[Article] The Stock Market is not Physics – Part I
In the world of physics, action is followed by reaction. Most financial analysts, economists, historians, sociologists and futurists believe that society works the same way.
In the world of physics, action is followed by reaction. Most financial analysts, economists, historians, sociologists and futurists believe that society works the same way.
So in the face of abundant evidence to the contrary, why does the media (and much of Wall Street) still embrace the myth that news moves markets?
Professor Nofsinger reviewed all major investment legislation from the 1920s to present. He found that the character of each new investment law reflected the direction of the stock market prior to its enactment.
There is probably not one person in a million who would disagree with the conventional view, espoused everywhere, that the attacks of September 11, 2001 and the subsequent deliverance of anthrax-laced letters to individuals shattered the confidence of Americans. Yet that conclusion flies in the face of the facts.
Both supporters and critics of the Federal Reserve System agree that the first cause of paper money inflation and credit expansion in the U.S. since 1913 is the Fed. How does a socionomist respond to this assertion?
The Enron Scandal: A Case in Point. The socionomic insight is that the conventional assumption about the direction of causality between social mood and social action is not only incorrect but the opposite of what actually occurs.