High Inflation: We are in Kondratieff's "Summer of Summer" | Ahmed Farghaly

Many people are wondering what has been happening to the prices of gold and silver recently. We were expecting developments similar to those that occurred after the 2020 bottom of the Kuznets wave [aka the 18-Year Cycle] in global markets. The first chart below presents our cyclical analysis of the Commodity Price Index.

 

 » We are in the “summer of summer.” «

 Commodity Price Index (quarterly bars, log scale) from 1750 to 2025: 162-Year, 54-Year, 18-Year, and 9-Year cycles. 

[Note, there is ongoing debate regarding the precise starting points of the 162-year and 54-year cycles.
It can be argued that both should be anchored to the Great Depression low of 1932, rather than to 1949-50.]

It is evident that the 54-Year Kondratieff wave, first identified by Nikolai Kondratieff, is clearly reflected in this historical chart. Even more intriguing is the apparent presence of a 162-Year larger-degree Kondratieff wave that maintains the same 3:1 harmonic relationship to the Kondratieff wave as the Kondratieff wave does to its smaller counterpart, the 18-Year Kuznets wave. In our cyclical model, the cycle spanning three Kondratieff Waves is called the Hegemony wave.
 

972-Year Methuselah Wave = three 324-Year Enoch Waves

Enoch Wave = two 162-Year Hegemony Waves 

Hegemony Wave (156.88 y) = three 54-Year Kondratieff Waves

Kondratieff Wave (52.72 y) = three 18-Year Kuznets Waves

Kuznets Wave 17.52 y) = two 9-Year Juglar Waves 

Juglar Wave (8.76 y) = two 54-Month Kitchin Cycles 

Kitchin Cycle = three 18-Month cycles = six 40-Week cycles

Many economists have described the “seasons” of the Kondratieff wave—spring (stable growth), summer (high inflation), autumn (low inflation and asset bubbles), and winter (deflationary recession). Typically, spring coincides with the first Kuznets cycle, summer with the second, and autumn and winter with the third. The highest inflation rates within a Kondratieff wave occur during the summer phase, corresponding to the second Kuznets cycle, which began in 2020.

 

» To every thing there is a season, and a time to every purpose under the heaven. «
Ecclesiastes 3:1.

We are currently in the second Kuznets cycle (2020 to late 2030ies) of the second Kondratieff cycle (2000 to 2050) within the ongoing Hegemony wave (1950 to 2100)—a phase that can be described as the “summer of summer.” This phase suggests that we are likely to experience the highest inflation levels since the American Civil War (1861–1865).

» We are likely to experience the highest inflation levels since the American Civil War. «

US Inflation: Annual Percentage Change from 1774 to 2007, with Outlook Extending to 2106.

  

Our next chart above illustrates annual inflation in the United States since 1777. A distinct 162-Year Hegemony wave pattern emerges, with an inflation peak in 1813 marking the summer of the first Kondratieff cycle, a higher peak in 1865 corresponding to the summer of the second Kondratieff cycle, and a lower peak during World War I representing the summer of the third Kondratieff cycle. A comparable peak reappeared in 1980. According to our cyclical outlook, inflation in the current Kondratieff cycle is expected to surpass the levels of the 1970s, as this phase represents the second Kondratieff cycle within the broader Hegemony wave—the “summer season.”

The most advantageous assets to hold at this stage of the cycle—both from the standpoint of the Hegemony wave and the Kondratieff summer—are precious metals, real estate, and equities that tend to benefit from periods of high inflation.

Quoted from:
Ahmed Farghaly (October 6, 2025) - High Inflation: We are in Kondratieff's "Summer of Summer". 

 

 The Ultimate Summer:

972-Year, 324-Year, and 162-Year cycles.

» We are in the Sixth Wave that peaks
on Sunday, December 12, 2032. «

 

» Yet, what experience and history teach us is this: that nations and governments have never
learned anything from history, nor acted in accordance with the lessons to be derived from it. «
Georg Wilhelm Friedrich Hegel, Introduction to Lectures on the Philosophy of History, Berlin, 1822.

