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Interview on the Property Geek Podcast

Posted by on Mar 7, 2015 in 18 year real estate cycle, Interviews |

I recently appeared on the Property Geek podcast to discuss my research on the 18 year cycle and the real estate outlook for the UK. Property Geek is run by Rob Dix – I came to Rob’s attention when he read the article I wrote in MoneyWeek last year on the 18 year cycle. (You can find a copy of the article here). Rob has produced some excellent material to assist people to take the plunge into the world of property investing. So he was pretty pleased to come across an article which set out how the cycle works and how you can use it to forecast, years in advance, when the market is going to peak, fall and recover. He asked me excellent questions about the cycle which made for a good interview (even if I do say so myself!). During our discussion we talked about the 18 year cycle and why it continues to operate; where we are in it currently and what the outlook is for London and the UK over the next decade. We also discussed some ideas on how you can use the knowledge of the cycle to improve your investment decision-making. You can hear the interview by following this link: – http://www.propertygeek.net/18-year-property-cycle-akhil-patel/...

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If the Pound stays above 1.59 vs. the Dollar the Union is preserved

Posted by on Sep 10, 2014 in Forecasts |

The financial press over the last two days have been worried about the dramatic sell off in Sterling ever since the polls published over the weekend suggested that more people would vote for Scottish independence on 18th September. In truth, the sell-off has taken place in the context of a downtrend following the pound reaching a six-year high against the dollar in July (see the chart below). However, the dramatic nature of the sell off is being interpreted as the markets finally waking up to the possibility of the Union breaking up. Earlier this year, the pro-Unionists had a seemingly massive lead but this has been steadily eroded over time. And now it seems the momentum is with the nationalists. GBP sells off dramatically on the possibility of independence   To anticipate what is going to happen, I look to what the markets are telling me. I learned this from legendary trader, W.D. Gann, in his 1923 book The Truth of the Stock Tape. Gann was not the first market expert to point out that markets seemingly anticipate what is going to happen – the stock tape speaks the truth – nor will he be the last. The trick, as ever, is in understanding how to read the stock tape. Over my summer holidays, I read an excellent book called War, Wealth and Wisdom by investment guru Barton Biggs. This excellent book – which I highly recommend – demonstrates quite clearly that despite the public news and perception of what was happening during the Second World War, the markets tended to be ahead of events. For example, Biggs points out that London Stock Exchange made its low “for all time” in the summer of 1940 just before the Battle of Britain – despite the fact that Britain’s fortunes in the war got worse during the late 1940s and 1941 (in Europe – things got worse in the Asian theatre of war for a lot longer). Somehow, the markets foresaw that Britain would survive the Battle of Britain and that the US would be drawn into the war – a pivotal moment that helped turn the war. Similarly, the high point for the German stock market was at the time that the advance units of the German Army were approaching Moscow, in December 1941. This was a moment in the war when the Wehrmacht was seen to be unstoppable – but the markets knew better. Gann was quite clear that to understand what is going on you should look at charts of the market or stocks. When the market makes higher lows on bad news, this is a sign that things are going to get better. Ascendant Strategy uses this...

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Four Cycles to help Investors and Traders

Posted by on Aug 13, 2014 in 18 year real estate cycle, Kondratieff (Long) wave cycle, Reports |

We have just launched our latest report: Four Cycles to help Investors and Traders. In this 27 page report, we provide you with a detailed look at four key investor cycles that shape the long-term direction of global markets. You can apply this ‘big picture’ knowledge to your own investment decisions. We are firmly of the view that the best long-term investments follow the major secular market trends. This report will take you through those. In the report, we tell you: why in 2012, when there were still significant eurozone worries and US deficit issues, we knew that stock markets would have a bull year and why we are looking for a market low in the next six months why we don’t think that Western governments’ money printing will lead to major inflationary issues why we we live in an era of low interest rates why the coming boom will be the biggest of all time The four cycles we cover in the report are: Investor Cycle #1: The US Presidential Cycle Investor Cycle #2: The 18.6 year Real Estate Cycle Investor Cycle #3: The Kondratieff Wave (50-60 year commodity cycle) Investor Cycle #4: The Great Wave (the 100 year inflationary revolution and equilibrium) Any investors with a long-term investment horizon will benefit from the insights contained in this report.  For details on how to obtain this report, please visit our Reports...

