BBI October 2022 Q&A — Boom Bust Insiders
Summary
October 2022 session as the market approaches the cyclical low. Akhil explains in detail how the UK pension fund crisis (Liability Driven Investment instruments, margin calls on gilts) is a “trial run” for how the cycle ends — the same mechanism will operate at larger scale in 2026 with collapsing property values and bank balance sheets. Phil connects the 1994 California Pension Fund crisis to the current events (both second-half cycle events). Key date: October 15 is a seasonal midpoint; October 28 is another important timing date.
Key Claims
| Claim | Confidence |
|---|---|
| UK pension LDI crisis is a trial run for how the cycle ends — same mechanism, different scale | High |
| End-of-cycle crises always emerge from unexpected corners — in 2008 it was mortgage securities, UK 2022 it was pension LDI | High |
| October 15 and October 28 are seasonally important dates (dividing the year by 16 from March 21) | Medium |
| The landed aristocracy acts through the financial system to prevent worker power; recessions are manufactured | Medium |
| Two key rules: (1) Fed always behind curve; (2) Government action always makes things worse | High |
| October low will be followed by a recovery into year-end | High |
Predictions / Forecasts
| Forecast | Target Date | Status |
|---|---|---|
| October 15 and October 28 are key market turning points | Oct 2022 | Confirmed (Oct 13 low, Oct 27 significant low) |
| Recovery from October into year-end 2022 | Q4 2022 | Confirmed |
| Liz Truss will be replaced by more “conservative Tory” 6–12 months before UK election | 2023–2024 | Confirmed (Sunak replaced Truss) |
| UK/European remilitarization spending = bullish for defense stocks | 2022 onwards | Confirmed |
| Political chaos in US, UK, Europe = classic second-half pattern | 2022–2026 | Ongoing |
Market Calls & Cycle Position Analysis
- Markets “winding up” from midpoint to midpoint; October low → recovery
- False breaks more common now than in Gann’s day; markets reverse faster as shorts cover
- Bank stocks: VUK earnings doubled (gap-up breakout from accumulation); watch UK banks for new highs
- All the conditions are setting up: land price not yet topped, banks healthy, credit expanding
- Phil: “The lineup is there now” — gets nervous when it’s this obvious because markets should never be that easy
Property & Stock Guidance
- Banks (UK/Australia): Breaking out as net interest margins expand; watch for new highs
- UK REITs: Bottomed before the broader market → leading indicator
- Tech stocks: Second half of cycle → they underperform because rising inflation discounts future earnings
- Australian small banks (MoneyMe): Priced for Armageddon; turn = strong buy signal
- Housing stocks (US): D.R. Horton and West Farmers holding well; higher lows in October = bullish
Notable Quotes
“No one had heard of liability driven investing instruments a few weeks ago. Now a lot of people have. No one really thought that a few issues in the UK pension industry would have such global repercussions.” — Akhil Patel
“In 1994, February 3 was the day. Fed lifted interest rates, California Pension Fund was caught short. But it brought about a high or low in the Dow which confirmed it wasn’t going to bring any more land price collapses. Then 1995, Marc Andreessen invented the browser. We’re off to the races.” — Phil Anderson