Kondratieff is perhaps the best known economic cycles researcher, having given his name to a cycle of around 54 years in prices and interest rates. The following graph, taken from “Cycles” magazine in August 1980, shows Kondratieff’s interest rate chart from 1820 to nearly 1920. The ideal cycle of 54 years was added by Dewey as Kondratieff had simply stated that the cycle varied from 48 to 60 years.
The graph identifies troughs in interest rates at 1843 and 1897. By continuing to add intervals of 54 years, we can expect further lows to occur around 1951 and 2005. Highs are expected in 1924 and 1998.
Since 1920 we have passed through another one and a half cycles, showing perhaps two more each of highs and lows, so it is possible to see how Kondratieff’s dates turned out. The data used here is from the Data for Figure 2.1 in Robert J. Shiller Irrational Exuberance 2nd. Edition Princeton University Press.
The continued Kondratieff cycle is very clear. The dates are a little different because the cycle is not perfectly regular.
The most important thing is that we are now 6 years past the expected low in interest rates. Therefore we can expect interest rates to rise for the next 27 years almost.