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Social Mood Theory Says Eric Cantor's 'Surprise' Defeat Is No Surprise at All
We're beginning to see the consequences of Main Street underconfidence.
Peter Atwater    

This article originally appeared on Jeff Cooper's Daily Market Report. To get Jeff's commentary plus day and swing trading ideas each day, take a FREE 14-day trial to Jeff Cooper's Daily Market Report.

Two quick observations on Eric Cantor's surprise defeat this morning.
 
That a candidate like Mr. Cantor was defeated was not at all a surprise to me. When confidence is low Main Street votes out incumbents and seeks candidates further to the extreme. My friend Alan Hall did a great socionomic study on this behavior. There's also evidence of it in the Greek elections; when confidence was at an extreme low, the extreme consequences affected both the left and the right.
 
Second, the defeat of an incumbent like Mr. Cantor when the equity markets are at a record high is extremely unusual. Rising markets typically reflect rising social confidence and a move to the middle and the overwhelming re-election of incumbents.
 
That Mr. Cantor was defeated, particularly in what one would normally consider to be a high-confidence state like Virginia right now, is extremely bearish to me.  

Having written exhaustively on inequality, I feel Mr. Cantor's ouster suggests that the consequences of Main Street underconfidence are now manifesting in action.

Peter Atwater's groundbreaking book "Moods and Markets" is now available on Amazon and Barnes & Noble.
 
"Peter Atwater brilliantly provides a framework for understanding both the socioeconomic hubris that led to the great credit bubble of the past decade and the dark social-psychological hangover that has resulted from its collapse. In so doing, he offers an invaluable guide to what promises to be a very difficult and turbulent period ahead as we experience what he calls the 'me, here, and now' behavioral tendencies of the post-crash world."  -Sherle R. Schwenninger, Director, Economic Growth Program, New America Foundation


Twitter: @Peter_Atwater
 
 
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Author holds positions in SH, JPM and SLV.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Social Mood Theory Says Eric Cantor's 'Surprise' Defeat Is No Surprise at All
We're beginning to see the consequences of Main Street underconfidence.
Peter Atwater    

This article originally appeared on Jeff Cooper's Daily Market Report. To get Jeff's commentary plus day and swing trading ideas each day, take a FREE 14-day trial to Jeff Cooper's Daily Market Report.

Two quick observations on Eric Cantor's surprise defeat this morning.
 
That a candidate like Mr. Cantor was defeated was not at all a surprise to me. When confidence is low Main Street votes out incumbents and seeks candidates further to the extreme. My friend Alan Hall did a great socionomic study on this behavior. There's also evidence of it in the Greek elections; when confidence was at an extreme low, the extreme consequences affected both the left and the right.
 
Second, the defeat of an incumbent like Mr. Cantor when the equity markets are at a record high is extremely unusual. Rising markets typically reflect rising social confidence and a move to the middle and the overwhelming re-election of incumbents.
 
That Mr. Cantor was defeated, particularly in what one would normally consider to be a high-confidence state like Virginia right now, is extremely bearish to me.  

Having written exhaustively on inequality, I feel Mr. Cantor's ouster suggests that the consequences of Main Street underconfidence are now manifesting in action.

Peter Atwater's groundbreaking book "Moods and Markets" is now available on Amazon and Barnes & Noble.
 
"Peter Atwater brilliantly provides a framework for understanding both the socioeconomic hubris that led to the great credit bubble of the past decade and the dark social-psychological hangover that has resulted from its collapse. In so doing, he offers an invaluable guide to what promises to be a very difficult and turbulent period ahead as we experience what he calls the 'me, here, and now' behavioral tendencies of the post-crash world."  -Sherle R. Schwenninger, Director, Economic Growth Program, New America Foundation


Twitter: @Peter_Atwater
 
 
< Previous
  • 1
Next >
Author holds positions in SH, JPM and SLV.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
More From Peter Atwater
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Social Mood Theory Says Eric Cantor's 'Surprise' Defeat Is No Surprise at All
We're beginning to see the consequences of Main Street underconfidence.
Peter Atwater    

This article originally appeared on Jeff Cooper's Daily Market Report. To get Jeff's commentary plus day and swing trading ideas each day, take a FREE 14-day trial to Jeff Cooper's Daily Market Report.

Two quick observations on Eric Cantor's surprise defeat this morning.
 
That a candidate like Mr. Cantor was defeated was not at all a surprise to me. When confidence is low Main Street votes out incumbents and seeks candidates further to the extreme. My friend Alan Hall did a great socionomic study on this behavior. There's also evidence of it in the Greek elections; when confidence was at an extreme low, the extreme consequences affected both the left and the right.
 
Second, the defeat of an incumbent like Mr. Cantor when the equity markets are at a record high is extremely unusual. Rising markets typically reflect rising social confidence and a move to the middle and the overwhelming re-election of incumbents.
 
That Mr. Cantor was defeated, particularly in what one would normally consider to be a high-confidence state like Virginia right now, is extremely bearish to me.  

Having written exhaustively on inequality, I feel Mr. Cantor's ouster suggests that the consequences of Main Street underconfidence are now manifesting in action.

Peter Atwater's groundbreaking book "Moods and Markets" is now available on Amazon and Barnes & Noble.
 
"Peter Atwater brilliantly provides a framework for understanding both the socioeconomic hubris that led to the great credit bubble of the past decade and the dark social-psychological hangover that has resulted from its collapse. In so doing, he offers an invaluable guide to what promises to be a very difficult and turbulent period ahead as we experience what he calls the 'me, here, and now' behavioral tendencies of the post-crash world."  -Sherle R. Schwenninger, Director, Economic Growth Program, New America Foundation


Twitter: @Peter_Atwater
 
 
< Previous
  • 1
Next >
Author holds positions in SH, JPM and SLV.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
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