Dow drops 1700 points in the last 6 business days

The Dow hit an all-time high of 26828 on Oct 3.  Since then, it has gone almost straight down:

date	close	change	percent	cum change	cum percent
10/03/18	26828.39
10/04/18	26627.48	-200.91	-0.75%	-200.91	-0.75%
10/05/18	26447.05	-180.43	-0.68%	-381.34	-1.43%
10/08/18	26486.78	39.73	0.15%	-341.61	-1.28%
10/09/18	26430.57	-56.21	-0.21%	-397.82	-1.49%
10/10/18	25598.74	-831.83	-3.15%	-1,229.65	-4.64%
10/11/18	25052.83	-545.91	-2.13%	-1,775.56	-6.77%

A bear market is defined as a drop of 20%  from the prior peak so we aren't there yet, but that is where things are headed.  Assuming that this is the crash we have long been dreading, what does this mean?

Well, it seems to fit the "Ten or Eleven Year Financial Crisis Cycle" I wrote about on April 14, 2017.  At that time I predicted a crash on 9/11/18, so I am off by a month.  So, to compare:

Year	date	significance
1966	August	the first significant postwar financial crisis
1977	July 13	blackout in NYC, which followed a financial crisis
1987	Oct 20	DJIA drops 22% and the system almost collapses
1998	Sept 23	LTCM crisis
2008	Sept 15	Global Financial Crisis; Lehman goes bankrupt
2018	Oct 11	DJIA drops 1700 points since high on Oct 3

The problem with this analysis is that there was no recession in 1966, 1977  (it happened before in 1973-1975), 1987, or 1998.

However, assuming that this is "it", and not just a "buy-the-dip" drop, we can expect a recession to hit within a few months.  NBER, the official arbiter of recessions, won't call the start until about a year after the peak.  But its not too hard to determine - the unemployment rate is the main determiner.  In every recession, it starts shooting up like a rocket.  Right now, the unemployment rate is about 3.7%, a 40-year low.  If it jumps to over 5%, then we are there.

And then we can expect the government deficit to skyrocket because of increased spending and decreased revenues.  Maybe a $2 trillion deficit within a couple of years.