When we talk about the decline in social mood, we can define it as a general feeling of uncertainty about the future and a less hopeful outlook. For comparison purposes, let's take a quick look at the nearly two-decade bull market. According to the Elliott Wave formation, the mood in America (and much of the world) was on the rise from about 1982, peaking around the end of 1999 and into 2000. What were the cultural manifestations?
There's an old Wall Street axiom that as the stock market rises, so do hemlines. Look at the fashions from the mid-eighties on into the new millenium. Hemlines rose, micro mini's became popular (thank you), and are still popular today - for now. Other fashion staples have been tight shorts, tight shirts (along with the rage for breast implants, again, thank you), tight jeans, and low cut blouses.
Robert Prechter, in Pioneering Studies in Socionomics (a must read for anyone interested in Socionomics, along with its sister publication The Wave Principle of Human Social Behavior and the New Science of Socionomics), talks about the movies and the stock market. In bull markets, Disney movies, romantic comedies, and upbeat feel-good movies are popular. In bear markets, horror movies featuring monsters, vampires, werewolves, zombies, and aliens, with graphic torture and other horrific images become popular. The public has an appetite for blood when the collective mood turns dark, or even during the transition from light to dark, as appears to be happening now. The theaters have been busy with vampires, devils, demons and zombies, and even satires of these genres, like Zombieland and Vampires Suck.
Similar correlations can be found in popular music style, as bear market music becomes more complex, anxious and brooding, as opposed to the simple, lighter chords and celebratory lyrics of a bull market.
But these are all pop cultural observations, and don't really communicate the overall feel of things on the street, the interpersonal communication in which we participate throughout the day. What does this "decline in social mood" feel like at the street level?
The feeling I get is people are "anxious", with a kind of simmering undercurrent of dissatisfaction bordering on anger. The future seems very uncertain. People who have jobs are nervous about losing them, and people who have lost their jobs are losing hope of finding one any time soon.
People still have the desire to be hopeful, but at a subconcious level hope is fading and people are less optimistic about the future. As social mood shifts from a transitionary period (where we are now) to a full-on move toward pessimism, expressions of dissatisfaction are likely to go from passive to active. This will appear in the form of protests (Tea party, anyone? An early, mostly peaceful movement), demonstrations, and in extreme instances, riots.
On a more personal level, I've noticed a subtle change in the "politeness" of the general public. Customer service at the grocery store seems a little strained, the cashiers don't smile quite as sincerely. People don't hold doors for each other as often. The person in line in front of you at the bank is staring at the floor, frowning. These are small things, not quantifiable, but anecdotal to the feel of things.
I was playing golf with an older gentleman recently and we were talking about current events. He told me he was 84 and was a little boy during the Great Depression, and only has vague memories of that time, but he's been through plenty of recessions since then, and he said, "Son, I've never seen it like this. People are losing hope. Tell you the truth, I'm scared to death for our country."
Time will tell if the socionomic theory accurately forecasts the continuing bear market, and the most extreme feelings of pessismism in nearly three centuries. From a socionomic perspective, it will be interesting, to say the least.
Sunday, September 5, 2010
Wednesday, September 1, 2010
Where We Are Today
According to Elliott Wave analysis, social mood reached a peak at several degrees of trend around 1999-2000. The significance of this is hard to overstate. At the Grand Supercycle degree of trend, social mood reached a Wave III (circle) peak in 2000, a wave that began in 1784. As it was a Grand Supercycle peak, all smaller degrees of trend also peaked at this time. It was manifested in the stock mania of the 1990's that culminated in the tech stock bubble and subsequent implosion. Thus began a decline in social mood at the highest degrees of trend, and therefore the strongest downward pressure on social mood in almost three centuries.
According to socionomic theory, all aspects of society are affected by the collective social mood, including trends in economics, entertainment, fashion, politics, sports, religion, race relations, international relations, architecture, and art, just to name a few.
As social mood began to decline (decreasing optimism), the stock market has also declined. From 2000 until around 2003 the US was in a minor recession. This was Cycle Wave A (down) of Supercycle Wave (A) (down). Cycle wave B (up) lasted from 2003-2007 and included the real estate bubble, which began to implode in mid-to-late 2007. We are now in Cycle Wave C (down) of Supercycle Wave (A). This is and will continue to be the strongest wave down until we bottom out and begin Supercycle Wave (B), (up). According to forecasts by the top Elliott Wave experts, we should hit the bottom of this wave between 2014 and 2016. Between now and then, the world is going to experience epic change.
