Friday, October 29, 2010

Superstition on the Ascent

Here is a headline straight out of Socionmic Theory for eras where mood is in a dominant negative phase:

Superstitious Beliefs Getting More Common
by Emily Sohn, DiscoveryNews
It's that time of year again. Ghosts, goblins and other spooky characters come out from the shadows and into our everyday lives.

For most people, the thrill lasts for a few weeks each October. But for true believers, the paranormal is an everyday fact, not just a holiday joke...

...trends in television programming offer a sense that there is a widespread interest in mystical phenomena that is becoming more common. In the 1970s and 80s, Bader said, there were maybe one or two paranormal-themed shows in the TV line-up. Today, there are dozens, including programs about ghost hunters, psychic kids, haunted homes and even possessed pets...

Expect more of this. Some of the coming rise in paranormal and "occult" activities that I expect to see will simply be individuals who have long held these beliefs finding a climate more conducive to airing these beliefs, while others "on the margin" will pick up these beliefs as a symptom of "magical thinking."

Plus, there are a number of fringe phenomena that I believe will be integrated into science once the negative mood phase is well underway, as conventional theories are found wanting in an age of anger and destruction of old paradigms.

Should be a wild ride. I'd brush up on my Crowley, Regardie and Lisiewski if I were you...

Tuesday, October 26, 2010

Another Anecdote of Doom

Here's another anecdote on the interest in "doomer" topics. Matt Savinar at Life After the Oil Crash has had forums up for years, discussing peak oil, financial instability, prepper actions and general doomer topics.

He's had to move the forum a few times recently because traffic is so high the boards crash. He put up a "disinvitation" to people last week - basically saying that if you need the forum just to find a "daddy" to make you feel better or answer all your questions the way you want to hear them, then you should not participate in the forum. Guess it wasn't enough to drive off business because Matt put this notice up yesterday:

Editor's Note: Future of the Forum
Am closing it, except for the meetup section, am working on archiving the old one. (When I take it out of maintanence mode, it still allows people to post and them "bammo" it crashes again.) Will have more tomorrow.

Wow. So much interest in a Peak Oil/Doomer forum that they continue to crash the boards, even on several different forum vendors. Folks are nervous out there.

Monday, October 25, 2010

Another Sign...

This weekend gave us a non-socionomic indicator that the Apocalypse must be right around the corner: Missouri 36 Oklahoma 27

Be afraid. Be very afraid.

Thursday, October 21, 2010

Socionomic Context on the Rare Earth Metals "War"

I'm sure you've seen some mention of China imposing export restrictions on "rare earth" elements that have become critical to many new energy and defense technologies. This issue has been discussed here at FutureJacked as well as in the Socionomist.

The Congressional Research Service produced a report on the rare earths and policy options entitled Rare Earth Elements: The Global Supply Chain. For policy wonks it is worth a read.

What I'd like to point out is the schizophrenic nature of the response to this supply issue/challenge/problem. Socionomics tells us that as this period of negative mood drags on, more restrictions will be put in place on capital and goods, more anger will be expressed in international relations and the superstructure of treaties and trading ties built up during the old Bull Market will be shredded. We are seeing the initial phases of this.

Options floated to this issue include challenging China through the WTO, supporting new mining operations in the U.S. and stockpiling.

The WTO option is based on the dying paradigm of harmonious international relations, wherein countries and societies saw integration into a larger and freer world economy would allow a rising tide of prosperity to lift all boats. If the socionomic thesis is correct and if we are in an era defined by negative sentiment, then one might expect any WTO action to fail - either by disappearing into bureaucratic swamp and fizzling out or by China refusing to allow the WTO to dictate their trade policy on this matter, preferring instead to divert that material into strategic domestic production instead of being a wholesaler to the West who then turn the material into value-added products.

Supporting new mining operations seems also at cross-purposes with negative mood. While the idea of home-grown mining of goods for "us" as a way of sticking it to "them" has an appeal, there are dramatic hurdles in place to building out new infrastructure in the face of the environmental policies put in place during the Bull era, back when we thought we could afford all sorts of extra costs on productive activity because we were all going to get rich, stay rich and buy cheap stuff from China. Home-grown production of rare earths will come to pass in the U.S., but not after ugly fights with environmental types, in my opinion.

Hoarding/Stockpiling will probably be the first option chosen. The defense stockpiles will be rebuilt based on whatever supply can be obtained whilst the legal battles over resuming production in the U.S. are fought. Hoarding/stockpiling is a natural reaction to uncertain times and probably will be implemented quickly.

Remember, we are still operating in a world structure built up and defined by positive mood beliefs. That structure is totally at odds with the growing negative sentiment. When/if we see the big collapse in mood once this delusional "I've got my eyes closed so the monster under the bed won't see me" phase breaks like bad fever, then the schizophrenic nature of trying to operate within a world economic system built for a dead era should come clear, and a trail of broken economies, ignored treaties, trade wars and eventually hot wars will follow.

