March is said to come in like a lion, yet along with the nascent Chinese Year, it makes its entrance in 2010 as a tiger-- and a ferocious one at that. The month begins with global tempers high and violence on the rise, as the mood factors indicate a period of global destabilization and violence. It is likely that concerns with civil unrest and even terrorism are at extremes. Worries about geopolitical escalation should be elevated as well.

By the second week of the month, geopolitical escalation could well become a reality. There are indications of concerns during this period with resource availability, and the price of crude oil and other commodities could rise accordingly. Hoarding is a possibility.

As the mid-month point passes, the collective mood indicates a safety-seeking preference; economic losses are likely to accelerate with steep market declines possible. Concurrently, the human perception of the natural world signifies a high risk for event(s) of which losses of life and property are probable.

As the month comes to a close, global leaders are likely to be in panic mode as they attempt to keep up with the extreme pace of unfolding events. The U.S. government also shows indications of being in a crisis mode as it tries to forge a way forward. There should be an attempt to assess losses during this final period and for markets to make their best efforts to stabilize. While valiant attempts may be made throughout the month to catch this tiger by the tail, it’s sure to be a difficult, if not dangerous venture.

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The preceding was an excerpt from the March 2010 issue of MoodCompass. (current issue viewable by research sponsors only; reprinted with permission of A New Story Foundation)

Highlights: accelerating economic losses, social discontent, extreme interest in terrorism & global violence, and widespread natural "event(s)." A global mood "weather forecast" for March 2010.

In February, we begin to see a broad unraveling of the threads that hold the modern global system together. The Chinese economic bubble should finally begin to burst. In the West, social discontent runs high. International tension is extreme this month, and there are sides to be chosen. In the Middle East, look for Iran to go out of its way to display its military might to the rest of the world. The United States may be cornered into making a decision in the direction of aggressive or hostile action, as the rest of the world urges restraint. There is also a heightened interest in terror and terrorism.

To top it off, it may even feel like the natural world is against us, and what we need to maintain our way of life. Unseasonal weather may threaten agricultural outputs, or impede the continuance of business as usual. Tectonic events may encumber additional population centers besides the ones already hit last month in Haiti. It could be a difficult month to be a modern, globalized, civilized human being.

“When the next long term peak in optimism arrives, that will be the time to look for things to really begin to get bad!" (March 2009 MoodCompass, pg. 2). That peak occurred in January. This is evidenced by the ending of the stock market rally that began last March and the beginning of the next long decline—not only in the markets, but in economic, social and geopolitical stability. This is the new world dis-order, and should be for some time to come. If one has focused solely on amassing wealth in terms of dollars and property, one may be disappointed when much of their value is lost. Those who have been investing in relationships-- family and trustworthy friendships-- should find their investments substantially increasing in value over time; precious commodities that cannot be purchased at any price.
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The preceding was an excerpt from the February 2010 issue of MoodCompass. (current issue viewable by research sponsors only; reprinted with permission of A New Story Foundation)

Highlights for February: China economic bubble bursts, increased civil unrest, Iranian military escalation, heightened interest in terrorism. A global mood "weather forecast" for February 2010.

In 2009, world leaders put together a concerted effort to forestall economic catastrophe. They took the problems created by excessive consumption and overspending, and attempted to make them magically disappear through overspending and encouraging even more consumption. As the New Year begins, the bill comes due. The party’s over.

The global context changes drastically along with the turn of the calendar. There are clues to what causality we may assign to this, but it’s always difficult to name a context that has not yet been seen. Right around the New Year weekend, geopolitical issues rise significantly, the U.S. government appears weak or vulnerable, and the global system is perceived as breaking down. As the first week of the year begins, economic concerns rise sharply and U.S. government activity level rises. However, before connecting these dots prematurely, there are more clues to examine.

In the first week of the year and into the second, there is an elevated risk of extreme natural event(s) occurring. There are also global themes of national identity and isolationism. This would be the period with the highest likelihood for the Mayon volcano in the Philippines to erupt, or any of a number of related consequences. It would also be a time that Iran would be most likely to seriously flirt with regime change once again, which in turn could create havoc with the world’s energy supplies.

Overall, there is a global shift in mood from optimism that some sort of economic recovery is on the horizon, to one of extreme seriousness, helplessness, and apathy. Perhaps January is our introduction to the next decade. This next ten years should see an increase in scarcity, hoarding, and even wars over basic resources; and natural disasters on a scale we have never seen. The changes in our world will cause us to examine our values, and our lifestyles will surely change. January 2010 is likely only the beginning of a long and painful collapse of the world as we have known it. Welcome to 2010.
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The preceding was an excerpt from the January 2010 issue of MoodCompass. (current issue viewable by research sponsors only; reprinted with permission of A New Story Foundation)

Highlights for January: Global economic implosion, Chaos in Iran, Indian/Pacific Ocean region tectonic event(s). A global mood "weather forecast" for January 2010

When I see a configuration that signals an extreme change, such as the sudden shift in perception regarding inflation and view of the U.S. government mentioned in the previous post, I watch and wait to find out what actual event(s) might possibly correspond with this. The climax for such a shift, according to this month's MoodCompass should be early this week. While there has been a slight elevation in the frequency of discussions of inflation and the wide credit spreads, there has been little that could possibly interest the average American or world citizen. At such a moment as this, I must pause and wonder if something noteworthy will occur at all. However, part of the hazard of doing this forecasting work, especially with a tool as reliable as the MoodCompass has shown itself to be, is that when a high risk event configuration does appear to be near, I must resign myself to waiting for some kind of "shoe" to drop. The good news, I suppose, is that if a few more days go by with not much happening, I can let it all go, and completely focus on sipping eggnog with friends. May your holidays be bright, and of few "shoes" dropping.

