Listening to Dr. Johan Bollen’s interview from Elliott Wave International, he makes a good point that fundamental analysis doesn’t move the financial markets.
Socioeconomics and James Dines murmuration theory is , in my opinion, the same thing. A murmuration is the collective noun for Flocking Starlings, I wrote about it not too long ago and you can see this theory play out in the financial markets without looking very closely at it. The fascinating thing about a flock of Starlings is, when one decides to change course, the whole flock changes course and you end up with all kinds of patterns.
James Dines cites an amazing video of their coordinated swarming that has gone viral. He headlines his just-published 2012 annual forecast issue “The Coming Worldwide Murmurations”. He says that the markets, and even social movements, are driven by similar, not very well understood principles of collective dynamics. He sites the spontaneous, unexpected uprising of the “Arab Spring” and predicts parallel developments in China, possibly fuelled by Uighur resentment, and in the U.S.
“One topic we’ve seen nowhere else in the world’s press is that of a possible revolution in America, a country in which many people have guns. We might be the first to dare to say that publicly, but we have never feared being first to tell the truth, because a cat in gloves catches no mice.”
James Dines has been in the business of making bold calls for over 50 years.
Simply put, he sees the excessive credit in the financial system as having placed the global economy on a collision-course with hyperinflation.
You want to invest in assets that can’t be printed away by government desperation. You want to hold hard assets; “wealth in the ground” as Dines says (physical commodities, mining companies, etc). They’re your best bet to make money at a rate faster than inflation.
Politicians hope to be safely dead by the time IT hits the fan.
Well, there you have it, Socioeconimcs and a Murmuration. Both theories are basically the same, people (animals) like to herd. It’s a safety mechanism that helps us survive.
Herding is what has made human kind flourish and prosper, but there is only one catch.
It doesn’t work in the markets. If you want to make money in the markets, you have to be by yourself, PERIOD.