Despite recent volatility we remain very bullish. Markets are forward-looking and volatile because of the upcoming elections. Investing and society are guided by cycles. Knowledge of investing cycles can be profitable; and knowledge of society's cycles can be comforting in our Crisis Era. The United States enters a two-decade Crisis Era approximately once every lifetime. We are at the climax of a Crisis Era that began with the Financial Crisis of 2008. The United States of 2026 will look very different from the United States of 2020; but by 2026 the United States will enter into a new high of harmony and prosperity. Spring is next.
Neil Howe and William Strauss predicted in 1992 that a once-in-a-lifetime “Crisis era…will climax around 2020” with ”the resolution around 2026” (in their book The Fourth Turning). Mr. Howe is a demographer (someone who studies generations) credited with coining the term 'Millennial.' His research in demographic cycles incrementally improved our investing model; his insights into society's cycles help us understand the present turmoil in the United States.
Howe and Strauss note that American crises occur on a regular basis:
The time in-between each Crisis Era is approximately 80 years or the length of a human lifespan. Howe and Strauss label this span a saeculum (an ancient term meaning 'lifespan'). Each saeculum consists of four seasons or what the authors call turnings. Each turning (season) lasts about two decades and is characterized by a change in how people “feel about themselves, the culture, the nation, and the future.” Here are the Four Turnings:
Turning | Description | Season | Example |
First | High | Spring | post-WWII |
Second | Awakening | Summer | Conscious Revolution from mid-1960s to early 1980s |
Third | Unravelling | Autumn | Culture Wars mid-1980’s to the Financial Crisis 2008 |
Fourth | Crisis | Winter | Financial Crisis 2008 to 2026? |
Investing and society are guided by cycles. American society cycles through four seasons (turnings) collectively lasting a human lifetime. We are in a once-in-a-lifetime blizzard. But Spring is next.
| Updated 9/1/2020 | Gabriel Private Alpha Fund (after fees) | SP-500 (SP-500 ETF SPY) | Eurekahedge 50 (50 largest hedge funds) Index | AI (Artificial Intelligence) Hedge Fund Index | Barclay Hedge Fund Index | Hedge Fund Index |
| Cumulative Return since Inception of GPA Fund (January 2020) | 22.0% | 3.5% | -2.6% | 4.8% | 1.3% | 4.7% |
| Value of $10 Million investment | $ 12,203,659 | $ 10,350,807 | $ 9,739,583 | $ 10,481,928 | $ 10,134,000 | $ 10,472,279 |
This report reflects the current opinion of the author. The report is based upon sources believed to be accurate and reliable. Opinions and statements about the future expressed in the report are subject to change without notice. The report is not a solicitation or an offer to buy or sell any security.
