Report Card for Donald Trump

[Warren Dew]

(01-03-2017, 02:07 PM)Mikebert Wrote: I first look at innovation wave/leading sector stuff in the 1990's.  Back then I saw the K-peaks in 1864, 1920 and 1981 and the period of strong growth afterward 4.7% (1866-73) 4.8% (1921-29) and 4.4% (1982-89) as the same points of time in the K-cycle.  These periods were followed by downturns and then a period of very strong growth afterward: 8.9% (1877-81) and 9.4% (1933-37). Both of these periods occurred during growth phase of cluster of leading sectors, or "new economy" as Harry Dent puts it. The previous growth phases ended in 1888 and 1937 for the industrial and mass-market economy, respectively and the current one was forecasted to end in 2007. Based on this concept I anticipated strong growth in the late 1990's, not as strong as in 1877-81 or 1933-37, since these were coming off economic lows, but still stronger than what was saw in the 1980's.  Didn't happen, growth over 1996-2000 was the same as in the 1980's.

This was all before generations. In 2000-1 I added the idea of generations to my thinking and concluded that the K-cycle was longer today than its historic 50-60 year length. Based on a correlation between the start of K-winter and the 4T in 1929, I took the apparent 2001 start of the 4T as evidence that K-winter began in 2000.  This makes the economic boom over the 1982-2000 bull market cycle equivalent to the 1861-81 and 1921-29 bull markets, for which growth averaged 4.9% and 4.8%, respectively.  Growth over the 1982-2000 bull averaged only 3.7%, a bit less but not way out of line.

But that wasn't right.  We now think 2008 is a 4T start and I did confirm that 2008 was a 1929-equivalent economic event.  So this means the analog to 1921-29 is now 1982-2007 for which average growth was only 3.2% due to poor growth of 2.7% over the 2001-2007 expansion.  In other words during the growth phase of the information economy growth was strongest in the 1980's before the internet, when PCs and floppy disks were cutting edge. The addition of much more capable machines, capable hard drives, and the internet (which changed everything so said the stock market boosters in the nineties bubble) gave us slightly slower growth.  Then after 2000, broadband, B2B and social media, brought us even slower growth. Adding smart phones since 2007 and a lot more social media hasn't helped--growth over 2009-15 was even slower at 2.2%.  These leading sectors aren't powering growth like they used to.  If what you say is true about all this huge spending on IT infrastructure creating growth, then it would show up in the numbers.

Why do you think the k cycle and the generational cycle have to be aligned?