A History of Socionomics

Apr 28, 2012 | Uncategorized

The essence of the socionomic hypothesis is that fluctuations in social mood—waves of optimism and pessimism—are a natural result of human association and have consequences in social action. Social mood is not conscious, rational and objectively reactive but unconscious, non-rational and subjectively active. While people almost universally believe that the character of social events determines social mood, socionomics recognizes that the causality is the reverse: social mood determines the character of social activity. The causality of social mood is unidirectional; there is no feedback loop of events back to social mood. Events do stimulate brief emotional reactions, but they are transient and independent of social mood.

Some forums of activity are ideal for the immediate expression of social mood. The one in which the most detailed and pristine data exist is the stock market, where investors in the aggregate buy and sell stocks almost immediately to express changes in their mood. Other activities, such as the music people choose to hear and the clothes they choose to wear, might serve as equally good “sociometers” if accurate data were available.

Many actions taken in response to trends in social mood take time to manifest. For example, business people might decide, in expressing the social mood, to expand or contract operations. But it takes time to implement such plans, so changes in macroeconomic activity lag changes in the stock market. The same is true of political actions, which generally require a large consensus and thereby substantially lag social mood trends. This is why sociometers such as the stock market averages are leading indicators of macroeconomic trends and political actions.

Robert R. Prechter Jr. postulated socionomic theory in the 1970s. Prechter has written two books explaining the theory and with colleagues has written academic papers deriving from socionomics. In 2010, mathematician John Casti released a book on the topic titled Mood Matters. The Socionomics Institute hosts annual conferences, featuring speakers from academia and the professions.

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Courtesy of the Socionomics Institute, www.socionomics.net

<a href="https://ugc.net.au/author/joel/" target="_self">Joel Hewish</a>

Joel Hewish

Joel is the founder and CEO of UGC. He is a licensed financial advisor with 15 years experience assisting clients grow, manage and protect their wealth.

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