Crises are cyclical in nature due to the cyclical mood of the masses of investors. The whole market is nothing more than a game of the moods of bulls and bears in different weight categories of wallets with different risk limits.
You can imagine this as the sum of waves with different periods, which as a result form a visual representation of the market in the form of a graph. But at the same time, each separate group of people and even one person behaves the same way - it moves from extreme to extreme, from mania to panic. And the market itself behaves irrationally - exactly at the moment when all investors believe that the instrument will only grow (mania), it starts to fall, because there are no more buyers, and the offer is growing like an avalanche.
For example, if you take the bank lending sector, then it has a foreseeable limit - you cannot give out more credits than the consumer is able to take. But the consumer has already been credited and there is no turning back. This means that at some point banks will no longer be able to creadit the consumers, and this in itself will cause a deflationary collapse: there are no credits, consumer dont have money for pay anything, there is no profit for the companies, there are many unemployed, and again - no credits. Economic is stop.
It is this process of adding the mood of the masses of investors that the elliott wave theory studies and describes. And she has long and accurately predicted the future - SNP500 goes to 666 points, BRENT Oil - 12$ (and no matter when).
Just wait..
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