Quantitative Saturation Macroeconomics: How the Asset-Debt Macroeconomic System Works

Both the Wilshire and Bitcoin in USD reached a daily average high valuation on 8 November 2021. These high valuations occurred in the 90th year of a US 1807 36/90/90/54 year fractal series with valuations lows in 1842-43, 1932, and an expected low in 2074. 8 Nov 2021 is contained in an interpolated March 2020 8/16/11 month fractal series. (Monthly composite equity valuation fractal series since the March 2009 low have been respectively and sequentially: 5/12/10/7; 3/8/6; 8/17/16; 11/26/16; and currently 8/16/10 of 11-16.)

The central bank expands and contracts debt/money to sustain the asset-debt macroeonomic system with the bank’s defined antipodal boundary conditions of 1. unacceptable unemployment vice 2. unacceptable consumer inflation. The asset-debt macroeconomic system integrates  the central bank’s manipulation of credit/money expansion/contraction and then self-orders and self-assembles asset valuations into the most efficient time-based mathematical trading saturation growth-to-peak valuation fractals, and trading saturation decay-to-nadir valuation fractals. Within major valuation growth trends there is periodic countertrend decay  and vice-versa. These time-based saturation trading valuation fractals are seen on minutely, hourly, daily, weekly, monthly, and yearly unit scales. The system has only two simple self-assembly self-ordered patterns: xy/2-2.5xy/2-2.5xy/1.5xy and xy/2-2.5xy/1.5-2.5xy.  Here xy is used for both possible growth (higher valuation)and possible decay(lower valuation. (The 1807 35/90/90/54 year pattern conforms to the first fractal. pattern as does the initial March 2009 5/12/10/7 month fractal pattern).

The current operative weekly model for this efficient simple self-assembly self-ordering mathematical process dating from 24 January 2022, the start of the final 11 month decay (8/16/11) is consistent with a 7/15/14/10 week (xy/2-2.5xy/2xy/1.5xy) pattern. (using the weekly DJIA or Russel 2000 composite, a nonlinear valuation drop is seen between the 14th and 15th week of the 15 week second subfractal of the 7/15/14/10 week series; this nonlinearity characterizes the terminal 2xy-2.5xy portion of second fractals -see 2005 main page of website).

The final 10 weeks appears to be composed  of a 2/4/4/3 week :: xy/2xy/2xy/1.5xy series. Friday 14 October 2022 would be a low in this simple mathematical fractal model followed by valuation growth to about 8 November 2022 followed by a 3 week significant valuation drop. (The corresponding daily fractal series from 6 September 2022 appears to be 9/21/18/12-13 days.) Grayscale Bitcoin, a proxy for bitcoin in USD is following an interpolated 17 June 2022 17/34/31 of 34 day decay series :: xy/2xy/2xy series (ending 14 October 2022). The historical mismatch of the current 7+% 30 year mortgage rates (22 year highs) and highly inflated residential prices (50 % over two years -2019 to 2021- for existing homes 251K to 377K )has collapsed the pool of potential able buyers. A severe economic contraction is qualitatively predictable. The 8/16/11 money decay fractal series (xy/2xy/1.5xy) is likely to be extended to a 8/16/16 month fractal series (xy/2xy/2xy).

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