FINANCIAL PARADIGMS

"The experience of being proven completely wrong is salutary. No economist should be denied it and none are".    John Kenneth Galbraith.

David McMinn

I have been advocating a strong Moon Sun effect in financial activity for many years. My first paper on this topic was presented at an economics conference in 1986. Alas it has been a slow slog getting this view even debated within traditional economics. During the 1990’s, my early papers were readily published in astrological and technical analytical journals in the UK, USA, Australia, Italy and Hong Kong (refs). However, academic and business economists completely ignored my work, as to be expected given the radical nature of the topic.

According to Dean Radin in his book The Conscious Universe, “the acceptance of new ideas follows a predictable, four-stage sequence. In Stage 1, skeptics confidently proclaim that the idea is impossible because it violates the Laws of Science. This stage can last from years to centuries, depending on how much the idea challenges conventional wisdom. In Stage 2, skeptics reluctantly concede that the idea is possible, but it is not very interesting and the claimed effects are extremely weak. Stage 3 begins when the mainstream realizes that the idea is not only important, but its effects are much stronger and more pervasive than previously imagined. Stage 4 is achieved when the same critics who used to disavow any interest in the idea begin to proclaim that they thought of it first. Eventually, no one remembers that the idea was once considered a dangerous heresy.”

Moon Sun finance has gone through the Stage 1 and has reached Stage 2. In Stage 1 from 1970 to 2000, the early Moon Sun studies in financial astrology and technical analysis were simply ignored by mainstream economists. The Moon’s gravitational effect was considered to be too tiny to have an impact upon that intelligent, perfectly rational species - Homo economicus. Stage 2 came with recognition by orthodoxy that a Moon Sun effect was possible. The beginning of this stage was marked with the release of two working papers from the University of Michigan in 2001. The researchers correlated lunar phase with stock market activity and were the first such papers to be published by academics from a prominent university. The papers were peer reviewed, statistically sound and the effect was observed in most world stock markets. Another paper on a lunar phase effect in stock market activity was published in the prestigious Harvard Business Review in 2006. This has spawned numerous additional academic papers in recent years (refs). It is not a question  whether the Moon and Sun have an impact upon financial activity but to what extent. I have long claimed that these luminaries are the dominant influence in market timing. This view may be confirmed by numerous excellent correlates that support a very strong Moon Sun effect.

Stage 3 will emerge, when the Moon Sun influence is recognised by mainstream as being “not only important, but its effects are much stronger and more pervasive than previously imagined.” Alas, this may take some time given the intellectual rigidities within the economics profession. Stage 4 is years away when former opponents of the concept “begin to proclaim that they thought of it first.” Ultimately, no academic will admit to ever having supported the old efficient market paradigm and people will forget that the Moon Sun theory was “once considered a dangerous heresy.”

In the latter decades of the 20^th century, orthodoxy remained glued to the belief that free markets were both random and efficient, even though this view was completely wrong. Many economists were only shaken in their adoration of free markets after the disaster of Black October in 2008. Moon Sun finance proves that financial activity is mathematically structured and that free markets are inefficient and at times ridiculously inefficient. Whole sections of economic theory will need to be revised in the light of such findings. It remains to be seen how long it will take mainstream economists to accept that the Moon and Sun play a dominant role in financial trends. 

Conservatives are always slow learners - by definition they cannot cope with new ideas not even good new ideas.