial importance in January 2014).

So far I have learned of 2-QE and stimulus. Stimulus is anyway partly becoming a form of QE because by end of 2012 most US debt will be bought by FED. FED is getting more powerful as recession progresses.

My interpretation then:

1) USA in recession 2012  Q1, Q2 , Q3 but there is no QE nor stimulus- but they are definitely promised by Obama if he gets reelected

2) Republican candidates (also to House/Senate) are perhaps trying to keep a strict line of no more stimulus/QE,   as government debt continues to grow and next ceiling will be needed already in 2012. So gold waits as the outcome is not sure, while silver is more prone to mood swings being more affordable. 

Anyway, Obama seems a weak candidate but if he wins, stimulus and QE is coming.

3) With recession continuing, life gets tougher, and Obama's chances to win by promising more QE -> stimulus grow, so a bubble starts to form in especially silver but also gold , that predicts as usual infinite printing of USD, but as usual forgets about the restriction placed by the USA debt  and reserve currency status, whose buyers/owners other that FED does not like too fast USD devaluation.

4) in the end, whoever wins, moves on with stimulus/QE  as neither winner is really and alternative to each other and does not see any real other short term "solutions"-hence prices remain elevated.

5) If I remember correctly, in May 2011 with silver, and in August 2011 with gold bubbles, there were no events at all that would have been responsible for corresponding 88% and 27% increase in prices in the top of the minibubbles, so presidential election could be a triggering event, but the underlaying cause is continuing long term credit bubble deflation, recession and how to get out of it.

6) the price of gold after 2014, jau 31 shooting up seems to indicate that Bernanke will stay for 3rd term and that may mean that
Obama wins his 2nd.

How does is sound?

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Absolutely, if a conservative

Absolutely, if a conservative wins the US election on an austerity platform watch PM's nosedive.

Meanwhile Chairman ObaMao is promising 20 year olds they won't have to repay 10's of thousands of dollars in student loans & loosening credit standards for housing loans/refi's to stimulate real estate. Did you know you'll be able to buy a house, or rather an existing mortgage, for $100 USD?

So we're already QEing & pandering for votes with borrowed money.

I just paid off my student loans, it took me 15 years. Now I have to cough up a sizeable amount of cash for property taxes next week and I'm furious that part of it will be given to lazy slobs & overpaid government functionaries. Damn I'm being redundant, I hate it when that happens.

Ivars I'm seeing a possible blind spot in your approach here. You speak of "the charts" as if they are written in stone and events come to meet them instead of the charts being prompted by events.

Perhaps I simply don't understand what you're saying.

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@drifter, charts are driving events

Ivars I'm seeing a possible blind spot in your approach here. You speak of "the charts" as if they are written in stone and events come to meet them instead of the charts being prompted by events.

That is true. Every market, represented by a price/time chart, is a system, some essential part of whose behavior as whole is represented in this chart. In such complex systems, predicting events and than trying to predict chart long term is impossible. That would be physics. Here, on the contrary, the dynamics of charts themselves might be predictable based on some assumptions about the market and , most importantly, that its properties does not change too fast, so past patterns allow to predict future. That is how i get my charts. Now, what events might create charts similar to the projection of past into future- that is a question to a historian of relevant subject. I am not that one, but feel free to interpret what You see on the charts.

On other hand, charts drive events. E.g. traders look at charts and make decisions , than look at charts again. Bernanke looks at stock prices and releases QE or does not. etc. Happy are those people who does not have to look even at their income/spending chart and can make decisions which are independent of these numbers, but I do not think there are many such.

If something totally does not make sense, or if the chart happens to be wrong already in first months since its charting, it has to be looked at once again, and either the deviations can be explained ( like in my 1929-2008 comparison chart deviations in stock prices  from what would be expected are caused by QEs), or, the chart has to be redrawn -its dynamics are different- or prediction just does not work with this particular chart, or even that market (too small, too Gaussian=efficient=random-unpredictable).

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COT report for silver

ivars

this week’s cot report for silver indicates that the commercial bullion banks have increased their net short position by over 4000 contracts into this rally. Overall the commercials net short position in silver is much smaller than before the most recent smackdown in silver...but as the price of silver is rallying it seems that more short positions are being added. Is this figued into your projections at all?
I see silver rallying into the high 30's before the short position increases even more and we get smacked down again to 35. your thoughts?

