Comments on: Elliott Wave Disciple Robert Prechter Sees a Possible 2,000 Dow

By: Steven Yoder

Steven Yoder — Thu, 25 Feb 2010 19:59:19 +0000

We give China—exactly what we should—–washington D.C.; federal -owned lands, public buildings, and war equipment—–don’t they deserve their money back. If you owed a bank—-they would take our assets—–at completely depressed prices!!!! Oh well, this is what we deserve for never doubting our elected officials.

By: Yesterday's Sept. 1 Downer For Stocks Darkens the Outlook in an Already Bleak Month For Investors

Wed, 02 Sep 2009 14:13:43 +0000

[...] (Prechter was recently interviewed by Money Morning Contributing Editor Martin Hutchinson. To read that report, please click here.) [...]

By: Robert

Robert — Fri, 03 Jul 2009 05:42:13 +0000

I am saying that I agree with Robert Prechter that we are on the verge of seeing a massive DEflation, with a major wipeout of credit, and am preparing accordingly. We might see inflation start up AFTER deflation has made itself obvious to all. But barring the Bureau of Engraving starting up the actual printing presses to print actual currency, that won’t happen until people are on balance in the mood to ask for credit to start buying things once again. Estimates from Elliot Wave that I have read predict that to still be years away. More likely the government at some point is not going to have the money to honor its existing programs and start defaulting on them. But you can bet the government will make darn sure to honor its Treasury securities as a matter of its own survival.

My best guess for when the big drop written about should begin would be sometime in the late summer or in the fall. During that wave, we should see what Ellioticians call the “point of recognition”. That’s when the public will recognize unmistakably that the dominant trend has changed. And there’s an extra nasty with the current wave of what they call cycle degree – the breakout of war near its low. I think a couple possibilities for whom the enemy might be in such a war have become obvious in Iran and North Korea. It occurred to me recently there could be another possibility – civil war if the Obama administration crosses some red line such as trying to disarm the populace, which tens of millions would undoubtedly recognize as the administration putting itself in a state of war against the people. In light of the strong likelihood of some kind of major war, having some retreat to go to, away from other people, would be wise.

One last thing on 1987 – in the 1978 edition of Elliot Wave Principle, Bob Prechter predicted that 1987 would be a likely year for the cycle wave V bull market he was predicting to end, based on Elliot Wave guidelines on waves 1 and 5 tending toward equality. Guidelines, unlike rules, may or may not play out as predicted, and in this case that guideline did not. It turned out that the bull market he predicted lasted quite a bit longer than originally forecast, more closely rivaling cycle wave III than wave I in terms of time and magnitude, and the wave structure was not yet complete in 1987, and therefore the wave of social mood the stock market reflected was not yet over.

By: Mitchell

Mitchell — Wed, 17 Jun 2009 18:13:24 +0000

@john 87 was temporary, look it up. Try wikipedia.

A 2000 dow would prove to everyone I’ve been talking to that I am right. And it will happen soon!

By: john

john — Sun, 24 May 2009 23:21:22 +0000

This article is misleading. After the 87 crash, Prechter turned
perma bear. He didn’t view the 87 crash as a temporary setback. If he turned bearish in the late 90’s it was only after missing the entire move from 4000 to 10000.

By: John R.

John R. — Sun, 24 May 2009 17:35:12 +0000

Very interesting comments

By: Ron

Ron — Sun, 24 May 2009 15:17:10 +0000

Robert are you saying that due to the government programs we are entering a time of inflation?

By: Martin

Martin — Sun, 24 May 2009 14:03:29 +0000

Thanks for the article, and also to Robert (no.9) – could be Prechter himself talking, and I think he’s right. (Fewer thanks to Richard B., who needs to know that the Pope only represents one wing of one religion, a religion that is not at all against birth control, as the Greek Orthodox Church, Anglicans and others will confirm to him). But I write because Martin Hutchinson’s article contains one massive unlikelihood: ‘Maybe we can combine our views, and agree that the deflation will be of the dollar’s value, so that prices will inflate in dollar terms, but deflate in such other hard currencies as the euro, the renminbi (China’s yuan), or the Brazilian real’. I doubt that Prechter or many others could ally themselves with that, but as you say, ‘we’ll see’.

By: mike

mike — Sun, 24 May 2009 13:05:08 +0000

If you are trying to attracted business and you think you would like to attracted the people with money (baby boomer’s). Take a look at baby boomer’s next time you are out and about, you might notice that they are wearing glasses, that means they cannot see as well as they would like too, so why are you using a small font and why are you using a hard to see color, sorry just a question, but it also lets me know how smart you are!

By: Robert

Robert — Fri, 22 May 2009 03:19:52 +0000

Having read Prechter’s Conquer the Crash, I think I understand the Elliot Waves and inflation/deflation pretty well now. In Chapter 9, Prechter makes the distinction between currency inflation and credit inflation. If the government were really printing money at the Bureau of Engraving, that would be currency inflation, which can go on indefinitely, and was the kind the Weimar Republic got from a desperate government that was broke and deeply in debt. But in the U.S. we have seen credit inflation. Bank deposits are created out of thin air when a willing borrower borrows money. That creation of deposits inflates the “money” supply. But credit is different from money. It is access to money, rather than money itself. Debt creation has acted like money creation since the 1930’s. Debt destruction, such as when a borrower defaults on a loan, destroys the extended credit. When that happens, the credit that acts like money disappears back into thin air. We have entered a time when the social mood behind Elliott Waves has turned toward conservation rather than expansion. To put it another way, people are not in the mood to borrow and go into debt. That means willing borrowers are fewer are farther between while debt defaults, especially on overpriced real estate, are accelerating. That means credit is being destroyed faster than it can be created, which is what happens in deflation. I recall reading within the last year that there is somewhere in the neighborhood of $64 billion in currency, and about $52 trillion in credit in the “money” supply. If most of that credit gets destroyed, we will see a massive contraction in money supply, and existing cash will buy much more. If all but $1 trillion of that credit were to be destroyed, for example, surviving dollars would buy about 50 times as much. If that credit contracts to just $100 billion, we could expect cash to buy about 500 times as much as it does today. And similarly, those in debt would owe roughly 500 times as much in real terms. Social mood is composed of people with minds of their own, herding as their way of coping with uncertainty. And until social mood turns up to favor expansion again, the only way we will get inflation is if the government actually turns on the actual printing presses at the Bureau of Engraving and prints actual currency. The government knows if they do that, however, that would be tantamount to government default, and they will not be able to borrow another dime without paying very high interest, and will then be forced to pay for all government spending with actual tax revenue, and will be strictly limited by taxes it can collect.