Misleading Beliefs

"The most important part of this story is getting our minds to accept reality without our passionate beliefs interfering. By ‘beliefs’ I mean statements like these:
•“Things always get better and are never as bad as they seem.”
•“If Peak Oil were ‘real,’ I would be hearing about it from my trusted sources.”
•“Dwelling on the negative is self-fulfilling.”
While each of these things might be true, they also might be false and therefore misleading, especially during periods of transition. Our job is to remain as dispassionate and logical as possible."
Chris Martenson

Darkness On The Edge Of Town

This coming November, Bruce Springsteen will release "The Promise: Darkness On The Edge Of Town".  It's six hours of film and more than two hours of audio across 3 CDs and 3 DVDs including a documentary on the making of the album "Darkness On The Edge Of Town".  As a 30 year Springsteen fan, I anxiously await its release.

Over the years, Robert Prechter of Elliott Wave International has made some great comparisons between mass social mood, financial markets, and the mood of music and movies.  He's presented exhaustive analysis on how music and movie themes align with the mass social mood of the people.  As I was reading articles about Springsteen's upcoming re-release of "The Darkness" record, I started to wonder how the timing of both releases would present itself in relation to the financial markets.

"Darkness was an angry record. I took the 10 toughest songs I had.I didn't want something with a broader, more compassionate overview. That didn't feel right to me."
Bruce Springsteen (Interview with Edward Norton at the Toronto International Film Festival, Sept. 2010)

The chart below presents the Dow Jones Industrial Average Gold Ratio with the two dates for the release of "Darkness On The Edge Of Town".  My hypothesis proves to be true.  Both releases align with a downward trending cycle.

Dow Jones Industrial Average Gold Ratio



DARKNESS ON THE EDGE OF TOWN

They're still racing out at the Trestles,

But that blood it never burned in her veins,
Now I hear she's got a house up in Fairview,
And a style she's trying to maintain.
Well, if she wants to see me,
You can tell her that I'm easily found,
Tell her there's a spot out 'neath Abram's Bridge,
And tell her, there's a darkness on the edge of town.
Everybody's got a secret, Sonny,
Something that they just can't face,
Some folks spend their whole lives trying to keep it,
They carry it with them every step that they take.
Till some day they just cut it loose
Cut it loose or let it drag 'em down,
Where no one asks any questions,
or looks too long in your face,
In the darkness on the edge of town.
Some folks are born into a good life,
Other folks get it anyway, anyhow,
I lost my money and I lost my wife,
Them things don't seem to matter much to me now.
Tonight I'll be on that hill 'cause I can't stop,
I'll be on that hill with everything I got,
Lives on the line where dreams are found and lost,
I'll be there on time and I'll pay the cost,
For wanting things that can only be found
In the darkness on the edge of town.

P.S. Happy Birthday Bruce!

First Edinburgh, Now Nigeria

In my October, 2009 post, "Witches In Edinburgh", I made the point that "witch hunts" occur much more often during the downward spiral in mass social mood. Currently we're hunting Muslims, Mexicans, politicians, hedge fund managers, and witches in Nigeria!

 Children abused, killed as witches in Nigeria
By Christian Purefoy, CNN
"Sam runs Child's Rights & Rehabilitation Network, or CRARN -- an orphanage that supports nearly 200 children. All of them were accused of witchcraft and cast out by their families, often after being tortured. The orphanage provides security, healthcare, nutrition and counseling.  'A child witch is said to be a witch when that child possessed with certain spiritual spells capable of making that child transform into cat, snake, vipers, insects, any other animal and that child is capable of wreaking havoc like killing of people, bringing diseases, misfortune into the family,' Sam said.  When a child is accused of being a witch -- that child is hated absolutely by everybody surrounding him so such children are sent out of the home... But unfortunately such children do not always live long. A lot of them, they're either killed, abandoned by the parents, tortured in the church or trafficked out of the city."

Fortunately for our energetic little boys, we only give them Ritalin!

"Most Americans are Christian, and most don't have much direct exposure to Muslims. A quarter of Americans say they know 'nothing at all' about Islam, the Pew Research Center found earlier this month, and of non-Muslims polled, 58 percent said they don't know any Muslims.  It's natural for people who don't know Muslims to draw strong stereotypes from Sept. 11 and feel them reinforced by recent scares such as the Fort Hood, Texas, shootings and the Times Square bomb plot, said Leonie Huddy, the president of the International Society for Political Psychology and a political scientist at the State University of New York at Stony Brook.  'One of the things we know about cross-relationships of any kind is they become more positive as people have more personal contact with each other,' Huddy said.  A Gallup survey last year found that Americans who don't personally know any Muslims were twice as likely to acknowledge "a great deal" of anti-Muslim prejudice. Republicans and those without college educations tend to be less favorable toward Islam."