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@austrian -short term actions are not figured, their results are

but as the price of silver is rallying it seems that more short positions are being added. Is this figured into your projections at all?
I see silver rallying into the high 30's before the short position increases even more and we get smacked down again to 35. your thoughts?

How can this be figured in IF  the chart I based my short term prediction made on September 27th here http://www.tfmetalsreport.com/comment/60954#comment-60954 was made on March 13th, 2011?

1) Silver may fluctuate around 30 USD (+- 3?) for 1 month or so, then move up sharply about 5 USD to 35-40 and drop again, now to little higher level of 33-35 +-5, and not change much anymore this year.  So the bottom will be kind of close from time to time during October.

2) Gold, on the contrary, seems to be posed for relatively steady growth till 1800 in November, around which level  it should fluctuate for few months (+- 50 ?) .

See, above I have predicted sharp move up by 5 (10) USD from October 27th or so, than drop again to 33-35+-5 in end of December 2012. Sharp short (daily) spikes in between are unpredictable from long term view. But I could not have predicted its connection with concrete actions- though logically, if silver or any asset moves down, there are more sellers than buyers around -so yes, of course, they will bring  current positive silver price blip caused by Euro zones last weeks debt problem projection on USD, down. 

Sincerely, I do not recheck the chart of silver presented here as long as prices behave as predicted-so I do not have much to add.

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Can you explain what happened in October with the DOW chart

SORRY IF MY CHART IS TOO SMALL TO SEE. 

YOUR  PREDICTION COMPLETELY FAILED THIS MONTH OF OCTOBER.   DO YOU KNOW WHAT HAPPENED ??

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thanks that was good Ivars

perhaps powerful unforeseen events will speed up or slow down certain sections of your charts then

there's one guy out there that's been there, done that and I trust his take on things PM above all others

Jim Sinclair

I would be very curious to see his reaction to your 2014-2017 time frame for the PM mania

and I have a feeling he would not dismiss it out of hand

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@Digger DJIA chart off both in February - August and October

Yes I know and have been putting attention to it, but have not been able to produce really better chart so left this standing- anyway, it showed move in the right direction in August-September 2011. I have made since than DJIA (2008)- DJIA (1929) comparison http://www.tfmetalsreport.com/comment/78031#comment-78031

and Nikkei -Nasdaq  comparison http://www.tfmetalsreport.com/comment/78036#comment-78036

And Greece -DJIA comparison: http://www.tfmetalsreport.com/comment/78157#comment-78157

All 3 of those show potential for some level of market crash starting in November and hitting the bottom in April-May 2012 (DJIA comparison chart, April and July (Nasdaq - Nikkei chart)

What is clear from these comparisons that my February 6th chart You refer was not referring correctly to the period in the past where Massive QE had worked in terms on propping up stock prices. Perhaps, such period has not existed in the history of the USA ( either in form of stimulus or QE) so there is nothing to take patterns from.

In 1929 there was gold standard that prevented it, in Japan QE  failed (as I have read and as stock prices show), the closest to the DJIA is Greece's wonder where we know they used massive stimulus in form of increasing government debt and deficit- and it worked, as can be seen from Greece's speedy index recovery after 2008 crash. Athens general even show a small blip up corresponding to March 2012 in the USA, than crash into April 2012 ( bottom chart).

So all in all,  it seems that all charts point to sharp correction in DJIA in April-July 2012, and from that I conclude that also USA GDP (since there is a correlation) will shrink in Q1 2012 ( may be Q2 2012 latest) and stay there for 2-3 years (negative or 0% growth ) or until defaulting, if not longer.

I have not found method better than comparing with e.g Greece how to account for positive QE effect visible in 2011 stock prices. The comparison with 1929 and Nikkei seems to tell that it requires growing  ( every day more money/day  pumped into FED->banks->stocks>banks>FED circulation system) so the whole thing is unsustainable but for how long its positive effects on stock prices can continue I have not found better answer than saying in April they either will run out of ammunition or decide to keep it dry for some time, so that US debt is not further threatened already in spring 2012. May be there can be another downgrade, or actions by some holders of debt that will send the message that QE can not continue for some time. Or, propping up Europe will use the printing power needed for the USA, so QE will move into Europe. 

What do You think?

