Moods and Markets

Foreword xix Introduction 1 Chapter 1 Understanding Social Mood 11 Mood Defined 12 Mood Versus Emotion 14 Confidence and Our Perceptions of Certainty 15 The Continuum of Social Mood 20 Individual Versus Social Mood 24 Measuring Mood 25 Social Mood and the Media 28 Mood Groups 31 Final Thoughts 32 Chapter 2 Horizon Preference: How Mood Affects Our Decision Making 33 The Horizon Preference Continuum 35 Logical Decision Making in Periods of Rising Social Mood 39 Logical Decision Making in Periods of Falling Social Mood 45 Opportunities During Declining Social Mood 50 Final Thoughts 52 Chapter 3 Market Peaks and All the Red Flags They Wave 55 The Concept Stock Bubble 56 Big Truths 58 Abdication of Risk Management 59 Organizational Complexity 61 Novice and Naive Entrants 62 Credit, Architecture, and Other Signs of the Top 63 Why Investment Peaks Are Different 68 After the Peak 70 Final Thoughts 71 Chapter 4 A Social Mood Journey Back Through the Housing Bubble 73 Modern Housing Finance 75 A Big Truth 78 Abdication of Risk Management 78 Organizational Complexity 80 Novice and Naive Entrants 82 Excessive Credit and Architecture 83 Final Thoughts 84 Chapter 5 Is Higher Education a Bubble? 85 A Big Truth 85 Abdication of Risk Management 88 Organizational Complexity 91 Naive and Novice Participants 91 Excessive Credit 92 Architecture 93 Final Thoughts 95 Chapter 6 Signs of a Bottom in Social Mood 99 Extreme "Me, Here, Now" Behaviors 100 Hoarding Behaviors 101 Acts of Sacrifice 104 Event Versus Cycle Lows 108 The Market Low of 2002 109 The Market Low of March 2009 110 The Market Bottom of 1932 112 Seeing Major Market Bottoms in Real Time 113 Social Mood and Invention 115 Final Thoughts 120 Chapter 7 Cooking the Books: Corporate Earnings and Social Mood 121 Mood-Driven Accounting Principles 122 Mood-Driven Management Judgment 125 Mood-Driven "One Time" Charges 130 Final Thoughts 133 Chapter 8 Social Mood and the Markets Today: So Where Are We? 135 Modern Day Extremes in Social

Peter Atwater is President of Financial Insyghts, a consulting firm providing advice to institutional investors, major corporations, and global policymakers on how social mood affects decision making, the economy, and the markets. A pioneer in securitization and a long-time financial services executive, through Moods and Markets, Peter brings his innovative social mood-based thinking to the world of investing. A regular contributor to Minyanville, Peter's work on social mood and decision making has been featured in The Socionomist, Time Magazine, and The Financial Times.