The theme for the coming week is "unintended consequences." The developed world has been in the midst of a manic binge of overconsumption for quite some time. Just like with an individual person, prolonged extreme mania is often followed by a severe depression (after the extreme mania of the 1920's, the depression of the 1930's naturally resulted). World governments have done their best to forestall an economic depression by continuing to pump "stimulus money," the economic equivalent of adrenaline, into the global system. To not have done so would have been catastrophic. Yet, is it possible that they just traded in one set of problems for another? How long can one keep going on stimulants without some sort of breakdown? Should we expect anything less drastic from something as complex as the current world order?

The indications for the coming week are for an extreme surge in inflation concerns. While this could be a final surge before deflation sets in for a time, the strength of it could still be quite alarming, especially to those who pay attention to such things on a daily or weekly basis. The likely manifestations to go along with this are a sharp spike back up in gold, silver, and other commodities; a decline in the U.S. Dollar; a dramatic sell-off in U.S. Treasuries; and diminished confidence in the U.S. government, and the global system as a whole.

Dec. 14 - 20: Sharp sell-off in U.S. Dollars and/or U.S. Treasuries. Inflation concerns skyrocket. Global system appears to be breaking down. Diminishing confidence in the U.S government. (MoodCompass, Dec. issue, pg. 2).

Dec. 7 - 16: Directed Volatility, Outrage Violence is on the increase, and possible displays of discontent or civil unrest. (MoodCompass, Dec. issue, page 10).

There has already been a lot of skeptical press about the futility of Copenhagen. As desperate as the situation is, as serious as the threats are to the planet, there is little liklihood that any government will be willing to bear the political costs of actually insuring that the kinds of cuts required will actually be made. Climate activists and others who are aware of how serious the situation is, are feeling increasingly desperate.

The Copenhagen climate talks begin on Monday December 7. Social mood projections are for increased violence, protests, and civil unrest beginning on the same day. While outbursts of outrage could show up anywhere on the planet, I have to wonder whether these two factors will intersect in Copenhagen. If they do, will it help draw attention to the climate change problem, or will it only distract from the business at hand? Is there anything that anyone can do that will actually cause needed changes to take place? Important questions that need to be answered.

On the positive side, at least for Copenhagen, our social maps for the month show that increased violence or civil unrest is most likely in Mexico, the U.S., Pakistan and India. The risk is also somewhat elevated in Russia (we have already seen some of that this month). Best wishes for a fruitful and peaceful event to both delegates and protesters in Copenhagen.

Below is an except from this month's MoodCompass:
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Since September, the global mood has been in a process of peaking optimism within a larger downturn (that is still only just beginning). It has been difficult for many to truly believe in an economic recovery, but more and more have decided to embrace it whole heartedly. While efforts to keep the global consumption machine moving have been no less than heroic, they cannot much longer forestall the inevitable. Trying to spend one’s way out of a situation that resulted from over consumption and over spending in the first place is like trying to pick oneself up by one’s own boot straps. Eventually, the result is falling on one’s face. The topping process in the markets and the recovery is nearly complete. This month is a glimpse at some of the unintended consequences that have been purchased in an attempt to continue to keep the global wheels turning at an unsustainable pace.

Beginning with the second week of December, geopolitical concerns are on the rise. Key global players such as China and the United States may be less than cooperative with each other; Russia may be at odds with Eastern Europe; and we must not forget the wild cards—Iran and N. Korea which may add renewed trouble to the global balancing act at a moment’s notice. Displays of discontent or unrest are more likely on a global scale, and incidents of violence may be seen to be up as well. In the middle of the month, there are indications that inflation concerns will rise dramatically. This should be accompanied by either a sharp sell-off in U.S. Dollars, U.S. Treasuries, or both. Concurrently, confidence in the U.S. government will diminish, and there may be worries that the global system is breaking down. Immediately surrounding the Christmas holiday there may be some relief. However, as the New Year begins, geopolitical worries and systemic risks again come to the foreground as noteworthy threats to the fragile house of cards that have been so carefully stacked in place.

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http://anewstory.org/moodcompass.htm (current issue viewable by research sponsors only; reprinted with permission of A New Story Foundation)

The Global Mood "Weather Forecast" for December 2009. Increased global tension, U.S. Dollar or U.S. Treasuries sell-off, increased discontent or unrest, and west coast earthquake are the highlights.

