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Perhaps the most important theoretical topic concerning the economy as a discipline is attempting to explain the idea of economic cycles. In practical terms, an economic cycle is understood as being a periodic fluctuation in national income, employment and prices. Successful, and sometimes not so successful, attempts at an explanation have been made in both the media and academic worlds. Perhaps the one that stands out the most is the one offered by John Maynard Keynes. His rivalry with F. A. Hayek is a classic case of the causes and solutions to economic cycles.\u00a0 <\/span><\/span><\/p>\n In addition to explanations offered by the Austrian School of Economics and Keynesianisms and its derivatives, there are other intellectuals that have made an attempt at providing an answer to the causes, conditions and solutions of the economic cycle. Among them in the twentieth century are Milton Friedman and L.V. Mises himself. If we take a look at the past, we encounter other very plausible explanations, as well, such as the one given by Thomas Tooke in the nineteenth century from the perspective of ideas stemming from the Bank of England. <\/span><\/span><\/p>\n Within a less theoretical, and perhaps more practical realm, that of stock traders, there exist other explanations in today\u2019s day and age. Possibly the most predominant characteristic of these practical theories is the fact that they are purely empirical, descriptive and, in a way, historicist. In other words, they renounce any theory based on the philosophy of history and instead focus on concrete conditions that result during certain stages of the cycles. The repetition of these conditions does not intend be able to be explained with any timeless metaphysical theory.<\/span><\/span><\/p>\n Perhaps the most well-known of these theories is that of Kondratiev\u2019s famous long wave cycles which, although theoretical, is used today as very practical. In this same manner, we can discuss Clement Juglar\u2019s theory that discovered and statistically \u201cproved\u201d certain regularities in the economic cycles and that one phase succeeds another. These phases have certain characteristics that, upon identifying them, tell us in which phase of the cycle the economy currently finds itself. Analyzing these practical concepts in a loosely hermeneutic fashion, we can try to determine the point in which the economy of the United States currently finds itself after the financial crisis of 2008. <\/span><\/span><\/p>\n <\/p>\n Graph 1<\/strong><\/p>\n Source: Prepared with data from www.bea.gov<\/p><\/div>\n <\/p>\n The theories on economic cycles that have been designated as being practical are those that focus on the characteristics that different economic agents represent during distinct phases of the cycle. For example\u2026 What kinds of goods are economic agents purchasing or not purchasing during different phases of the cycle? What did Americans stop buying during the 2008 crisis? During other crises, what did they stop buying? In these studies, a myriad of variables were analyzed, and not all gave repeated results as expected throughout history. One very important variable, which seems to follow expected regularity, is the sale of automobiles in the United States.<\/p>\n![\"A.53-1EconomicGrowthRate\"](\"https:\/\/trends.ufm.edu\/en\/wp-content\/uploads\/2016\/03\/A.53-1EconomicGrowthRate.png\")
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<\/a>![\"A.53-4Appendix1\"](\"https:\/\/trends.ufm.edu\/en\/wp-content\/uploads\/2016\/03\/A.53-4Appendix1.png\")
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