Growth …

… is a non-linear entity.

Especially…

… high growth.

Amongst many things, …

… one point needs …

… pointing out.

Between periods of high growth…

… anything can happen.

The levels of what can happen are, amongst other correlations, directly proportionate to the number of similarities between an economy in question and the functioning of a proper banana republic.

Freedom of speech can be suppressed.

Parallel economies can thrive.

Extortion and blackmail can rule.

Genocide.

Landgrab.

Terrorism.

People buyouts.

Apathy.

Dysfunctionality.

And then there’s high growth again, perhaps soon, if the economy gets its act together despite its rulers, and perhaps accelerated, if the rulers come to their senses and return back to being peace, growth and democracy loving .

Without getting into what kind of a republic we live in, for lack of a better phrase, and with a very small use of one’s imagination, one could venture to suggest that our own path of growth could resemble that of a banana trajectory.

The banana in this title doesn’t have much to do with the curvature of the fruit.

Much rather, it’s about the economy to banana republic correlation.

Might I suggest that our economy’s banana behaviour is mostly mild. Then, rarely, it gets intense. Normal growth returns. Then comes high growth. Periods of very high growth are rare, but there too.

Overall I’m happy with my and in my republic.

Sometimes, its banana behaviour beats me up.

Yeah, every ten years or so, there’s a big hit.

No one likes getting hurt.

I do remember to stand up and continue fighting, …

… because it is in this very republic, that I can make my 15% p.a.c.

On the conservative side, that is. Perhaps I can make more.

I don’t get that in any other economy.

You see, occasional banana behaviour is good news for a long term contrarian.

Banananomics lead to blunders, and temporary downfalls, with all indices falling big.

Which is where we have the guts to buy, and big.

Why?

We know we are on a high growth trajectory with intermittent banana behaviour.

A very simple formula suggests itself.

Buy big during reactions to banana behaviour.

Take principle out after spurts of high growth.

Sit tight on underlying in profit, perhaps for life.

A high growth trajectory with intermittent banana behaviour will give you many such cycles in your lifetime.

One stands to make multiple times the ten-yearly hits.

Upon recognising this recurring pattern, one can even fine-tune and enhance loss-attenuation.

🙂