Longwave (2): Make that three peaks

After I saw the similarities and differences between DPD and the interest rate (see yesterday's post) I decided to plot the two against each other, like inflation versus unemployment on the Phillips Curve graph. So I went back to EconomPic, where Jake has a link to interest rate data from Robert J. Shiller's Irrational Exuberance. When I clicked Jake's link, download started automatically for the Excel file ie_data.xls.

The file contains two sheets with graphs, and one with data going back to 1871: stock dividends and a price index among others, and in column G the interest rate numbers.

A graph of Shiller's interest rate data going back to 1871 shows three longwave peaks. Not two:

Graph #1

The graph also seems to show "secondary" peaks at the lows: one in the neighborhood of 1894, and another at the time of the Great Depression. The first of these falls neatly at the "bottom" between the 1872 and 1921 peaks. The second seems to come before the 1941 low, and belie the notion of secondary peaks. Could be. Or it could be that the severity of the Great Depression -- or the policy response to it, or both -- created additional downward force. I am obviously not prepared to say at this time.

The years between the first peak and the end of the first "secondary" peak match the years of the Long Depression.