"WHO declares first 21st century flu pandemic," reads a June 11 headline. To us here at Elliott Wave International, what continues to be most interesting is the timing of the swine flu outbreak. As we've reported before, disease epidemics are hardly random. Historically, they occur at specific moments in human history: when social mood is at a low.
As measured by the stock market, we recently completed a large wave in a powerfully-negative social-mood trend. It bottomed amid extremely pessimistic sentiment. Social stress reached higher levels than it has in decades. Soon after, H1N1 swine flu erupted and came right to the edge of being a pandemic. If this was the only such instance of disease breaking out after a social-mood decline, it might be coincidence, but there are numerous examples in the historical record.
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