Pre-Conditions For a Crackup Boom are Building

By: Gordon Long | Sat, Nov 9, 2013
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Why Stock markets Crash by Didier Sornette

We did an extensive amount of work on Chaos Theory a few years ago and duirng that period became familiar with Professor Didier Sornette, a lowly French trained associate professor at UCLA, in the image fellow mathematician Benoit Madelbrot (the father of Chaos Theory).

What attracted me to his work was his mathematical use of power series to isolate patterns and predictions from what are perceived to be highly complex and non predictable events.

These events at the time included such events as earthquakes but the financial market were quickly becoming a center of his interest, again similar to Benoit Mandelbrot who postulated from the cotton markets that there was a random generator for the markets that would allow predictability.

Both were studying Complex Systems and could see repeatable "fractals" within the apparent Chaos that when taken as a whole defined surpizingly precisely the situation. A lot of this mathematics has been applied today in graphic animation to generate complex images for entertainment.

Didier Sornette

I raise this discussion because Professor Sornette (now a full Professor at the prestigious Zurich Federal Institute of Technology) has published the following chart which I find both fascinating and highly correlated with our research.

I present it below without comment for your consideration and study.

After having introduced the subject in last month's TRIGGER$ (also see below) I cite further evidence in this month's upcoming MATA release as part of the Studies section on the evolving "Crack-up Boom".

Anatomy of a Text Book Pre-Crash Bubble

I recommend the following video for further insights.

 


Crackup Boom

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Gordon Long

Author: Gordon Long

Gordon T. Long
Publisher - LONGWave

Gordon T. Long

Gordon T. Long has been publically offering his financial and economic writing since 2010, following a career internationally in technology, senior management & investment finance. He brings a unique perspective to macroeconomic analysis because of his broad background, which is not typically found or available to the public.

Mr. Long was a senior group executive with IBM and Motorola for over 20 years. Earlier in his career he was involved in Sales, Marketing & Service of computing and network communications solutions across an extensive array of industries. He subsequently held senior positions, which included: VP & General Manager, Four Phase (Canada); Vice President Operations, Motorola (MISL - Canada); Vice President Engineering & Officer, Motorola (Codex - USA).

After a career with Fortune 500 corporations, he became a senior officer of Cambex, a highly successful high tech start-up and public company (Nasdaq: CBEX), where he spearheaded global expansion as Executive VP & General Manager.

In 1995, he founded the LCM Groupe in Paris, France to specialize in the rapidly emerging Internet Venture Capital and Private Equity industry. A focus in the technology research field of Chaos Theory and Mandelbrot Generators lead in the early 2000's to the development of advanced Technical Analysis and Market Analytics platforms. The LCM Groupe is a recognized source for the most advanced technical analysis techniques employed in market trading pattern recognition.

Mr. Long presently resides in Boston, Massachusetts, continuing the expansion of the LCM Groupe's International Private Equity opportunities in addition to their core financial market trading platforms expertise. GordonTLong.com is a wholly owned operating unit of the LCM Groupe.

Gordon T. Long is a graduate Engineer, University of Waterloo (Canada) in Thermodynamics-Fluid Mechanics (Aerodynamics). On graduation from an intensive 5 year specialized Co-operative Engineering program he pursued graduate business studies at the prestigious Ivy Business School, University of Western Ontario (Canada) on a Northern & Central Gas Corporation Scholarship. He was subsequently selected to attend advanced one year training with the IBM Corporation in New York prior to starting his career with IBM.

Gordon T Long is not a registered advisor and does not give investment advice. His comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to buy or sell a stock, option, future, bond, commodity or any other financial instrument at any time. While he believes his statements to be true, they always depend on the reliability of his own credible sources. Of course, he recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, before making any investment decisions, and barring that, we encourage you confirm the facts on your own before making important investment commitments.

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