Thoughts from the Frontline

If you get beyond the political rhetoric [and assembled a group to solve Social Security] it would take them 15 minutes. It would take them 15 minutes only because 10 minutes was used for pleasantries. —Alan Greenspan, Speech to the Commercial Finance Association on October 26, 2006

Exploring federal budget data is a journey through endless rabbit holes, some of which are eerily close to Alice in Wonderland insanity. Countless variables interact in unexpected ways. Seemingly small changes can cascade into billions of dollars within a few years.

Identifying problems is great. Identifying solutions is even better, especially when the politicians who are supposed to be solving our big problems don’t even try.

The ancient Greeks had a word κάθαρσις, which in English we now spell as “catharsis,” although it’s pronounced basically the same. It originally referred to purifying religious ceremonies, medical treatments, and so on.

We have been looking at big historical/economic/political cycles for the past two months. We reviewed Neil Howe’s Fourth Turning concept, then George Friedman’s twin US institutional and socioeconomic cycles, then Peter Turchin’s “cliodynamics” concept, and then Ray Dalio’s Big Cycle.

When your system, whatever it may be, is working extremely well, we used to say it’s “firing on all 8 cylinders.” What does that mean?

“…what I learned is whatever successes I had in life had to do more with how I dealt with what I didn’t know than what I know…

Intermission is over. Today we resume my series on the global cycle theories that, probably not by coincidence, all point to major change unfolding in the next few years. Finishing it may take some time since I keep finding new material.

Last week we began exploring the details of my personal portfolio. This week we will finish and then move back to our discussion of various cycles. You might want to read the first part of this letter if you missed it.

I am now in my 24th year of writing Thoughts from the Frontline. I started in early 2000 with 2,000 readers from a previous newsletter project and had no idea it would become as popular as it has. I want to thank all of my longtime readers and welcome the new ones! You are what keeps me writing and energetic!

Greetings from Europe. I promised to write a letter describing my personal investment portfolio. I still plan to, but it won’t be this week. Shane and I are having a wonderful trip—a much-needed break for both of us.

Look up the word “cycle” in a dictionary, and you’ll find something like this: “A regularly recurring sequence of events.” Sounds simple, but that definition leaves a lot of ambiguity.