Tuesday, October 19, 2010

Building a Better Sociometer

Socionomics has proven its worth over the last decade. As this discipline gains momentum, we continue to search for better and better mood meters. The equity markets have been excellent proxies and their use is well chronicled in socionomic literature.

Well, as the Communications/Informational Revolution continues to unfold and social networking reshapes how communication unfolds, a researcher from Indiana may have stumbled upon a way to gauge and monitor mood in near real-time:

Twitter Can Predict the Stock Market
by Lisa Grossman, Wired Science Blog
The emotional roller coaster captured on Twitter can predict the ups and downs of the stock market, a new study finds. Measuring how calm the Twitterverse is on a given day can predict the direction of changes to the Dow Jones Industrial Average three days later with an accuracy of 87.6 percent.

“We were pretty astonished that this actually worked,” said computational social scientist Johan Bollen of Indiana University-Bloomington. The new results appear in a paper on the preprint server...

This is some very exciting stuff. The correlations will somehow have to be tied back to Elliott Wave forms, I assume, but it is very encouraging that research continues to validate the socionomic premise, even when it isn't trying to.

The Great Game

I strongly suggest you read Charles Hugh Smith's recent blog post on Oil, China and his reading of Global Geopolitics:

The Great Game: Geopolitics and Oil
Geopolitics is not called The Great Game without reason. The game of dominating the world's resources, nation-states and alliances is like a combination of Go and chess, with the threat of military conquest or defeat always hovering over the statecraft and financial game...

I recommend the article for two reasons. One, because I think it is a cogent analysis of how power really works (and because I agree with him on the expectations of a coming collapse in oil prices - a "head fake" that few are expecting) and because it reveals quite a number of silver linings in the stormclouds that seem to crowd the horizon.

We often dwell on the absurdities and negative aspects of the USA's current position in the world. Mr. Smith's article is a good reminder that there is still a firm base upon which to build a better country once the Great Collapse reaches its howling end point.

Monday, October 18, 2010

Multiculturalism Has Failed?

Pardon the long silence here at FutureJacked lately. I was in Europe for nearly two weeks on business. Glad to be back, though this lingering plateau of tension in mood and markets is getting old - not the Mr. Market cares what I think.

Speaking of Europe, negative mood continues to build up under the brittle facade of happy talk. Prime Minister Merkel now gets on board by taking a shot at one of the sacred cows of the last 30 years - the multicultural society. Actually, I might argue that this particular cow has been sacred since the end of World War II. Socionomics marches on:

Merkel says German multicultural society has failed
from the BBC
Attempts to build a multicultural society in Germany have "utterly failed", Chancellor Angela Merkel says.

She said the so-called "multikulti" concept - where people would "live side-by-side" happily - did not work, and immigrants needed to do more to integrate - including learning German.

The comments come amid rising anti-immigration feeling in Germany.

A recent survey suggested more than 30% of people believed the country was "overrun by foreigners..."

Oh my. And to have this come from Germany, which is normally more sensitive to this kind of thing. Actually, I heard a similar sentiment from a few conversations I had with people in Germany and Austria both.

Another trend to watch.

Wednesday, October 6, 2010

Imagine the Coming Reaction

Icelanders took to the streets recently to vent their anger over the continuing economic collapse of their island nation.

Iceland's politicians forced to flee from angry protesters
by Jill Treanor, The Guardian
Protesters took to the streets of Reykjavik today, forcing MPs to run away from the people they represent as renewed anger about the impact of the financial crisis erupted in Iceland.

The violent protest came amid growing fury at austerity measures being imposed across Europe. Disruption in more than a dozen countries this week included a national strike in Spain and a cement truck driven into the Irish parliament's gates.

Witnesses said up to 2,000 people caused chaos at the state opening of the Icelandic parliament, with politicians forced to race to the back door of the building because of the large number of protesters at the front. Eggs were said to have hit the prime minister, Jóhanna Sigurðardóttir, other MPs and the wife of the Icelandic president, Ólafur Ragnar Grímsson.

Árni Páll Árnason, the minister of economics affairs, who was caught up in the protests, said: "We have a difficult economic situation and this is something to be expected in a democratic country..."

I want to draw your attention to the bolded sentence from the Guardian story above. At least a segment of the Icelandic political elites, after getting pelted with eggs and shouted down by protesters, just shrugged it off and chalked it up to the cost of doing business as a democracy.

Think for a moment what Congress would have done had the same thing happened here in the Land of the Free. With the exception of Ron Paul, what would the response had been? Mass arrests? A new set of names on the "No Fly List?" Protestors being tasered left and right, flopping like dying fish on beach? Can you imagine members of Congress or Senators just blowing it off, basically saying they understood the anger and it was unfortunate?  Ten bucks says the word "terrorist" would have been used fifty times in the first five minutes of a press conference if a political elite had been struck by an egg.

Little anecdotes like this matter, in my opinion, as they can help forecast the flavor of the times to come. Socionomics gives us the broad strokes and tenor of the times, but individuals and societies still have a choice of how to respond to the mass negative mood.

