Ready for a Greater Depression?

It's normal for markets to disconnect from collective mood at major turning points, especially when turning in a negative direction. This is exactly what has been occurring for the past month or so. However, the extremity of the current disconnect is quite unusual, and implies a vulnerability to destabilization in the markets unlike anything we have ever seen. Imagine the crash potential as a loaded spring, waiting for the slightest nudge to set it off. Anything could do it: a terrorist attack, geopolitical tension or escalation, a natural disaster, or even simply that the market is "overbought." Compare the current crash potential (see chart) to the crash potential just before the sharp September/October 2008 sell-off.


The likelihood of an extreme market sell-off, or crash event, before the end of the year continues. While it is conceivable that some artificial mechanism could continue to prop up the stock market, the most likely scenario, the path of least resistance, is for the pressure of this wide gap to be relieved.

Everyone has heard of the 1929 stock market crash. What most people don't realize is that the really big losses came after the initial recession and recovery-- the 1930's were the era of the Great Depression. While Main St. may have little remaining interest in the stock market directly, the growing spectre of a Greater Depression should at least give people pause. What will our culture of individuality and independence do in the face of 20% plus unemployment? Will we find the means to adapt to a period of chronic economic slowdown and decline? There is every indication that this is the direction we are heading. Ready or not...

High Terror Risk Alert - Oct / Nov 2010: Video

High Terror Risk collective mood configuration appears late October - early November 2010. Technical presentation of mood cycles illustrates.

October 2010 – Tempers, Tantrums, and Twisters

People are sick and tired of bad news and empty promises. There is talk of an economic recovery and a recession being over, but things still look as shaky and uncertain as ever. They don’t trust their governments to fix things, but no one seems to know exactly what to do. As collective mood continues to sink, governments focus on stimulating “the economy” and encouraging consumption. With governments treating symptoms, and not the larger problems much too inconvenient to publicly name and face, their interventions only forestall the inevitable. The rubber band will surely stretch as far as it can possibly go. When it does finally snap, it will not be pretty.

With frustration high, and tempers fragile, watch for increasing frustration to be expressed in rallies and protests. There will likely be heightened interest in the subject of terrorism. The geopolitical scene could be tricky, as global leaders are caught in the same sea of frustration and impatience as everyone else. Key hot spots to watch this month are Iran, Venezuela, N. Korea, and Nigeria. China is more likely than ever to make any attempted diplomatic solutions through the United Nations nearly impossible.

So how might October’s unfriendliness show up in the natural world? With a lot of energy in the system, cyclones are a high risk, even at this late date in the season. Tornadoes and typhoons may not yet be done for the year in the northern hemisphere. The southern hemisphere is not likely to see the cyclones, but they could have their own version of storm to share in the global moment.

The above is an excerpt from the October 2010 issue of MoodCompass, a publication of A New Story Foundation. To view the latest projections related to human perception of the natural world, see Earth Cycles.

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Addendum-- Tempers, Tantrums, and Twisters in the News:

10/1/10: The Twister of 2010

10/2/10: Violent protests after Dutch outlaw squatting

10/5/10: Bible college student shot dead in dorm room.

10/6/10: IMF warns against currency wars. 25 NATO Fuel Tankers Torched.

10/7/10: Deadly blast hits famed Sufi shrine in Pakistan.

10/8/10: Man dressed in black with jack-o'-lantern opens fire at elementary school in Carlsbad, CA.

10/9/10: 8 year-old stabbed while playing video games by stranger.

10/13/10: Continuing French Strike, Unions vs. Sarkosy may result in fuel shortages

10/15/10: Greece: Police clash with protesters at the Acropolis.

Woman in anger management class stabs classmate

10/16/10: Thousands protest in both China and Japan over disputed islands.

10/17/10: Off duty police detective killed over parking space dispute.

10/19/10: Gunman, suicide bomber attack Chechnyan parliment

5 shots fired at Pentegon, shattering windows.

10/20/10: France in turmoil as strikes continue

10/21/10: Major N. California mall set ablaze by man w/ possible bomb.

10/29/10: North, South Korea soldiers exchange gunfire at DMZ.

More shots at Marine Museum in evolving sniper case.

Shooting at Walmart by ex-employee.