The collision of global markets and social mood

Thursday, December 26, 2013

Bieber Retires (And Why It Matters To The Market)

Justin Bieber debuted in 2009. He just announced his "retirement." If it's for real and not a publicity stunt, it could have ramifications for the markets.

Justin Bieber and the markets? Yes.

Keep your eye on Lady Gaga too, who also came to fame during the 2008-2009 period. Lately she seems to be at about 0:14:59 on the Fame Clock. Her new album, ARTPOP, just earned the nickname ARTFLOP. Take note.

To a large degree, both of these pop stars owe their fame to the same social mood forces that have caused the market to rally since 2009. The same social mood that twice put the President in the White House even though a majority of the country do not like his policies. Yet even his star seems to be fading, too. With a record low approval rating, he too is sending a social mood alert that is loud and clear.

Bieber, who refers to his 48 million Twitter followers as "beliebers," has an album entitled Believe, a Believe tour, and a 3D film named Believe.

What does he want people to believe? That he's for real? That he's not a flash in the pan?

The word believe is also a great description of Fame, which is really just a highly intense, shared mental state. By using it as a grammatical imperative, it is a command, as if to say Believe in this shared belief.

If Bieber's retirement really happens, the shared mental state that has produced record levels of bullishness (and prices) in the markets, may suddenly be revealed to be nothing other than an over-loved, over-believed market based on a multi-year suspension of belief.

Who cares that low rates make it easy for companies to buy back their stock in order to goose EPS. Who cares that the bond market may be sniffing out deeper troubles. With the proper suspension of belief, trouble can be changed to "rising rates for the right reasons."

The point is that, like the sudden flop of pop icon Lady Gaga, the market is subject to the same vagaries of social mood that can shift at any time -- just look at a chart of Bitcoin. There's no Fed to support it or to manipulate the supply. There is only aggregate demand, and that demand is subject to one thing: the social mood of buyers and sellers.

In a volatile mood: two 50% moves in two weeks

Tuesday the S&P closed at the top end of the 1827-1833 range cited in previous posts. Volume will likely be light. Without a correction, 1844 is the next Fib extension target (a 1:1). This week and next week will hopefully be uneventful, but 1800 remains a level that should not be taken out unless this market has plans for retirement.

Meanwhile, keep your eye on Bieber, Gaga, and the President.


  1. Interesting perspective on market psychology. Definitely made me do some thinking. That Beiber kid is what though? 20? I think he's just trying to say he wants a little break or worse...more attention. Gaga's last album sucked. I don't think she had as many "believers" blindly buying another crappy album.