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The
Bob Prechter Admiration Society
by Robert B. Gordon,
Sc. D.
January 23, 2004
PREFACE
In announcing the formation of this new society, I am opening the door for others to express their appreciation for his wisdom and guidance over the years. In my more than two years of writing on the web, I have had enough deprecatory e-mails from readers who do not share my high opinion of Mr. Prechter. It is time for Bob’s supporters to stand up and join the new society.
Bob not only possesses the most brilliant mind that I have read in my later years, but his writings on complex subjects are clear and definitive. He has not been afraid to take a firm stand on controversial subjects. His call for a new bull market in the late1970’s and his 1995 call for an end to the bull market and a major world depression were bold and admirably correct. His 2002 book Conquer the Crash was both a warning for readers and a major aid for surviving the great bear market now in its very early stages.
I have read and admired many of his books and his thought-proving articles in his monthly Elliott Wave Theorist. In particular, I have enjoyed his latest thinking in the January 9 issue of the Theorist as it is a good example of Bob’s thoughts and writing at its very best.
ELLIOTT WAVE THEORIST
The title of the latest Theorist is: 2004 Outlook - A Major Reversal in Virtually Every Financial Trend. Here is the opening paragraph in its entirety:
"The entire financial world is traversing the cusp of epochal change. Not in our remaining lifetimes will we witness a conjunction of long-term trend-reversal indicators such as we have today. The very fact that huge consensuses around the world are betting one way in nearly every important financial market is indicative that a reversal in the monetary, financial and economic trends of many decades duration is underway. The implications are staggering, and I believe that the only paths to protection available are those spelled out painstakingly in Conquer the Crash."
RBG Comments:
Prechter’s 2002 Conquer the Crash is now available in a revised edition and is highly recommended to all my readers. The ten pages of the remarkably timely January 9 Theorist go on to give Prechter’s current reading on (1) The Monetary Trend, (2) The U.S. dollar, (3) The Stock Market, (4) The Economy, (5) Junk Bonds. (6) Oil, (7) Commodities, (8) Gold and Silver and (9) Real Estate.
An important part of this Theorist issue is devoted to Prechter’s analysis of the probable length of the current Wave 2 bear market rally. He arrives at an answer by comparing the ratio of the lengths of previous Waves 1 and 2 to the current situation. He also speculates on when the end of the first full down wave will occur in this bear market. It is still in the vicinity of 2011 as previously forecast in At the Crest. He also reiterates his previous estimate that the Grand Supercycle Wave IV (the current bear wave) will probably last for a full century.
I know of no other person on this planet who is capable of giving a current expert opinion on every phase of our financial and economic life. Is his record perfect? No, it is not, and when he has been wrong in the past, he has explained it and moved on. That is why I admire his honesty and integrity.
THE ELLIOTT WAVE BIG PICTURE
Many months ago, I wrote an essay comparing the inability of our current world to appreciate Elliott’s great new understanding of the stock market waves with the long delay for the world to accept the Copernicus discovery that the earth revolves around the sun. It took roughly a century as I recall for our world to agree that the earth does revolve around the sun. Here, in 2004, 70 years since Ralph Elliott published his Wave Principle, almost no one working in modern Economics understands that stock market crashes cause economic depressions. There is no evidence today, that Alan Greenspan or our leaders in Government and Wall Street have any understanding of the great tragedy about to strike the economy of the developed world.
According to Prechter’s way of looking at the world, the argument in favor of the Elliott Wave forecasts is greatly strengthened by the current worldwide consensus of contrary opinions. Here are his words describing the current disparity of views:
"To conclude, analysis indicates that the Kondratieff economic cycle, the bear market indicated by Elliott wave forms and the outlook presented in Conquer the Crash are all intact. It also shows that the financial events we expect are diametrically opposed to the expectations of as lopsidedly large a majority as financial markets generally permit. One cannot imagine a more contrary list of interconnected financial and economic opinions than those we at Elliott Wave International hold. The only reason we have had to fight to maintain these contrarian stances is the unprecedented slowness of the sea change that is developing .These markets could continue to hold up as long as through the first half of the year, but the ultimate resolution has been and remains virtually certain. This year should see financial changes that finally begin to reveal to the world what we already know is happening."
PRECHTER’S GENIUS
If Bob had chosen to work in almost any of the classical areas of the arts and sciences, he would by now, at mid life, be recognized by his peers as a genius in his field. He might have already won a Nobel prize if the award committee had been capable of understanding the significance of his work. But to my knowledge, looking from the outside, I do not see Bob as working for any prize. He is extremely busy studying old and new areas of knowledge. He is a brilliant writer of difficult subjects for laymen and experts. Extremely busy as he was at the time, Bob kindly proof read some of my early writing on the Elliott Wave Principle to correct any of my errors before publication.
Bob’s most important work to date has specialized in developing and improving the earlier work of Ralph Elliott and successors and writing a series of outstanding books on the Wave Principle. From this foundation he has launched a new field of scholarly endeavor known as Socionomics which hopefully will be developed and become an important branch of knowledge linking the stock market and social changes.
I hate to admit that, as I grow older, I am having difficulty comprehending some of Bobs writings. I am keeping up pretty well with his words on the stock market but when, some time back, he devoted pages of the Theorist to a radical break through in quantum mechanics, I dozed off. It must have had some great value but I failed to get it.
WHERE’S THE BEEF?
On the closing page of the January Theorist, Bob Prechter drew an important analogy between the current wave 2 in the Dow index and what happened in the live cattle market in late December. A consensus of news stories was very bullish on beef at the very time that the price of live cattle was rising in a strong wave 2 bear market rally (similar to our current Dow). But the bulls were surprised when wave 3 down dropped prices 22% in just 5 days. Prechter expects that the wave 3 coming in stocks will be just as dramatic on the downside and will start from a point of very bullish sentiment as now prevails.
I am proud to be a charter member of the Bob Prechter Admiration Society and will be happy to enroll others who may wish to join. Membership is free.
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© 2004 Robert B. Gordon, Sc.
D.
Dr,
Gordon's Editorial Archive
Robert
B. Gordon, Sc. D.
Sun City West, Arizona
January 23, 2004
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