Economic Confidence Model

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The Economic Confidence Model is an economic cycle theory by Martin A. Armstrong. Armstrong proposes that economic waves occur every 8.6 years, or 3141 days, which approximately Pi X 1000. At the end of each cycle is a crisis after which the economic climate improves until the next 8.6 year crisis point. The model has been profiled in The New Yorker, Time magazine, Financial Times and Barrons[1] due to what appeared to be accurate predictions.


Armstrong's theory was first applied in 1977, when he used it to successfully predict an upturn in the price of commodities.[2] The theory is based on a list of historical financial panics (26 in 224 years, between 1683 and 1907), producing a frequency of roughly 8.6 years.[2] Armstrong concluded that a wave of 8.6 years moved through larger waves building in intensity amounting to six waves of 8.6 years constructing a major long wave of 51.6 years.[2] Also key are quarter-cycles of 2.15 years.[1]

Armstrong's cycle was called the "secret cycle" by the New Yorker.[2] In Time magazine, Justin Fox wrote that Armstrong's model "made several eerily on-the-mark calls using a formula based on the mathematical constant pi."[3] Barron's noted the model called for a change in sentiment in June 2011.[1]

Armstrong's forecast was covered by the Financial Times on June 27, 1998 where Barry Riley wrote on the front Page 2nd Section: "Martin Armstrong, at Princeton Economics, warns that an imminent Russian economic collapse is a bigger threat to the rest of Europe than the Asian slump."[4]


  1. ^ a b c Robin Blumenthal. "Circular Reasoning: A Market for Pi in the Sky?", Barron's, June 25, 2011
  2. ^ a b c d Nick Paumgarten. "The Secret Cycle", The New Yorker, October 12, 2009
  3. ^ Justin Fox. Time magazine. Pg 30; Nov. 30, 2009
  4. ^ Riley, Barry (27 June 1998). "The rubble of the rouble". Financial Times – via Financial Times Historical Archive 1888-2010.