The US Asset-Debt system is undergoing an 1807 36/90/90/54 year  :: x/2.5x/2.5×1.5-6x Self-Assembly Great Fractal Cycle with asset valuation lows in 1842/43 and 1932, and a high in 2021.

The 90 year Third Fractal and the 54 year Fourth Fractal are composed of two interpolated equity fractal series  starting in 1932. The first series was a 10-11/21/21 year fractal ending with a yearly low in 1981/82. The second equity series, the Volcker US bond low series, began in 1981/82: and consists of 13/33/33/18-20 years, ending in 2074-76

The Volcker Second Fractal series started with a 3/7/5 year 13 year base  equity fractal from 1981/82 to 1993/94.   The second fractal to this first base was compose of two sub-series:  3/7/7 year series ending in 2009 and a 4/10/4 of 6-7 year series ending in 2025-2026.

Volcker’s 30 year bond prices decreased from their 15.1% high  in 1981 to 0.8 percent in 2020.  The lowering of bond rates correlated to both one: rapid money supply expansion with the accumulation of 93 trillion dollars of total US debt rising to an unprecedented 350% of GDP,  and two: with an asset  super bubble. Composite US equity valuations rose to the November 2021 90 year  Third Fractal high and housing valuation prices rose beyond the 2007 peak price to wage earning ratio. Financial  corporations, enabled by low mortgage  interest rates and advantaged availability to capital, drove valuations up, crowding out wage earners.

The Fed’s recent mini Volcker attack on consumer price inflation has taken  the fed funds rate in less than a year from 0.25  to 4.25-4.50, an unprecedented 1800% increase above the nadir rate. This percentage increase has never happened before. With the massive  US debt to GDP ratio and extreme housing valuations, this accelerated interest rate increase will result in a nonlinear 13/30-33 year 1981-82 second fractal  asset valuation price collapse.

At 93 trillion dollars of debt supported by only 26 trillion GDP,  mostly service job related, the US asset-debt system cannot tolerate 3.5-4.7 interest rates. During the US Fourth Fractal’s next 52-54 years, interest rates will not only return to zero levels, they will (must), like Germany, become negative for  to the asset debt system to survive. The disparity between the working class and those individuals and entities with disproportional access to capital and having financial assets grown disproportionally by negative rates, will become greater. The rich will enable a sympathetic populist to gain control of the political system.

The final 6-7 years of the 2009 4/10/6-7 year second subfractal series is likely composed of two subfractals : a March 2020 8/17/13 of 13 of 17 month subfractal series with a possible repeat of a similar monthly fractal sequence.

Over the next 11-12 trading days expect nonlinear declines in the Wilshire, Gold, and Bitcoin to conclude the Equity March 2020 8/17/13 of 17 month subfractal series.

The US 1807 36/90/90/54 year asset debt valuation cycle.

Cycles  of debt expansion occur causing increases in asset valuations until bad debt cannot be sustained, then  bad debt liquidation and asset valuation declination synergistically feed on each other. 

1932 ended the US Second Fractal 90 year debt expansion and collapse cycle and November 2021 ended its Third Fractal apogee 90 year finale debt expansion and asset peak valuation cycle.  

A 1932  first subfractal 10-11/21/21 year debt expansion cycle ended in 1982 with  Volcker’s interest rate hike solution to contain consumer  price inflation.

The initial cycle of the 1982 Second Subfractal, secondary to the 1932 to 1982 51 year First Subfractal cycle, was composed of a 13 year 3/7/5 year cycle ending in 1994.  The second subcycle to this 13 year base is compose of a series of sub fractals: a 1994 16 year 3/7/8 year cycle ending in 2009 and thereafter 2 subseries; 2/4/5 years and 2/4/4 years. Each cycle unit has ended with an underlying trend line containing all of the preceding valuation lows as bad debt was liquidated.

If the asset debt system maintains its previous consistency,  a valuation nonlinear low for the SPX will be about 1000, a 75 % nonlinear decrease from the current valuation.  From 2009 the two cycles are each roughly 17/35/35  months.

Expect a riveting hard landing for asset owners as asset valuations fall to long term trend lines.

The idea construct for the theory of saturation macroeconomics is occam’s razor simplistic, money under the given central bank expanding and contracting money supply conditions both  via fractional reserve banking and since 2009  QE/QT expansion/constraints … flows to the maximum extent  into the most advantaged and leveraged asset classes, that is, the equity and property markets. The progression to  the maximal extent and peak valuation and subsequent nonlinear terminal nadir values is fractally time  based  and in accordance with two eloquently simple 3 and 4 phase time based sequences :: x/2-2.5x/2-2.5x/1.5x and x/2-2.5x/1.5x-2.5x. 

For the US hegemony the overall long term sequence is a 4 phase x/2.5x/2.5x/1.5x fractal pattern starting in 1807 and consisting of 36/90/90/54 years with a first fractal equity valuation low in 1842/43, a second fractal low in 1932,  a third fractal 90 year  high in November 2021, with an expected fourth fractal low in 2074.

From the property bubble low in March 2009, US equities have followed a 5/13/10/7 month pattern (x/2.5x/2x/1.5x); followed by a 3/7/6 month pattern (x/2-2.5x/2x); followed by a 8/17/17 month pattern (x/2x/2x), followed by a 10/26/16 month pattern( x/2.5x/1.5x) and finally a 8/18/11 of 12 month pattern (x/2.5x/1.5x), the the latest fractal sequence starting with both unprecedented money expansion and thereafter money contraction in response to, respectively, the Covid pandemic and resulting consumer commodity and price inflation secondary to  extraordinary money expansion.

The daily market valuations represent the real status of saturation investment under the changing central bank lending parameters. Does the real market valuation progression data fit an occam razor’s theoretical mathematical fractal constructs? 

From the 22 November 2021 secondary Wilshire peak and Nasdaq key reversal valuation day peak 43 days (7/14/14/11)/ 101 days/102 days/ 52 of 62-63 days (x/2-2.5x/2-2.5x/1.5x).

Expect nonlinear lower low valuation declines over the next ten trading days