There are two bubble before peak and second bull market is predicted to emerge creating a massive wealth creation opportunity for a few years. When humans do things in large numbers, we can predict such events as when they will die on the average and we can closely approximate the trend of aging and population and patterns of investment providing fuel for technology innovation. Long term advances in technologies and standard of life are predictable. Innovation booms have been set in motion by the baby boomers spending and productivity cycle. The investment key for profits happens when one understands the relationship between consumer and technology life cycle and how they coincide. The economic boom is not over. The first bubble peaked in 1987, the second in 2000, and the third predicted to peak in 2010. The baby boomers spending behavior did not stop during the trauma of 2000-2002 and will continue on strong into 2009 and 2010 when the majority of innovation will peak, shortly after, a sharp downturn in the economy will occur.

Computer automata will provide scientific advances removing 300 years of fragmented thinking. CA's are simple mathematical formulas that create repeating pattern over long periods of time. Computer Automata seem unpredictable and random at a glance, but they end up too be highly predictable patterns and these simply programs build patterns representative or identifiable as individual universes of complexity; where these simple forms or formulas evolving into complex forms and manifested through predictable cycles of growth and adapting over time.

CA provides determinism. Nothing is random, if one understands the simple factors driving growth; the key too understanding these simple factors is understanding the new science of demographics; demographics rationalizes causes for exponential growth and cyclic change. Once radical new technologies emerge in clusters that adapt in a four stage life cycle creating new growth industries and reengineering of older industries. The Four stage Industry S curve Cycle start with the innovation stage, moves to the growth boom stage, hits the inflection point during the shakeout, and achieves 90 percent plus penetration in the maturity boom. Japan hit the maturity boom in the 1980s and experienced economic decline through 1990s on through 2000s explaining Japans depressed economy. In the US, the baby boomers peaked on starter homes in the 1980s which caused a contraction of home building stocks forcing a 60% crash and crushed the S&L.

The economists are wrong. In 2003 economist claimed a tech bubble existed and they could not be more wrong. The 2nd stage of growth revolution is underway. The bubble will accelerate from 2005 to 2010 and will become the greatest intermediate bull market and technology bubble in two centuries and will be followed by a depression. Only predictable demographic trends and technology cycles can tell one whether a major stock crash is just an extreme correction at the worst of overvaluation cycles and short term political events or the beginning of a long-term decline in stocks and an extended bear market in stocks.

Reasons to invest aggressively: 1. Peak productivity rates are 3 to 4% 2. The high productivity rates cause faster growth in earnings than the GDP. 3 Prices is based on projections of future earnings. The current price is the reflection of internal leveraging for future earnings value causing high P/E ratios and hence the bubble. 2005 will experience massive acceleration in broadband, wireless, and internet. Voice recognition technology will open more customized consumer marketing and individualized preferences. The fifth and final wave in the Elliot wave is underway and will peak approximately in 2010 with the DOW touching 35,000 or 40,000. The technology revolution is not over. Robots, biotech, nanotechnology, and communication will burst on the scene with new products and services capturing the consumer imagination and capital. Trend waves are accelerating on a logarithmic graph exponentially with each wave becoming more exponential.

The safest investment is too buy on dips, investing in Large Cap Companies as the spending wave is pointing up and shifting to bonds when the spending wave is pointing down. Take advantage of the four year Presidential cycles which has produced a 22.6% average annual compound return. The biggest winner is the Decennial cycle and suggests that the investor spend money on the second half of the decaded between the years 5 through 9 where the greatest acceleration of gain occurs and reflect most of the gains in the stock market on the average. If one used the Decennial cycle over the last 51 years their wealth would have increased 44.5 times.

The housing market will not be able to keep pace with stocks, housing prices will not collapse but may experience a downturn in price, high cost of living communities will be the hardest hit receiving disappointment in equity deceleration, and baby boomer will sell homes and downsize creating a buyers market. Home prices may weaken, but there won’t be a major real estate crash since the economy and mortgage rates are too favorable. Upscale housing markets are vulnerable and by 2023 baby boomers will have hit the bottom of the real estate selling frenzy, as they seek to downsize. Real Estate will then start to improve from lower inflation and lower mortgage rates allowing the next generation to afford larger homes with less money down. Currently, there is exists an overbuilding cycle by developers in response to growing demand which has lead to the creation of overcapacity, causing prices to decline. Over the decade prices and building will grow at a moderate rate at best. There is no prediction of a housing market crash. Demographically, at age 40-41 trade up buying in home will peak, total home purchasing will peak at 37 years, and downsize will occur at 54 years of age. Interestingly, house prices may fall years before a downward turn in the stock market and a downward turn in upscale urban/suburban homes will feel the hit the worst between 2010 through 2014. The vacation home market will continue to grow faster than residential and about the same time that the demographic demand for primary residency slows in face of rising mortgage rates and overbuilding. Resort and hotels should grow dramatically over the next decade as travel comes back.