When social mood is rising (increasing optimism) it appears to correlate with a collective increase in feelings like benevolence, inclusion, supportiveness, togetherness, feelings of homogeneity with others, tolerance, practical thinking, search for joy, and similar emotions that characterize happiness and optimism.
When social mood is declining (decreasing optimism moving toward increasing pessimism), we see the manifestations in feelings of protectionism, malevolence, magical thinking, separatism, xenophobia, discord, exclusion, intolerance, anger, and fear.
Now that we've established a rudimentary understanding of socionomics and social mood, future posts will focus more on the manifestations of social mood, and insights on how each of us will be affected as we navigate the progressively turbulent waters of the current bear market and declining social mood.
According to socionomic theory, all aspects of society are affected by the collective social mood, including trends in economics, entertainment, fashion, politics, sports, religion, race relations, international relations, architecture, and art, just to name a few.
As social mood began to decline (decreasing optimism), the stock market has also declined. From 2000 until around 2003 the US was in a minor recession. This was Cycle Wave A (down) of Supercycle Wave (A) (down). Cycle wave B (up) lasted from 2003-2007 and included the real estate bubble, which began to implode in mid-to-late 2007. We are now in Cycle Wave C (down) of Supercycle Wave (A). This is and will continue to be the strongest wave down until we bottom out and begin Supercycle Wave (B), (up). According to forecasts by the top Elliott Wave experts, we should hit the bottom of this wave between 2014 and 2016. Between now and then, the world is going to experience epic change.
When social mood is rising (increasing optimism) it appears to correlate with a collective increase in feelings like benevolence, inclusion, supportiveness, togetherness, feelings of homogeneity with others, tolerance, practical thinking, search for joy, and similar emotions that characterize happiness and optimism.
When social mood is declining (decreasing optimism moving toward increasing pessimism), we see the manifestations in feelings of protectionism, malevolence, magical thinking, separatism, xenophobia, discord, exclusion, intolerance, anger, and fear.
Now that we've established a rudimentary understanding of socionomics and social mood, future posts will focus more on the manifestations of social mood, and insights on how each of us will be affected as we navigate the progressively turbulent waters of the current bear market and declining social mood.
The Stock Market as a Sociometer
A sociometer is a direct reflector of the states and trends of social mood. A gauge, if you will, of the collective social mood. There are many different types of sociometers, some better than others because the readings are much more immediate and easily quantified, such as the stock markets.
Why the stock market as a sociometer? According to Robert Prechter, the world's foremost expert of the Elliott Wave Principle and father of the new science of Socionomics, the stock market is the most immediate measure of the collective social mood, offers a preponderance of data going back several hundred years, and is easy to access and obtain. It is also easy to graph and therefore easy to observe and identify the formation of Elliott Waves.
There are many different stock markets across the globe, but for the purpose of this blog we will focus on the DJIA, S&P, and NASDAQ. As socionomics is such a new science, there is much work to be done and many studies to be performed, and up to this point most socionomic research has been done in relation to these market indexes. And as I am an American and will be making observations primarily about American culture and events, these indexes will be most appropriate.
Why the stock market as a sociometer? According to Robert Prechter, the world's foremost expert of the Elliott Wave Principle and father of the new science of Socionomics, the stock market is the most immediate measure of the collective social mood, offers a preponderance of data going back several hundred years, and is easy to access and obtain. It is also easy to graph and therefore easy to observe and identify the formation of Elliott Waves.
There are many different stock markets across the globe, but for the purpose of this blog we will focus on the DJIA, S&P, and NASDAQ. As socionomics is such a new science, there is much work to be done and many studies to be performed, and up to this point most socionomic research has been done in relation to these market indexes. And as I am an American and will be making observations primarily about American culture and events, these indexes will be most appropriate.
The Socionomic Perspective
The purpose of this blog is to provide a socionomic perspective on current world events. What is a "socionomic perspective", you ask?
Simply put, socionomics is the study of social mood. It is the science of social analysis based upon the socionomic insight.