The social mood configuration for next week infers a collective search for safety or an avoidance of risk taking. This has particular economic significance, as this configuration has not been seen since last February, before the big market rally that has been occurring since March.
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Excerpt from the November MoodCompass:

November 9 - 15: Market Meltdown. Safety seeking. Inflation concerns are replaced with concerns of deflation. Likely commodity sell-off and Dollar rise. U.S. centered economic crisis. Markets may decline sharply.
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From the Week by Week Highlights of Global Mood, Perception, and Behavior on Page 2 of the November MoodCompass: http://anewstory.org/markets/Nov09_MoodCompass.pdf (current issue viewable by research sponsors only; reprinted with permission of A New Story Foundation).

Below is an except from this month's MoodCompass:
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There is a sense of desperation to the month of November which is likely to challenge world leaders to find new and creative solutions to long standing problems. There are economic concerns that “stimulus” has not yet been able to make go away, and chronic geopolitical issues that continue to go unresolved. In the first half of the month, the primary focus is economic and currency issues. There may be one last big panic over the fate of the U.S. Dollar, after which it should continue to show new strength. As the seriousness of the economic situation begins to become clear, inflation worries will be replaced with concerns about deflation, and global markets could see a sharp, but likely brief, sell-off. The yet unresolved unemployment situation may require new and innovative responses from federal and state governments.

The focus shifts in the second half to the world arena. A polarization develops between “good guys” and “bad guys” (the identification of the good guys and bad guys would be in the eye of the beholder). There is a societal sense of righteousness and unity against an enemy or cause. While it would make sense that a specific event would cause such a response, there is no direct indication as to whether such an event is likely to occur or what it might be. Because there appears to be some relationship to this polarization with the energy markets, there is a good possibility that it involves Iran and possibly Russia.
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http://anewstory.org/markets/Nov09_MoodCompass.pdf (current issue viewable by research sponsors only; reprinted with permission of A New Story Foundation)

The global mood configuration for this next week indicates that it has the potential to be the most violent period this month. It might be of interest to watch the news this week to see how and where this manifests.

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Excerpt from the MoodCompass:

October 26 – Nov 1: Volatility. Resolution of global tension received as “bad news” (i.e. a negative event). Geopolitical concerns rise sharply. People are angry. Violence is increasing.
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From the Week by Week Highlights of Global Mood, Perception, and Behavior on Page 2 of the October 2009 MoodCompass: http://anewstory.org/markets/Oct09_MoodCompass.pdf (current issue viewable by research sponsors only; reprinted with permission of A New Story Foundation).

Many have been discussing the Dollar's demise.  There have been panic sell-offs of Dollars in the forex market, and U.S. Treasuries are being abandoned wholesale. Yet, this is the kind of extreme in sentiment that most often occurs at a market top or bottom. It's true that the U.S. government is borrowing unprecendented amounts of money. It's true that some countries including China, the U.S.'s primary creditor, is exploring alternatives in reserve currencies. However, as much as China, Russia, Iran, and other nations might wish there were another place to turn, the global system is intricately complex, and rests on a foundation based in debt and U.S. Dollars. Things can not safely change that fast. Also, as global anxiety climbs, and people are once again forced to liquidate assets that are primarily priced in Dollars, the U.S. currency will rise in value against the "commodity" currencies.

Even if there is still one more brief, but possibly extreme panic, holders of the U.S. Dollar will once again find their currency gaining in favor. Inflation worries will be a spector of the past, and deflation will once again be the primary concern. We've been here before. This is what it looks like at a social mood top, as markets in general begin to break down once again, and as Treasuries and the U.S. Dollar are sought as "safety." The Dollar may indeed collapse at some point, and inflation may very well soar to unbelievable heights as resources become more scarce. However, for now, and perhaps for some time to come, the Dollar may find support as the Great Recession continues to play out, and the spectre of Depression once again begins to lurk in the shadows.

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Excerpt from the October 2009 MoodCompass:

October 19 – 25: A Solution? U.S. government crisis resolved one way or another. U.S. Dollar declines sharply. Inflation concerns up sharply.

From the Week by Week Highlights of Global Mood, Perception, and Behavior on Page 2 of the October MoodCompass: http://anewstory.org/markets/Oct09_MoodCompass.pdf (current issue viewable by research sponsors only; reprinted with permission of A New Story Foundation).

October 5 – 18: Chaos. Civil unrest in the U.S. and elsewhere. World leaders try to maintain stability. Possible E. Asia event (Japan earthquake?). Stock market lower. U.S. Dollar stable, and likely up.
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From the Week by Week Highlights of Global Mood, Perception, and Behavior on Page 2 of the October MoodCompass: http://anewstory.org/markets/Oct09_MoodCompass.pdf (current issue viewable by research sponsors only; reprinted with permission of A New Story Foundation).

Below is an except from this month's MoodCompass:
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http://anewstory.org/markets/Oct09_MoodCompass.pdf (current issue viewable by research sponsors only; reprinted with permission of A New Story Foundation)

 

 

The Global Mood "Weather Forecast" for October 2009. Continued economic concerns, widespread civil unrest, and extreme Middle East tension are the highlights.