Iceland has chosen to at least attempt to keep a civil government that is somewhat responsive to the People. In the U.S. we only need look back to 9/11 to see where our choices have landed us.

Imagine a President who came out and, instead of telling the country to be scared and hide and let the military do all the heavy lifting, the President and leadership had hearkened back to the mindset of World War II and told people to be strong, be prepared for hardship and that tough choices would have to be made, especially on things such as our dependency on foreign oil.  And then that President had actually made hard choices - not to kill or invade, but on how we in the U.S. use energy, how we fund out government, how we crush our businesses with regulatory burdens and how we plan to fund the coming Baby Boomer retirements - all of which help inform the decision to stay in the Middle East, which was one of the drivers of that tragedy.

Then imagine that the big playerz in the Federal Reserve had championed austerity and balance sheet repair back in 2001 instead of encouraging people to lever up and go out and buy and SUV?

Imagine that instead of invading Iraq, that $1 trillion had gone into fifty new nuclear power plants, into massive new wind farms and into restructuring the U.S. auto fleet for all-electric or hybrid electric vehicles? Where would we be today?

I realize that wishful thinking and speculation can't overcome the fact that we have the government we deserve and, frankly, probably the government ordained by the precarious position of the waves of social mood that have brought us to this point. While acknowledging that socionomics has a deterministic feel to it, my interpretation remains that individuals can make choices that have significant impacts, not just on your personal lives but on society at large. Your choices and behavior matter, especially in times of stress. Remember that in the days and years to come.

I have a bad feeling we are going to get to see the difference between Icelandic elites faced with protesters and U.S. elites faced with protesters all too soon.

FYI, I will be out on travel for the next couple of weeks. I'll try posting from the road, but no promises.

Monday, October 4, 2010

More Mortgage Mess

Please check out this recent post by Karl Denninger over at The Market Ticker. It links over to a very long document that will interest those of you who have your JD. Even for those of us non-lawyers, it makes a fascinating read:

MERS/MBS/Foreclosure Goes RICO
...[W]ithout standing [REMICs] can't foreclose, but then we get back to "who can?" And what we find is that the originator was paid, and thus they can't either. Worse, for those originators that are bankrupt, their "assets", such as they are, can't go anywhere without a bankruptcy trustee's signature, and further, even if someone was to acquire that, which nobody has, THE REMICs CAN'T TAKE THE PAPER ANYWAY AS THEIR CLOSING DATE HAS EXPIRED.

So we have a bankrupt originator who was paid in full and can't foreclose, and we have a note that can't be transferred into the REMIC without destroying its tax preference (retroactively, incidentally), which instantaneously trashes the value of the MBS - probably by more than they could hope to recover if they were going to take the note anyway...

Another fistful of sand is about to be thrown into the gears of real estate commerce - and the associated Mortgage Backed Securities. Fugly.

Friday, October 1, 2010

Mortgage Market Breakdown

The fraudulent practices and obscene degradation of underwriting practices that metastisized during the mortgage markets during the Housing Bubble powered by the delusional positive mood from 2002 - 2008 are unraveling, just as mood is unraveling:

Foreclosures Slow as Document Flaws Emerge
The foreclosure machinery that has forced millions of Americans out of their homes is beginning to seize up as some lenders and their lawyers are accused of cutting corners in their pursuit of rapid home repossessions...

...[O]ne of the major title insurance companies, Old Republic National Title, has sent a bulletin to agents saying that “until further notice” it would not insure title to properties foreclosed upon by GMAC Mortgage, the country’s fourth-largest home lender and one of the two big lenders at the center of the current controversy.

GMAC declined to comment, and Old Republic representatives did not return calls.

GMAC has acknowledged legal missteps in processing mortgages, and JPMorgan Chase has acknowledged the possibility of missteps, and both have suspended all foreclosures in the 23 states where they need a court’s approval. That’s 56,000 in the case of Chase alone; GMAC declined to provide a number...

If title insurance dries up and stays that way, we will have ourselves one hell of a trainwreck on our hands.

Bull Market Heroes get eaten by the Bear. The stock market. Warren Buffett his ownself. Computers. Now Housing (back for another round in the meatgrinder). Note the common thread - fraud and corruption leading to mistrust and the breakdown of the complex systems that are founded on trust and an assumption that the rule of law is in force and that the playing field is level. This Great Bear market will trash the concept of trust, gut the happy unicorns of the belief that "the authorities are not corrupt" and blacken the rainbows of naive gullibility in "modern" underwriting practices.

This is almost as sadly funny as the report the SEC just released, blaming the flash crash on Waddell & Reed for selling a block of 75,000 e-minis. They need to have a coupon for a bottle of Crown Royal on the front of that report, so that anyone reading it can get tanked before getting to far in - that is the only way you could possibly believe the story the SEC is telling there.

These are signs of a schizophrenic system. Crazy systems, like crazy people, can be dangerous to those in the general area. Be aware.