Social Mood Conference  |  Socionomics Foundation
By Alan Hall, originally published in the May 2011 Socionomist

The list that follows shows six results of the two-year positive mood trend as of April 2011.

Economic activity has rebounded. The Conference Board Leading Economic Index for the U.S. is up 17% since March 2009. The index is based on 10 variables, including the University of Michigan’s Consumer Sentiment Index, the S&P 500, and the Census Bureau’s monthly report on building permits.

Unemployment is down slightly from its recent high of 10%. The number of hours worked is up.

People are borrowing and lending money again. Total Credit Market Debt has nearly regained its March 2009 all-time high level, while the National Association of Credit Management’s poll index, which measures economic optimism, has moved back into optimistic territory. Fear of credit risk has fallen, as evidenced by corporate bond yields, which are down from 25% to 7.7% since November 2008.

Foreclosures and defaults have slowed. U.S. home foreclosures [Bloomberg HOMFDEF Index] have dropped 56% since April 2009.

Economists are more relaxed and confident. As you can see from the headlines in Figure 6, economists were a bundle of nerves near the social mood low in February-March 2009, but brimmed with confidence in April 2011. In fact, this April 21, 2011 headline suggests that punitive focus has shifted to a new type of target, the harbinger of doom: “Wall Street Economists Question Nouriel Roubini’s Predictions and Investment Advice.” Roubini predicted the current housing crisis and continues to remain cautious about prospects for economic recovery.

Figure 6

The drug war re-escalates. The July 2009 issue of The Socionomist showed that society tends to enforce drug laws in bull markets and tolerate drug use in bear markets. In late April, U.S. and Mexican officials met to increase joint efforts to halt the increasingly violent cross-border drug trade.■


Socionomics InstituteThe Socionomist is a monthly online magazine designed to help readers see and capitalize on the waves of social mood that contantly occur throughout the world. It is published by the Socionomics Institute, Robert R. Prechter, president; Matt Lampert, editor-in-chief; Alyssa Hayden, editor; Alan Hall and Chuck Thompson, staff writers; Dave Allman and Pete Kendall, editorial direction; Chuck Thompson, production; Ben Hall, proofreader.

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Most economists, historians and sociologists presume that events determine society’s mood. But socionomics hypothesizes the opposite: that social mood regulates the character of social events. The events of history—such as investment booms and busts, political events, macroeconomic trends and even peace and war—are the products of a naturally occurring pattern of social-mood fluctuation. Such events, therefore, are not randomly distributed, as is commonly believed, but are in fact probabilistically predictable. Socionomics also posits that the stock market is the best available meter of a society’s aggregate mood, that news is irrelevant to social mood, and that financial and economic decision-making are fundamentally different in that financial decisions are motivated by the herding impulse while economic choices are guided by supply and demand. For more information about socionomic theory, see (1) the text, The Wave Principle of Human Social Behavior © 1999, by Robert Prechter; (2) the introductory documentary History's Hidden Engine; (3) the video Toward a New Science of Social Prediction, Prechter’s 2004 speech before the London School of Economics in which he presents evidence to support his socionomic hypothesis; and (4) the Socionomics Institute’s website, www.socionomics.net. At no time will the Socionomics Institute make specific recommendations about a course of action for any specific person, and at no time may a reader, caller or viewer be justified in inferring that any such advice is intended.

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