Here's the original chart and the reasoning behind it.
February 8, 2010
Stimulus Physics
Click to enlarge.
Stimulus was applied. Stocks rose into the air. Many seem convinced that stocks will keep going up. Who knows?
Please don't read too much into this. Almost anything can happen in a world filled with cartoon stimulus and/or cartoon physics.
Here's where we are now (with a new projected trajectory).
Click to enlarge.
The following is an alternate path and one I would prefer if forced to make a prediction.
August 22, 2011
Stagnationary Prediction Update?
Click to enlarge.
A flatlining outcome is fully consistent with a permanent Rubicon environment. You can pretty much guess that it is my personal favorite, if only to keep the ongoing Rubicon joke alive.
The future's so bright, I gotta wear [rose-colored] shades.
This update was requested by Fritz_O in the comments of the last post.
See Also:
Stimulus Physics
Stimulus Physics Update #1
Stimulus Physics Update #2
Stimulus Physics Update #3
Stimulus Physics Update #4
Trend Line Disclaimer
Source Data:
Yahoo: Historical Prices for Dow Jones Industrial Average
Real Estate Newsletter Articles this Week: Existing-Home Sales Increased to
4.15 million SAAR in November
-
At the Calculated Risk Real Estate Newsletter this week:
[image: Existing Home Sales]*Click on graph for larger image.*
• NAR: Existing-Home Sales Increase...
11 hours ago
4 comments:
PRE: "Permanent Rubicon Environment"
CP,
PRE: "Permanent Rubicon Environment"
It will be a cold day in hell before our economy PREezes over again, and again, and so on!
I clearly missed your renamed edition of stimulus physics.
I disagree with your future projections though. IMO you are not bearish enough.
With all the loans the Fed....uh...our Fed...made to European banks during the fin. crisis of 2008....well, whenever...we are clearly joined at the hip with the EU.
We're going down just as they are.
Will my O come true? I believe it will. I'll gladly come back here to own up either way.
Signed, and submitted,
Fritz_O
Fritz_O,
I disagree with your future projections though. IMO you are not bearish enough.
Perhaps our difference is simply a timing issue? If the DJIA is trading at its current level in 10-20 years then most might consider that to be extremely dire (with the potential to be horrific if inflation picks up at some point).
Just a thought.
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