Our recent guest Lakshman Achuthan and his partner Anirvan Banerji are featured in the July 26th issue of Fortune. The article talks about:

1. Their work at the Economic Cycle Research Institute (their clients range from DuPont to the CIA)
2. Their book Beating the Business Cycle (the 20,000 copy first printing sold out)
3. And their current forecast (“The weekly leading index points to a slowdown in the U.S. ‘We are going from above-trend growth to closer to trend – about 3%,” says Achuthan. Meanwhile, he says, the future inflation gauge projects rising heat: ‘Both core CPI and CPI are in a cyclical up-turn.’ Oh, and housing prices are still headed upward.”).

Lakshman’s recent visit starts here and you can click forward to find the rest of his entries.

Yesterday, The Wall Street Journal ran an excerpt [sub. needed] from The (Mis)Behavior of Markets: A Fractal View of Risk, Ruin, and Reward by Benoit Mandelbrot and Richard Hudson (Basic Books). Here is an excerpt from the excerpt:

To [Richard Olsen], a financial transaction is like a small explosion. Conventional financial theory, as taught in business schools around the world, holds that prices change continuously, and that each investor is as unimportant as the next. Their trades are like the collisions of molecules in a gas chamber — millions of tiny energy exchanges. Nonsense, Mr. Olsen says. His tick-by-tick data show plainly that prices jump. Quotes stutter. And investors vary greatly in importance and impact on the market. A more accurate metaphor is the chamber in an internal combustion engine: Millions of small and large explosions drive the car forward, as the sparkplugs fire and the pistons churn.