The inescapable Financial Collapse; A 4-Dimensional analysis
This is the SP500 / Gold / the US Dollar / a G10 Composite Currency Index / Time / Price, all of it, all at once! - Lets call it: Universal Value. - Shall we...
This is a 2-Dimensional projection (being on a flat computer screen, after all :-) of a 3-Dimensional "Slice" of a 4-Dimensional space. - So try to visualize it. (Not as difficult as it first may seem.)
Envision a box with only 4 sides - i.e.: a tunnel - which constitutes the entire Universe, in which everything exists, and the only option for interaction with said universe is to twist the walls freely, into any desired configuration, along the tunnel's principal axis - in this case the horizontal, Time axis.
This is a broad-strokes, yet, reasonably accurate depiction of the concept of: Value. - In this case, projected onto the SP500 Index.
"How does one escape such a tunnel where one's options are duly limited (mathematically and physically) to only twist the walls of such a tunnel?" - You ask...
It is literarily impossible, so good luck with that!
Thus, cheer on, trade the hell out of it and take every last fool for everything they got! (Then run. :-)
... and just in case: There is no "Plan B"!
Here is a likely better - not "shifted" - view, ...
... of the "financial Universe" projected onto the SP500.
This is a 2-Dimensional projection (being on a flat computer screen, after all :-) of a 3-Dimensional "Slice" of a 4-Dimensional space. - So try to visualize it. (Not as difficult as it first may seem.)
Envision a box with only 4 sides - i.e.: a tunnel - which constitutes the entire Universe, in which everything exists, and the only option for interaction with said universe is to twist the walls freely, into any desired configuration, along the tunnel's principal axis - in this case the horizontal, Time axis.
This is a broad-strokes, yet, reasonably accurate depiction of the concept of: Value. - In this case, projected onto the SP500 Index.
"How does one escape such a tunnel where one's options are duly limited (mathematically and physically) to only twist the walls of such a tunnel?" - You ask...
It is literarily impossible, so good luck with that!
Thus, cheer on, trade the hell out of it and take every last fool for everything they got! (Then run. :-)
... and just in case: There is no "Plan B"!
Here is a likely better - not "shifted" - view, ...
Comment:
In addition, as it's been said before: "We don't have to predict the wind! - We just have to adjust our sails." - As evidence unfolds.
Furthermore, it may appear on this graph that the SP500 could break out to new, never before seen (record) highs but in effect that is nothing more than an optical illusion on a flat surface, i.e. in 2-D space.
In reality it does not matter how much more or how much harder this box/tunnel is twisted (Monetary Stimulus, Fiscal Stimulus, Santa Clause Stimulus, Jesus-and-all-the -Saints Stimulus, all that would accomplish is to "flatten the tunnel/box" even more - thus raise the edges ever farther away from the current SP500 peak - while approaching Infinity - i.e. a Singularity where all value would cease to exist.
Furthermore, it may appear on this graph that the SP500 could break out to new, never before seen (record) highs but in effect that is nothing more than an optical illusion on a flat surface, i.e. in 2-D space.
In reality it does not matter how much more or how much harder this box/tunnel is twisted (Monetary Stimulus, Fiscal Stimulus, Santa Clause Stimulus, Jesus-and-all-the -Saints Stimulus, all that would accomplish is to "flatten the tunnel/box" even more - thus raise the edges ever farther away from the current SP500 peak - while approaching Infinity - i.e. a Singularity where all value would cease to exist.
Comment:
Important Note:
Apparently I have failed to mention above that according to this chart, currently, as it stands today, "Fair Value" places the SP500 a hefty -61% lower and Gold prices ( measured in US Dollars) +38% higher than last Friday's close. - And Yes, it is an All-time High, as measured by this metric.
This is not a "good thing", though, as it translates into record "value destruction", globally!
Apparently I have failed to mention above that according to this chart, currently, as it stands today, "Fair Value" places the SP500 a hefty -61% lower and Gold prices ( measured in US Dollars) +38% higher than last Friday's close. - And Yes, it is an All-time High, as measured by this metric.
