Long term predictions

While trend following is good for mid-term investment, fundamental analysis enables some long-term predictions.
1. The power of demographics. Young people generate inflation and growth, aging population is causing deflation and stagnation. By following nations’ demographic it is possible to predict roughly the long term growth trajectory.
2. Diffusion. In healthy economy there is diffusion of oil products, basic metals etc from raw form into more refined forms. If the refinement slows down, this is an indicator of coming risk.
3. Sypercycles. The economy is cyclic and returns to very long-term trend from time to time. This cyclic nature is disrupted by various innovations, so it cannot be fully trusted.
4. Skyscraper indicator raises concerns regarding China’s economy.
5. Composite leading indicators suck as this show some slowdown
While each of these signs may be interesting, they apply in long term and may wait for years before generating market correction…

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