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Ascendant Strategy writes the cover story for MoneyWeek

Posted by on Jun 8, 2014 in 18 year real estate cycle, Articles, Forecasts |

Ascendant Strategy was invited to write the cover story for this week’s edition of MoneyWeek (out on 6th June 2014).  In this article we make some bold predictions for how the the cycle is going to unfold into 2026/27.  This based on our unique research on economic cycles.  In the article we: provide a forecast of how the main 18-20 year economic cycle will unfold in Western economies into 2026/27 date the start of the nexr recession (the mid-cycle recession) and the one after that (the final major recession/financial crisis) explain why we are confident the cycle will repeat consider briefly the role of land and real estate speculation in driving the economic cycle forward set out key dates to watch for stock markets, commodities, bonds and real estate. Most important of all, we emphasise again our analysis this cycle will involve the biggest boom of all time. In the article we describe two of the tools that we have developed to assist investors with understanding where we are in the cycle and what is likely to happen next.  First of all is the 18 year real estate clock:   (copyright Economic Indicator Services Ltd. 2005) Since the cycle is ultimately driven by speculation in real estate (land) understanding what is happening the in property market is critical to our economic framework. The second tool is the Economic Cycle Lead Indicator, set out in the diagram below, which provides advance warning of the peak of the cycle.  The indicator exceeds and remains above a value of 1 when we reach the mature stages of the boom, which is the time to exercise caution (unlike everyone else); the indicator falls prior to the associated recession and stock market high.   Its current value of 0.9, just above the lowest value of 0.85, is further confirmation that there is plenty of upside to go before this cycle is over. (copyright Ascendant Strategy and Investments Ltd. 2014)   For further information on how we can help you make better investment decisions, please get in touch. A copy of the full article can be obtained...

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How to play the economic cycle

Posted by on Jun 5, 2014 in 18 year real estate cycle, About Ascendant Strategy, Topical news |

This post shows how you, as an investor, can profit from understanding the 18-20 year economic cycle.  This insight on cycles is something that only Ascendant Strategy can teach you. At cyclical peaks… The news about emerging markets in recent months points to the fact that many of them are at or are approaching their respective cyclical peaks, in the way that Western economies were between 2006-2008.  As the stylised diagram below shows, once an economy reaches its 18 year cyclical peak, it will then experience up to four years of economic difficulties.  This happens cycle after cycle, without fail. The question is: what should investors do at such times? The final years of the up-swing of a cycle involves a (credit-fuelled) spending binge during which asset prices, which have risen through the cycle, accelerate sharply and consumption increases conspicuously.  This was the case in western economies in the middle of the last decade and is now true of many emerging economies.  Such trends have been aided by ultra-low interest rates in the recovering West, global capital hunting for yield, lavish government spending on public works, high optimism after a decade (or more) of strong growth and so on. Into cyclical peaks, the business case for investments looks strong, as they are based on good economic fundamentals, continued growth (projecting the recent past into the future), high demand, availability of credit and so on.  Such conditions bring a lot of investors to the party and so there will be lots of competition to acquire assets. When the going is good, exercise caution. Investments must be good value, based on robust fundamentals, current earnings (not capital gains, i.e. future earnings growth) and not dependent on rolling over loans.  We call the final two years before the cyclical peak the “Winner’s Curse”.    You may make some investments that realise gains for a couple of years but when the cycle turns down you may soon find you are holding assets worth less than what you paid for them. How the savvy investor plays the cycle We advise not following the herd.  Be patient and don’t be fearful of missing out.  Examine your portfolio and make sure its value is protected.  The last couple of years into cyclical peaks – when things are overheating – is a good time to dispose of the weaker elements of your portfolio.  It also helps to be in safe and liquid assets. As the cycle turns down, there will be plenty of investors that are over-leveraged and in need of cash.  This is the time when good assets are available at good value.  Furthermore, in a downturn there will be fewer investors, so less competition to bid...

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