If you have never heard of Kondratieff and know nothing of his work, so much the better for this exercise. Either now or sometime later look at this English language translation of a short article written by Kondratieff in the 1920's, archived from a previous website of mine:
http://web.archive.org/web/20050326105529/www.users.qwest.net/~drakete/lwiel-p.pdf To open it, enter "times54" in the password box.
Kondratieff was one of several economists, mathematicians, and market analysts who found a long term market and economic cycle of approximately 54 years from top to top and low to low: nearly 27 years up and 27 down and then repeating. This discovery required reasonably reliable data which were not available until the 18th century. Until quite recently, market data were the only data series that were both continuous and reliable, and in particular the prices of crude goods (commodities) and interest rates were best of all. Kondratieff had only a bit more than a century of data but even so it was clear that two nearly identical long wave cycles had occurred. Starting with the prices and interest rate highs post-Napoleonic Wars (settlement conferences in Vienna 1815), prices and rates can be seen to go down on a trend basis until the mid 1840's, up to a second high at about 1866, down again to the 1890's, and finally up to post WW1 (1918-20). After Kondratieff we have had a down from 1920 to the post WW2 late 1940's, a high in the 1970's, and a low about a decade ago. In my view we are about one-third to one-half way through the latest half cycle of rising prices and interest rates.
The schematic diagram at the Gold-Eagle page gives the impression that the turns are quite sharp and the trends are always straight up or down. Of course they are not. At the last low, commodity prices for various sectors made their multi-decade lows from 1996 (feeder cattle) and 1998 (hogs) to 2000 (cocoa) to 2001 (gold and crude petroleum) to 2003. In the popular press and elsewhere (Paul Krugman's 1999 deflation tract, for example) there were more serious worries about deflation in the late '90's than we now hear. Nevertheless, neo-Kondratieff writers in the 1980's and 90's misinterpreted the obvious major declines in commodity prices and interest rates, and they have largely remained lost in the woods ever since. In large part this was due to the bull market in stocks which confused them. In point of fact, generic stocks indexes can and will rise in both deflationary and inflationary half Kondratieff cycles as long as the deflationary or inflationary pressures are not TOO strong. The key is knowing, as Kondratieff reported, that interest rates and crude goods prices reflect the economic cycle while generic stock indices depend upon "reasonableness" in both phases. When deflation or inflation get out of control, stocks flounder and fall. When rates or prices are rising or falling fairly slowly, stocks will rise. The take-away here for stocks is that they are a second derivative of prices and rates while prices and rates themselves are primary and the effect of long term supply and demand.
It seemed that interest rates, with the long Treasury bond rate as a measure, might have bottomed in 2003. But in 2008 we learned that 2003 was NOT the interest rate low. The classic schematic diagram above has a topping phase which is often called the plateau. Just as individual commodities do not all bottom together, neither do commodities as a class bottom exactly in synchrony with interest rates. The momentum peak for commodities, and the absolute peak for some commodities, came in 1974, but the peak for the long Treasury bond rate was in 1981. Oddly enough, if one adds the 27 year half cycle to each peak we got 2001 for commodities' lows and 2008 for interest rates. This is not to say that this will always be so exact, but 2001 and 2008 certainly fit well to the facts and the pattern. Even given the effects of US dollar devaluation in the 1930's and WW2, interest rates bottomed from 1942-46 **ahead** of the final low for most commodities in 1949. This time rates were to bottom later, perhaps due to central bank influences.
At this point gold and oil and grains and the rest have been rising for a decade while long term rates are only 2-3 years off their lows. Despite the trillions of dollars and yen and renmimbi spent by central banks the past few years to buy Treasury bonds, the low rates of 2008 have not been revisited. Nor do I believe they will be.
The long term Kondratieff odds favor an intensification of inflationary pressures for at least the next decade. This does not mean a steady and synchronized climb in every asset and in rates. But on a long term trend basis prices and rates will rise. And so will generic stock indexes climb until rates and price inflation negatively impacts corporate profits. In the prior up wave from 1949 stocks climbed strongly until 1965 and then went sideways until rates and prices fell into 1981-82.
Nor should we forget US real estate, which will also have a fine bull market starting from historic low real estate prices in many places and with still extremely low interest rates.
These are not short term nor even intermediate term predictions, but the odds strongly favor long term growth. It's also probable that inflation will be a serious problem over the next decade or two, and that major pullbacks will occur from time to time as they did from 1946 to 1974/81.