 "Xenophobia continues to rise at an alarming rate. I would hope that someone would do the research to show that out of the past 20 similar events, none of the gunslingers were Muslims. We might be shocked to find out that many of these murderers claimed Jesus Christ as their Savior."
Random Roving, "The Man Under The Hood", November 6, 2009

Fear, Uncertainty, and Doubt

"Fear, uncertainty and doubt will remain as long as consumers and executives lack confidence in the economic outlook of the United States. The psychological affect of the FUD factor remains a major hurdle to overcome. So far, everyone fears the worst, is uncertain about the future and doubts much can be done to make the situation better. We are in for a slow growth economy for some time. As investors we need to adjust our sails to deal with these difficult conditions."
Hans Wagner, CEO, Trading Online Markets LLC

Mass Social Mood Model

You Are Here

Maybe it's the "geologist in me", but when I'm touring somewhere I always love the map with the "you are here" arrow. It quickly gives you a reference point and spatial context. Now sometimes on a long hike, I hate those maps because they quickly inform you that your current location is far from your ultimate destination!

I've presented the chart below several times. I was reviewing it again this morning and find the quotes from President Hoover so interesting. Was he in denial, dishonest, or a good leader attempting to keep the sheeple from stampeding. I don't know. I would guess that he was "in the know" and was attempting to stop the stampede. Unfortunately herding mammals move "in mass" and one individual usually can't stop the stampede.

I've annotated the chart with my own "you are here" arrow. I've referred to what I call the "head fake" before. On October 8, 2009 I made a detailed post on the topic and that prediction was dead on. The last market rally was exactly that. It lures us back it. The "Kool-Aid" was poured for one last drink. I believe that the final sprint has occurred.

Unfortunately for our 401-k's, but fortunately for mankind's future, I believe that we are in a downward slide until at least 2012. A likely bottom might even be in 2016. But, at the bottom, we experience our "great awakening". Stayed tuned mon amis.

Political Leopards

Specter, the "political leopard", became the latest victim of the downward trending mass social mood.  You can run, but you can't hide from the angry mob.  It appears that the media is starting to understand the concept of "mass social mood".

ALLENTOWN, Pa. — "Centrism and just plain survival made Arlen Specter part of the nation's political fabric for nearly half a century, his cancer-fighting, party-switching story as much about evading death as writing laws. But the very adaptability that helped Specter, 80, endure turned politically fatal Tuesday, when the Democrat-turned-Republican-turned-Democrat lost his party's Pennsylvania primary. His defeat raised a painful truth: He could not have won a sixth Senate term as a member of either party given the anti-incumbent mood of 2010."
Source: Associated Press

On a related note, Ron Paul's son, Dr. Rand Paul achieves victory in Kentucky.  Is this a sign that Ron Paul could make a strong run in 2012??

The Emerging Shift

More from the interview with Long Wave master, David Knox Barker:


"Human psychology drives the cycles and there are trends in psychology. For instance, if you look at the 1970s to early ‘80s and the force that brought Ronald Reagan into office, it was a seasonal change in the long wave. It was a shift from the Roosevelt era of the 1930s of “The government should go out and save me from the economic forces” to “Let the free market take care of itself.” Then with Obama we saw a shift back to the idea that the government needs to step in and control the markets. A lot of the psychology you see is manifested in political trends. In the 1930s we gave the New Deal a chance. I talked in about that in the 1995 edition of my book, that fact that we’d probably see a global version of the New Deal proposed during the present crisis. And sure enough that’s exactly what was proposed [during the credit crisis of 2008]. The fact that people are even talking about a global New Deal is a sign that the psychology has radically changed. The socialists are excited because they think we’re headed in that direction, but I think they’re in for a major disappointment. I think we’re heading for a shift [in psychology] to a degree larger than the previous shift in political psychology. I sincerely believe the Tea Party movement is an early manifestation of this emerging shift, which I believe will be toward the Great Republic."

Read the entire interview:
http://financialsense.com/editorials/droke/2010/0415.html