Table of Contents
- What is “The Fourth Turning”?
- What the USA Should Have Done to Avoid the Current Crisis
- How Will the Crisis Play Out From Here?
- How Will The Crisis Conclude?
- Neil Howe on What to Expect Next – Creative Destruction
- New Book: “The Fourth Turning Is Here”
- But We’ll Stumble Through to the Other Side
- The Fourth Turning and Gold’s Coming Peak Valuation
Estimated reading time: 7 minutes
The CoronaVirus, ongoing polarisation in America and now war in the middle east has brought a book from 1997 back into focus. The Fourth Turning: An American Prophecy was written by Neil Howe and William Strauss.
It is a study of generational cycles in the USA. It reveals predictable social trends that repeat throughout history. With the culmination in a transformational crisis. i.e. The Fourth Turning.
We first covered this fascinating book way back in 2009. See: Where America went wrong and how to prepare for the consequences.
In 2016 we featured some excerpts from one of its authors on China: Satyajit Das: 2 Outcomes – “Managed Depression” or “The Mother of All Crashes”.
But we’ve seen it mentioned many times after the corana-panic began.
So far the predictions made in this fascinating book are eerily accurate. Today we’ll look at what is yet to come. Why it will affect the entire planet and not just the USA. We’ll also hear from one of the authors directly. As Neil Howe has recently released an updated version titled “The Fourth Turning Is Here” (William Strauss is no longer alive)…
What is “The Fourth Turning”?
The Fourth Turning focuses on what will happen in the USA. However the turnings will likely apply to the whole planet. Given the USA remains the largest economy and still holds the global reserve currency in the form of the US dollar. So where the USA goes, so goes the rest of the globe.
We are now in the final stage of the Fourth Turning. We’re seeing the destruction of the old and this will be followed by the birth of the new.
Here is a simple summary of Strauss and Howe’s concept of the four turnings:
“The two tracked history back 500 years and showed a repeating pattern where humanity and mother nature collectively faced boom and bust linked to the four seasons of our lives.
> Since Arthurian times, humanity has followed a cycle of 20-22 years, coinciding with our four stages of life (Spring in our childhood, Summer in our 20’s, Autumn in our 40’s, Winter in our 60’s)
> In each of these turnings, we experience a similar set of challenges and circumstances, and the next generation takes on a different archetype which shifts our collective consciousness.
The 1st turning is the “High”. This is the spring, where a new world order is created and a generation of “Prophets” lead a new spiritual awakening.
The 2nd turning is the “Awakening”. This is the summer, where new social ideals are formed and a generation of “Nomads” spread and drive forward the message of the new.
The 3rd turning is the “Unravelling”. This is the autumn, where the whole breaks into parts and a generation of “Heroes” shine a light at the shadows of what is now an old world order.
The 4th turning is the “Crisis”. This is the winter, where the old world order breaks down and a generation of “Artists” create a brand new paradigm.”Source.
What the USA Should Have Done to Avoid the Current Crisis
In 1997 Strauss & Howe warned that America was close to the start of the Fourth Turning for this generational cycle. They recommended that the USA prepare in the following ways:
Prepare values: Forge the consensus and uplift the culture, but don’t expect near-term results.
Prepare institutions: Clear the debris and find out what works, but don’t try building anything big.
Prepare politics: Define challenges bluntly and stress duties over rights, but don’t attempt reforms that can’t now be accomplished.
Prepare society: Require community teamwork to solve local problems, but don’t try this on a national scale.
Prepare youth: Treat children as the nation’s highest priority, but don’t do their work for them.
Prepare elders: Tell future elders they will need to be more self-sufficient, but don’t attempt deep cuts in benefits to current elders.
Prepare the economy: Correct fundamentals, but don’t try to fine tune current performance.
Prepare the defense: Expect the worst and prepare to mobilize, but don’t pre-commit to any one response.Source.
Instead the USA seems to have done almost the exact opposite of each of these action points since 1997! So instead of circumventing the crisis, we now have to go straight through it.
How Will the Crisis Play Out From Here?
Futurist, Roger Hamilton, has written an excellent summary of what the Fourth Turning has in store for us. It includes some very relevant excerpts taken directly from the book (Note this was written in June 2020):
“The 2020 coronavirus and civic disorder crises we are seeing was predicted 30 years ago, and we’re only in the first of five stages.
