QUESTION:
Martin,
I am a believer in your work and the effect of time and cycles complicit in everything.
My question to you relates to Socrates. If everyone followed the calls made by Socrates, wouldn’t this result in crowded trades and thus exacerbate volatility?
Appreciate all of your work,
IGP
ANSWER: We have just recently exceeded the 38 million view mark. Out of 7 billion, that is not very much. Human nature dictates the answer. Never in history will any idea reach 100%. The majority will never follow our model. It just would never happen.If everyone followed the model, nothing would change. Assuming society followed the model, we could then live with the business cycle and prepare for the downturns, etc. This would be like Joseph advising the Pharaoh. The net result would be to reduce the volatility, but not change the cycle which is at least in part incorporates nature.
Even disease moves in cycles and contagions. Light moves in cycles. The Economic Confidence Model has been tested back into ancient times. The frequency has always existed demonstrating that it is a natural cycle. What you need to understand is that very much like light, which moves in a electric-magnetic wave where the magnetic portion keeps the light bound in what appears to be a linear beam of light, the ECM functions in the same manner. It is the volatility which binds the business cycle preventing perpetual uptrends or downtrends. So the best we can do is influence the volatility to reduce the extremes, but we cannot alter the wave itself.
It was Marx who assumed he could eliminate the business cycle entirely by removing all personal wealth. All he did was hand it to government which is still just as corrupt as people assume the corporations and banks are. The common denominator is human nature. Only a fool would assume he can alter this cycle without changing human nature. To even do so would create what would be the equivalent of the White Earth Effect. If the Earth ever went to the extreme and became entirely covered in snow, the planet would reflect the sunlight and not absorb it and as such it would never be able to warm up again. This would be the same result if we were to eliminate the business cycle. Society would die.
