THE financial world seems to be obsessed with the short term. Fund managers are usually judged on their performance over a three-month period. The television news highlights daily moves in stockmarkets. Lots of hedge funds think in terms of milliseconds.
But some commentators take the opposite tack, arguing that history is subject to “long waves” that cause economies and markets to change direction at regular intervals. Roger Babson, an investment adviser who predicted the 1929 crash, claimed the markets were driven by Newton’s third law of motion: every action has an equal and opposite reaction. Mind you, he also wrote a pamphlet entitled “Gravity—Our Number One Enemy”
But some commentators take the opposite tack, arguing that history is subject to “long waves” that cause economies and markets to change direction at regular intervals. Roger Babson, an investment adviser who predicted the 1929 crash, claimed the markets were driven by Newton’s third law of motion: every action has an equal and opposite reaction. Mind you, he also wrote a pamphlet entitled “Gravity—Our Number One Enemy”
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