When William Strauss and Neil Howe wrote their book “Generations” in 1991, they showed how all modern history repeated in an 80 to 90 year cycle called a “Saeculum”.
Realising we were heading towards a once-in-a-lifetime crisis period, they then wrote “The Fourth Turning: An American Prophecy” to warn us of what was going to occur between 2005-2025.
The last three times the US had experienced the Fourth Turning it ended in the American Revolution (1767-1791), the American Civil War (1843-1859) and the Great Depression & World War II (1925-1942).
While it’s a US focused book, the Fourth Turning applies to the world as a whole, and here is what it predicts in each of the five stages of the crisis:
STAGE ONE: THE SPARK
“A spark will ignite a new mood. The CDC announce the spread of a new communicable virus. Congress enacts mandatory quarantine measures. Mayors resist. Urban gangs battle suburban militias. Calls mount for the president to declare martial law.”
“At home and abroad, these events will reflect the tearing of the civic fabric at points of extreme vulnerability – problem areas where, during the Unravelling, America will have neglected, denied or delayed needed action. Anger at ‘mistakes we made’ will translate into calls for action, regardless of the heightened public risk.”
STAGE TWO: THE DISRUPTION
“The new mood and its jarring new problems will provide a natural end point for the Unraveling-era decline in civic confidence. In the pre-crisis years, fears about the flimsiness of the social contract will have been subliminal but rising. As the crisis catalyzes, these fears will rush to the surface, jagged and exposed.
Distrustful of some things, individuals will feel that their survival requires them to distrust more things.This behavior could cascade into a sudden downward spiral, an implosion of societal trust.”
STAGE THREE: THE COLLAPSE
“At some point, America’s short-term crisis psychology will catch up with the long-term post-Unraveling fundamentals. This might result in a Great Devaluation, a severe drop in the market price of most financial and real assets. As assets devalue, trust will further disintegrate, which will cause assets to devalue further, and so on
“Many Americans won’t know where their savings are, who their employer is, what their pension is, or how their government works. The era will have left the financial world arbitraged and tentacled; Debtors won’t know who holds their notes, homeowners who owns their mortgages, and shareholders who runs their equities – and vice versa. Before long, America’s old civic order will seem ruined beyond repair.
People will feel like a magnet has passed over society’s disk drive, blanking out the social contract, wiping out old deals, clearing the books of vast unplayable promises to which people had once felt entitled.”
STAGE FOUR: THE CLIMAX
“From this trough and from these dangers, the makings of a new social contract and new civic order will arise. This battle could be peaceful or violent, involving public and private militias. Decisive events will occur – events so vast, powerful and unique that they lie beyond today’s wildest hypotheses. Thus will Americans reenact the great ancient myth of the ‘ekpyrosis’. Thus will we achieve our next rendezvous with destiny.
Armed confrontation usually occurs around the climax of the crisis. If there is confrontation, it is likely to lead to war. This could be any kind of war – class war, war against terrorists or superpower war.”
STAGE FIVE: A NEW BEGINNING
“The economy will in time recover. Compared to today, it will be less globally dependent, with smaller cross-border trader and capital flows.
Emerging in this crisis climax will be a great entropy reversal, that miracle of human history in which trust is reborn. In a moment of maximum danger, that seed will implant and a new social contract will take root. For a brief time, the American firmament will be malleable in ways that would stagger today’s unraveling-era mindset.
The crisis climax will recede into the public memory – a heart-pounding memory to all who will recall it personally, a pivot point for those born in its aftermath, the stuff of myth and legend for later generations.”
According to Strauss and Howe, these five stages won’t be over until 2025, when we will enter the next first turning, and the beginning of a new world order.
At the time when they published the Fourth Turning, it was the Dotcom boom years. Most dismissed their work, except for the media and marketers who reported and profited on their predictions of the millennial generation. Even those who followed their work felt there was little urgency in the crisis prophecy as it was still decades away.
Now that the crisis is here, it’s time to pay attention and see our part in the great cycle of time.
The winning formula of the last turning is the losing formula of this one. How we think, act and lead needs to change with the season of humanity we are in.
Or we will lose our spirit, lose our minds, or both.
“All the forces in the world are not so powerful as an idea whose time has come.”
– Victor Hugo
* More details on the Fourth Turning in this post – Click here”Source.
How Will The Crisis Conclude?
At the conclusion of this current fourth turning, we will likely see the end of nation states. Much as Doug Casey has discussed in the past with the idea of “phyles”. The idea being that people will group not according to geography, but according to similar values and interests.
