Wall Street Banks Warn Downturn Is Coming
The pattern of boom&#x2F;bust cycles over the past century is alarmingly consistent, especially for a field like economics that is famously unpredictable. Just look at the graph in Exhibit 7 of this article. It&#x27;s almost perfectly periodic. According to investopedia [0], &quot;there have been 11 business cycles from 1945 to 2009, with the average length of a cycle lasting about 69 months, or a little less than six years.&quot; By this logic, we&#x27;re definitely &quot;due&quot; for a downturn very soon.<p>Does anyone who understands finance have any insight on why this pattern seems so predictable? Is it due to fundamental economic drivers, or is it merely correlated with major historical events (internet 2000s, globalization 1990s, deregulation 1980s, post-WW2 society 1950s, etc)?<p>If technological society does not continue to innovate at the pace of the last few decades, will boom&#x2F;busts smooth out at a point of slower growth?<p>[0] <a href="http:&#x2F;&#x2F;www.investopedia.com&#x2F;terms&#x2F;b&#x2F;businesscycle.asp" rel="nofollow">http:&#x2F;&#x2F;www.investopedia.com&#x2F;terms&#x2F;b&#x2F;businesscycle.asp</a>