by Bob Stokes
Updated: March 31, 2017
The DJIA is much more than a financial gauge: The index is also predictive in the multi-faceted arena of social trends, including movie attendance, fashion, politics and more. See what our Elliott Wave Theorist shared with subscribers.
[Editor's Note: The text version of the story is below.]
On Jan. 25, the DJIA marked a milestone, closing above 20,000 for the first time.
Then, before you could blink an eye, the index turned around and closed above 21,000 for the first time on March 1 (Marketwatch):
Dow 21,000 matches the fastest 1,000-point march in history
Days later, on March 9, the bull market in U.S. stocks marked its eighth anniversary.
Suffice it to say, for those investors who are long stocks, the market's climb has been a thing of beauty. And the boxoffice agrees (Forbes, March 28):
Walt Disney's Beauty and the Beast continued to waltz its way into the record books, earning $6.9 million on its second Monday and bringing its domestic cume up to an insane $325.9m in just 11 days. ... It's doing just as well overseas. ... Beauty and the Beast has passed the $700m mark worldwide.
At first, you may not see a connection. What does the stock market have to do with a popular movie? Ah, but it's not just any movie -- it's a Disney film.
We've long noted that "rising stock prices coincide positively with the quality and popularity of Disney animated fairy-tale films, and falling stock values coincide positively with the originality and popularity of horror movies." Here's what our Elliott Wave Theorist shared with subscribers in October 2016:
Disney studios was asleep at the wheel for six years after the 1982 bottom in the Dow/PPI, but the company finally caught on to the positive trend in social mood and issued The Little Mermaid in 1989, kicking off a new string of family-oriented, animated tales. After the stock market's real value peaked in 1999 and a ten-year bear market began, horror movies became a theater staple and filmmakers found a new way to shock people, with "torture porn" films, led by Saw (2004) and Hostel (2005). Disney's animated films continued in production as slipping stock values nevertheless held near all-time highs, but 2009's The Princess and the Frog, issued near a major stock market bottom, was so poorly attended that the studio announced on November 20, 2010 that, though it had completed work on Tangled, it had canceled its other fairy-tale projects "for the foreseeable future." As stock prices resumed rising, however, the company quickly resumed producing fairy-tale films. In 2014, with the stock market at all-time highs, Disney's Frozen became the highest-grossing animated film ever.
We've also observed a compatibility between stock prices and other social actions and trends, ranging from the height of fashionable women's hemlines and the fate of political incumbents to the number of patents granted and annual nuclear weapons tests worldwide. There are many more such correlations.
Our publications will continue to keep subscribers ahead of major financial and social trends.