This is not a "good thing", though, as it translates into record "value destruction", globally!
Comment:
Here is a simple, no nonsense animation of a rotating Hyper Cube (4-D)...
i.gifer.com/6Hc.gif
... the edges of which represent the different variables (actually, their +1 Higher-Dimensional projections), for our purposes: Gold, U$D, SPX, the G10 FXs, and so on.
Some complications arise where, in our case, the hyper cube rotates and simultaneously undergoes torsion - i.e. it i also pulsates while rotating.
The above chart is a single "time slice" across such a cube.
i.gifer.com/6Hc.gif
... the edges of which represent the different variables (actually, their +1 Higher-Dimensional projections), for our purposes: Gold, U$D, SPX, the G10 FXs, and so on.
Some complications arise where, in our case, the hyper cube rotates and simultaneously undergoes torsion - i.e. it i also pulsates while rotating.
The above chart is a single "time slice" across such a cube.
Comment:
In comparison to the present state of affairs...
... here are the "Bush Recession Years" and the go-go 1990s.
Comment:
Incidentally, 3 facts(!!) emerge form this model, as it stands today;
1) The US Fed. is now holding it's entire Balance Sheet at a net -1.43% (negative) valuation; (I bet they don't even know it)
2) The Bank of England entire Balance Sheet just (last Friday) broke down below the 0% valuation level; (I bet they have no clue, either)
3) The SP500 now has a -1.678% Net Return "baked into the cake" - i.e. inescapable - for it's entire next cycle! This can get much worse - time will tell. (I bet, no one cares)
1) The US Fed. is now holding it's entire Balance Sheet at a net -1.43% (negative) valuation; (I bet they don't even know it)
2) The Bank of England entire Balance Sheet just (last Friday) broke down below the 0% valuation level; (I bet they have no clue, either)
3) The SP500 now has a -1.678% Net Return "baked into the cake" - i.e. inescapable - for it's entire next cycle! This can get much worse - time will tell. (I bet, no one cares)
Comment:
... additionally (since we got questions regarding that), our use of "ridiculous assumptions" even included such absurd notions as: "the value of Gold -> $0", or "The U$D ->0 - (or any, or all, of the G10 Currencies, all at once)", or that "the SP500 Quadruples any time between now and 2021", or that the "G10 becomes the G5 because the rest of them sink into the ocean", and so on.... None of that mattered! It can ONLY get worse from here!
Truth to be told, the singular assumption we did Not make is: The US Fed. (or any other) suddenly finds a way to print Time.
Truth to be told, the singular assumption we did Not make is: The US Fed. (or any other) suddenly finds a way to print Time.
Comment:
p.s. For those who would rather forecast the Amplitude of price change / Time for the SP500, as measured in U$D - also known as: Trading :-) -, this might help:
Comment:
... and when the above concepts are applied in the real world properly these are the type of results that one should expect;
- Nasdaq100 E-mini; +2036 pts. profit the last 14 days. TUTORIAL -
www.tradingview.com/...st-14-days-TUTORIAL/
... or like these:
www.tradingview.com/...k-s-result-57-R-O-I/
- Nasdaq100 E-mini; +2036 pts. profit the last 14 days. TUTORIAL -
www.tradingview.com/...st-14-days-TUTORIAL/
... or like these:
www.tradingview.com/...k-s-result-57-R-O-I/
Comment:
Comment:
This particular "measure of value" happens to be a rather accurate Leading Indicator - 91,3% accuracy on any 21 months horizon!! - of US and Global Equity cycle tops and bottoms, within an average of 17 days preceeding their actual occurrence!
However, to utilize this,one also needs to trade Equity Indexes and FX on a global scale, every 3-4 days on average.
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Note: The arrows in the graph may give one the impression that they are placed haphazardly but far from it! Unfortunately it is impossible to demonstrate here (TradingView) how this graph/indicator changes in time and space without the use of animation. Just imagine, as worldwide valuations change with time, "the tunnel's walls" twist and, at the same time, the principal axes expands or contracts simultaneously. (For the nerds out there; The whole construct becomes a strait forward Ricci Tensor projection and translation.)