The socionomic insight is a revolutionary way of viewing the world, world events, and society in general. To quote Robert Prechter, father of the science of socionomics: "The socionomic insight, as opposed to the conventional belief that social events determine the character of social mood, is the understanding that in fact social mood determines the character of social events."
This concept can be difficult to grasp because we've been taught over the years, implicitly if not explicitly, that world events affect and determine the mood of the population. Conventional theory teaches us that exogenous causes and events determine the direction of the collective social mood. Socionomics turns that belief upside down and says, no, actually, there is an endogenous mechanism within all humans that creates and propels the collective social mood. It is believed that this endogenous mechanism is related to an unconscious herding impulse generated by the brain's limbic system.
And socionomics goes further than that in saying that not only is social mood endogenous, but, as Prechter states: "... patterns of aggregate human behavior are self-causing, self-regulating, self-reinforcing and, to a far greater degree than has heretofore been imagined, predictable."
That's right, predictable, because the patterns in social mood follow a repeating, self-similar form known as a "fractal". In the case of social mood, this fractal is called a "robust fractal". In other words, the repeating form is self-similar but not identical, and has numerous variations that follow certain identifiable rules. These rules are part of what is known as the Elliott Wave Principle, the foundation for the science of socionomics.
Briefly, R.N. Elliott, while studying patterns in the stock market back in the 1930's and 40's, identified a repeating, self-similar form that followed certain identifiable rules. He formulated the Elliott Wave Principle based on his studies. Robert Prechter stumbled upon Elliott's published works and began using the Elliott Wave Principle to forecast movements in the stock market in the 70's. He enjoyed tremendous success and still does today. Fairly early into his work he observed that many areas of mass human activity displayed the Wave Principle, and he embarked on a journey to study this insight. Thus, today, we have the new science of socionomics.
I've presented a very brief and superficial explanation of the short history of socionomics, and I would encourage anyone who is interested to do some additional research for a more in-depth understanding of the Wave Principle and the science of Socionomics. The purpose of this blog is to apply the socionomic perspective to shed a different light on world events, and perhaps offer some insight as to why events are occuring as they do at this critical time in world history.
Simply put, socionomics is the study of social mood. It is the science of social analysis based upon the socionomic insight.
The socionomic insight is a revolutionary way of viewing the world, world events, and society in general. To quote Robert Prechter, father of the science of socionomics: "The socionomic insight, as opposed to the conventional belief that social events determine the character of social mood, is the understanding that in fact social mood determines the character of social events."
This concept can be difficult to grasp because we've been taught over the years, implicitly if not explicitly, that world events affect and determine the mood of the population. Conventional theory teaches us that exogenous causes and events determine the direction of the collective social mood. Socionomics turns that belief upside down and says, no, actually, there is an endogenous mechanism within all humans that creates and propels the collective social mood. It is believed that this endogenous mechanism is related to an unconscious herding impulse generated by the brain's limbic system.
And socionomics goes further than that in saying that not only is social mood endogenous, but, as Prechter states: "... patterns of aggregate human behavior are self-causing, self-regulating, self-reinforcing and, to a far greater degree than has heretofore been imagined, predictable."
That's right, predictable, because the patterns in social mood follow a repeating, self-similar form known as a "fractal". In the case of social mood, this fractal is called a "robust fractal". In other words, the repeating form is self-similar but not identical, and has numerous variations that follow certain identifiable rules. These rules are part of what is known as the Elliott Wave Principle, the foundation for the science of socionomics.
Briefly, R.N. Elliott, while studying patterns in the stock market back in the 1930's and 40's, identified a repeating, self-similar form that followed certain identifiable rules. He formulated the Elliott Wave Principle based on his studies. Robert Prechter stumbled upon Elliott's published works and began using the Elliott Wave Principle to forecast movements in the stock market in the 70's. He enjoyed tremendous success and still does today. Fairly early into his work he observed that many areas of mass human activity displayed the Wave Principle, and he embarked on a journey to study this insight. Thus, today, we have the new science of socionomics.
I've presented a very brief and superficial explanation of the short history of socionomics, and I would encourage anyone who is interested to do some additional research for a more in-depth understanding of the Wave Principle and the science of Socionomics. The purpose of this blog is to apply the socionomic perspective to shed a different light on world events, and perhaps offer some insight as to why events are occuring as they do at this critical time in world history.
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