Then humanity will begin a new great age like nothing we’ve seen before.
“The 4th turning we are in now was last seen in 1925-1942: The 1929 crash and Great Depression.
The great age we are about to enter is the equivalent of the Renaissance 500 years ago.”
While Roger Hamilton says that the end of the fourth turning is expected in 2025 that is just a guide. It could take longer than this to play out. Because this current crisis began around 2008. And it would be expected to last a normal generational period of 20-30 years. So that could be anywhere from 2028 to 2038.
Neil Howe on What to Expect Next – Creative Destruction
So what can we expect next? Here it is direct from the horse’s mouth. One ofThe Fourth Turning Authors, Neil Howe, via a Peak Prosperity podcast back in 2020:
During times of peace and prosperity, inequality over time always increases. It always increases. There are only four things which reduced inequality through history: total war, total revolution, famines, and plagues.
You have this weird situation in America now where interest rates are practically 0% and almost no one is doing any investing. How do you explain such high returns on existing capital with 0% interest rates, and yet no one’s using those low interest rates? Because new creators of business can’t get the same high returns as the incumbents. That’s the reason.
So we have a bifurcated market and I think that this is what has to be broken down. The fourth turning is to some extent an act of creative destruction. It destroys as much as it creates. We saw that in the 1930s. We saw that in the 1940s which, by the way, was a period of huge shift from inequality to equality in America.
But I do think there’s a broader point about inequality and this is point about creative destruction. There has to be some destruction in there. You have to destroy the privileges. You have to destroy the sinecures — and that’s never pleasant. But it’s part of the process.
I’ve often told people — if they expect to see Social Security reformed, global warming solved, and god knows what else you’re talking about on a peaceful sunny day — that big reforms come about during dark and stormy nights. And I’m talking about BIG reforms…reforms that actually commit society to huge new sacrifices.Source.
Hear what’s most likely to happen next during this current Fourth Turning in this interview of Neil Howe by Chris Martensen.
Neil Howe: Expect Creative Destruction In This Fourth Turning
New Book: “The Fourth Turning Is Here”
As noted already, while William Strauss has passed away, his surviving co-author Neil Howe has recently released an updated version their book called “The Fourth Turning Is Here”. The first 75% of which is simply a revisiting of their past work.
Howe then delves into what might play out from here, now that the crisis seems to be upon us. To us it is not as balanced a book as the first one was. Perhaps the fact that this is the work of only one of the authors is why?
But regardless, if these next 10 or so crisis years go like the previous turnings, it will be the upcoming “Hero” generation, who are now roughly in their 30s, who will become saviours. Interestingly we have never had so many different generations alive and also in positions of power and influence as the fourth turning begins. Because we have much longer lifespans currently for those above 80.
With war breaking our between Israel and Palestine, and the potential for this to spread further, there is the very real possibility for much greater (and unfortunately perhaps global) armed conflicts arising before this crisis is over.
But We’ll Stumble Through to the Other Side
John Mauldin also had some thoughts on the Fourth Turning. He pointed out that the USA will likely have a major recession as a result of the coronavirus which…
[GSG editors note: This is the creative destruction that Neil Howe discussed in the interview above]
“…leaves us in a bad spot, just as Neil Howe’s Fourth Turning period approaches its peak in the coming decade. We are at the point in his generational cycle when society’s institutions are shaken, and sometimes destroyed and replaced. George Friedman points to the latter half of the 2020s as a similar cyclical peak, for different reasons. They both agree the next decade will be highly volatile and tumultuous.
Having talked with both Neil and George, they both still see the true problems developing in the latter part of this decade. That coincides with my own concept of The Great Reset, centered around the accumulation of debt.
I have repeatedly demonstrated how large amounts of debt reduce potential GDP growth. We are now past the point of no return. I know Paul Krugman and others say it doesn’t matter, but the data says otherwise.
The world is now run by a cadre of intellectuals (call them elites or whatever) who have theories about how the world should work and are intent on implementing those theories. We will explore it further in the future, but these theories will aggravate the economic divide. Raising taxes on “the rich” won’t have the beneficial results they expect. We’re way past that point.
I don’t see how we get through this without significant pain. I also don’t know how to reconcile that with present political structures. People don’t typically vote to bring pain on themselves, nor do they react kindly when they perceive the winner wants to hurt them.