Ivars

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New DJIA prediction chart 2011-2018-QE hopefully included

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DJIA new version 2012- 2016 for better visibility

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JY896 et. al   I finally

JY896 et. al

I finally had a chance to give more attention to your link.  Even though it was published in 2001, it gives an impressive description of what we can expect going forward.

Here are a few ideas I had.  The model they propose has as its single most important variable, population growth. Until recently accelerated population growth has been aided by enhancing factors, such as technology, agricultural development etc. combined with a reduction of limiting factors, such as infectious disease control etc.

However, the authors then go on to say that an estimate of accelerated population growth can only be accomplished with an infinite point in mind.  To the degree that this is not possible, since we live on a finite Earth, there will be a point in the future that will signal a "regime" change.

This regime change will include some spontaneous events, and these events are already factored in equations that contain log periodic corrections.  But that's just the mathematical side which is interesting enough.  What I'm ultimately interested in is the human component in this equation.

There appear to be some controversial spontaneous corrections,  earthquakes and stock market corrections, are two that are mentioned.  They do not include, which I think are worth considering, war, epidemics, other natural disasters such as flooding, tsunamis and of course the catastrophic realities of nuclear disasters (which can be either war or the likes of Fukushima).

Now this is my basic question.  Humans may be able to manage these events, so as not to endanger an/or seriously hinder sustainable growth or non growth, which ever may be necessary for the survival of mankind, by either constructive forces or destructive ones.

Constructive forces  include such things as a "collective" conscience as ScottJ reminds us of.  This would give rise to a global rebalancing of resources in a humanitarian way.  This would also limit the disparity between the haves and have nots, through a collective effort of enery reduction/ saving through green technology, global economic solutions without the attendant starving of the masses, etc.

The destructive forces in this solution is what we have all been addressing.  The efforts to sustain population reduction through pernicious methods by the few (who hold the greatest wealth and also power) and are accomplished through the many topics that have been covered.  Exogenous creations of earthquakes, volcanic eruption (via HAARP), economic impoverishment of the middle class as well as undesirable states, creation of war, biological warfare, and so on. 

The point is, accelerated population growth is no longer sustainable, let alone superxponential growth that the authors describe.  Emerging forces that will shape the future will be determined by the human spirit. The question is what qualities of the human spirit will prevail?

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@redwood

I don't have a comprehensive answer to your questions, other than these brief thought starters/comments:

- the lack of expansion of the population undermines the basic Ponzi nature of today's monetary regime. Among other things, this may be a contributing factor to the ongoing meltdown we are seeing

- there are projections which see population growth slow, stop and reverse:

http://www.zerohedge.com/article/human-race-doomed-deutsche-bank-one-most-important-future-turning-points-history

"If we make the same adjustment for the world’s fertility rate, we now have an EFR of around 2.4 which is almost at the replacement rate. In our view, the human race will no longer be replacing itself by the early 2020s. Population growth will continue for a few more decades because of momentum from the age structure and people living longer but, reproductively speaking, our species will no longer be growing. "

- this may be a naive/silly question, but does measuring economic activity by using DJIA/S&P indices and GDP figures make sense when one takes into account the a) debasement of the currency used to measure stock values, and b) the increasing manipulation of how GDP is calculated?

 

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ivars
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Older Original March 13rh Silver prediction chart 2011-2013

Its still valid until the newer longer term http://www.tfmetalsreport.com/comment/78025#comment-78025takes over:

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Older Original May 4th Gold prediction chart 2011-2013

It is still valid this year , but already during next prices at peak seem to low. Newer version here:

http://www.tfmetalsreport.com/comment/78024#comment-78024

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Silver Prediction reality accuracy comparison chart -7,5 months

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Thanks Ivars.  Appreciate

Thanks Ivars.  Appreciate your work and charts.  Short term analysis is very difficult, but it's useful to have an idea of where we are headed.  When making financial decisions, short term is important (to short term traders), but long term is essential for financial planning.  And your charts are the best I've seen for long term trends.

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This is a bookmark...

So I can follow from my history.

ivars
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Silver prediction reality comparison chart and extension to Feb1

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Any future development must involve changing something which people have never challenged up to the present,and which will not be shown up by an axiomatic formulation.

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GOLD prediction reality comparison chart and extension to Feb1

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Any future development must involve changing something which people have never challenged up to the present,and which will not be shown up by an axiomatic formulation.

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