 

See also:

Ahmed Farghaly (2016) - The 162-Year Cycle in Stocks and Commodities Since 1509.

DJIA vs 18 Year Cycle | Cyclic Vibrations

Ahmed Farghaly (Nov 16, 2016) - The peak of the 18 year cycle should be
expected sometimes in late January early February 2017 (see also HERE)

Share Prices from 1509 to 2016 | Tide in the Affairs of Men

There is a tide in the affairs of men.
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat,
And we must take the current when it serves,
Or lose our ventures.

William Shakespeare | Julius Caesar: Act 4, Scene 3, 218 – 224.

High Resolution *.pdf HERE | Source: HERE

Financial Crisis and Market Panics | From 1500 to the Present

Source: @Stock_Trend_Chg

German DAX: Gloom, Boom and Doom | Cyclic Vibrations

Ahmed Farghaly (Oct 02, 2016) - There is no question in most commentator's minds that the growth in Germany has certainly slowed relative to what this great country has enjoyed in the 20th century […] The reason for my post about Germany is because the first domino to fall in the upcoming financial calamity seems to be Deutsche Bank […] The upcoming calamity is not going to be like 2008 which was merely a correction of the 18 year cycle. The decline is likely […] of the 324 year cycle and will make 2008 seem like a tiny little hick up within the unraveling of a much larger cycle correction.

[…] The German DAX is likely to not only decline but have an outright collapse of a magnitude not witnessed in our lives. The S&P/DAX ratio is in favor of the S&P which suggests that we are likely to see a larger decline in Germany. 

German Stocks In Trend Limbo
Source: Dana Lyons' Tumblr.

The 162-Year Cycle in Stocks and Commodities Since 1509 | Ahmed Farghaly

The chart below begins at the millennial low of 1555, followed by a remarkable sequence. I first discovered the 162-year cycle by drawing a trendline between two consecutive lows of the 54-year cycle—specifically, the lows of 1842 and 1896. A break in such a trendline suggests that a larger cycle has turned, and indeed, the trendline was broken during the 1929–1932 crash. 

  

Stock Prices from 1509 to 2013, and 162-Year cycles into 2094.

 

This provided an early indication of the 162-year cycle’s presence. I identified it as a 162-year cycle because the first 54-year cycle used to draw the trendline marked a rally following a bear market that lasted 64 years, making it an ideal starting point. I then confirmed this hypothesis by examining wheat prices and, later, commodity prices, which led me to conclude that the existence of the 162-year cycle is no longer a hypothesis but a fact.

 

 The combined chart offers further evidence of this cycle’s presence. Notice how neatly the first 324-year cycle subdivides into two 162-year cycles, with the trough of the 162-year cycle occurring precisely in the middle of the 324-year cycle. 

 

Upon closer inspection, both 162-year cycles subdivide into three 54-year cycles, reinforcing the conclusion that the Kondratieff wave is the third harmonic of the 162-year cycle. After the trough in 1784, three 54-year cycles followed, ending with the crash of the late 1920s, which marked the trough of the 162-year cycle. 

 

What followed was the greatest bull market in modern history—and it is unfortunate that we are nearing its end. The peak of the last 324-year cycle occurred in the third 18-year cycle of the second 54-year cycle of the second 162-year cycle, which is where we find ourselves today. The likelihood of further translation beyond the previous 324-year cycle is slim, given that the influence of the 972-year cycle has leveled out since the 1930s.

The Elliott Wave structure is also quite interesting. What stands out on the chart is the fact that the entire advance since 1784 featured a fifth-wave extension. Even more intriguing is that the move from 1932 also included a fifth-wave extension. According to wave theory, fifth-wave extensions are typically followed by crashes. Commodities offer excellent examples of this phenomenon, as their dramatic declines often result from a fifth-wave extension.

 

Quoted from:
Ahmed Farghaly (2016) - The 162-Year Cycle in Stocks and Commodities Since 1509.