Zoran forwarded an ominous analysis from the Safehaven Longwaves Forum that the money aggregate M3 has been collapsing to an unprecedented degree, as shown in this chart. In addition, Prechter has recently been interviewed on the coming collapse of the money supply and its implications. In his view, the Fed has run out of ammunition to stop deflation, and indeed may have worsened it by continuing to extend credit in the greatest credit bubble of all time (according to Prechter). With no magic inflationary viagra pill, the Fed is now impotent to prevent a downward spiral.
We have been here before with Prechter. He began prophesizing this inevitability as far back as 1995, and like Cassandra, his message of doom and gloom has lost force in its repetition without denouement. Facts are hard to dismiss, however, and the collapse of M3 needs to be understood.
"He began prophesizing this inevitability as far back as 1995..."
I have old copies of "A Turn of the Tidal Wave" from 1989, and I'm pretty sure Rukeyser nailed Prechter for being a perma-bear in the early '90s.
Not meant to nitpick, because the point about M3 is so sound (as evidenced by the pooh-poohs emanating from Wall Street).
It's important for us all to remember that Prechter turned his back on a 10+ year bull market. Whether he applied a good theory badly or brilliantly interpreted a rotten notion, Prechter helped fatally wound EWT.
Posted by: Prechter Watcher | Monday, December 08, 2003 at 06:14 AM
Good comment. I have followed Prechter since the mid-80s, but first read the "Tidal Wave" book in the edition published in '95.
Posted by: dd | Tuesday, December 09, 2003 at 05:03 PM
Prechter will be wrong again, as he always is.
Prechter doesn't even trade or risk his own money in the markets, he is a bookseller and newsletter hustler.
Wouldn't you want to listen to someone who actually risks money? Or Prechter who has nothing to lose, but gets more suckers to buy his newsletters.
I admire Prechters social commentary, but dont use Prechter for making money.
Prechter also ignores his own research. Several key MAJOR long-term Social buy indicators ocurred at Dow 7700 and Nasdaq 1300.
While Prechter is waiting for Dow 600. I'll see you guys at Dow 36,000 in 10-15 years.
Posted by: J.D. | Thursday, December 11, 2003 at 09:05 AM
this is all so true...
Posted by: Jesse | Tuesday, December 14, 2004 at 10:10 PM