At the same time, I’m still hopeful. We have been through harsh recessions, pandemics, and political polarization before. We have seen Fourth Turnings before. They aren’t fun. Yet we always get through them. Not without losses, both financial and personal, but the world survives, society rebuilds, and life goes on.
Seriously, you can look at every similar past cycle and if all you focus on is the pain, you miss the incredible businesses and opportunities that developed at the same time. That’s what I expect this time, too.
The Stumble-Through Economy
I coined the term “The Muddle-Through Economy” in the early 2000s to describe what I saw as the economy of the next decade. I kept repeating it this last decade. Sadly, it is time to retire that term. I don’t think we muddle through in the 2020s. It will be more like Stumble Through.
By that I mean the market volatility, political polarization, global discord, and transformational technology and business changes will at times seem overwhelming. Governments will change their priorities with each election cycle. Continuity will become a thing of the past. We will long for the good old days of 2% growth.
But the point is that we’ll get through. The world won’t end, and if you pay attention, there will be opportunities all around.Source.
The Fourth Turning and Gold’s Coming Peak Valuation
Roger Hamilton points out above that, “According to Strauss and Howe, these five stages won’t be over until 2025, when we will enter the next first turning, and the beginning of a new world order.”
Interestingly the end of this last cycle of the Fourth Turning, ties in closely with the cycle we discussed back in 2021 for gold.
In “Gold Cycles vs Property Cycles in 2021: When Will Gold Reach Peak Valuation?”, we surmise that gold could reach a peak around 2026…
The Gold Bull Market Cycle Since 2000
Compare the 70’s to the current gold bull market cycle and there are some interesting similarities.
1. The current bull market has been roughly double that of the 1970’s in terms of time.
2. It saw a rise from 2001 to 2011. This was 10 years or roughly double the 4 year rise of the early 1970’s.
3. Then the correction from 2011 to late 2015 lasted just over 4 years. Again around double the 1970’s almost 2 year correction.
Now look at the rises in percentage terms.
From the 2001 low up until June 2019, gold had risen about 560% ($250 to $1400). Comparing this to the 1970’s, this is similar to the rise up until 1977.
When Will Gold and Silver Reach their Peak Valuations?
We don’t think it’s too over the top to assume that there is still another leg higher to come in this gold and silver cycle. If precious metals follow a similar script to the 1970’s, that would mean another 6 years or so of higher prices to come for gold.
It’s probably not very surprising that our gold cycle matches up closely with the end of the fourth turning! After all, the monetary system plays a major role in the flourishing, or alternatively the decay, of society. Hence, it’s likely that we could see a change in the monetary system at the end of this current Fourth Turning. [Perhaps 2026 is now a little too soon being only 3 years away. But this decade certainly seems likely].
Maybe, along with the end of nation states, we will see the end of national currencies too?
Therefore with the change from nation states to smaller groups of people sharing values, we may also see different types of money. Perhaps with people choosing to use whichever money suits them best?
(This is the “free market for money” that we have discussed previously. See: The Gold Standard & A Free Market For Money: What Do We Think About It?)
The difficultly here is in guessing exactly what that money will be. It’s why we say act like our fictional sleeping beauty and buy some gold. See: Why Sleeping Beauty Should Own Some Gold or Silver.
Gold is also likely to be especially beneficial to hold in Stage 3: The Collapse, referred to earlier. Gold will protect you from devaluation of other financial assets…
“This is where we might see a Great Devaluation, a severe drop in the market price of most financial and real assets. As assets devalue, trust will further disintegrate, which will cause assets to devalue further, and so on”
“Many Americans won’t know where their savings are, who their employer is, what their pension is, or how their government works. The era will have left the financial world arbitraged and tentacled; Debtors won’t know who holds their notes, homeowners who owns their mortgages, and shareholders who runs their equities – and vice versa. Before long, America’s old civic order will seem ruined beyond repair.”
This second paragraph above is also a very good reason to own gold. As it has no counter-party risk. Gold is the only financial asset which isn’t at the same time someone else’s liability. As long as you hold it physically you won’t have the worry of where your savings are in the coming troubles.
Ensuring you hang onto your wealth will mean you can be of the most benefit to your family and society in the 5th stage of the Fourth Turning: The New Beginning… You can check out the range of gold to buy here, and ensure your wealth survives.
Editors note: This post was first published 23 June 2020. Last updated 17 October 2023.