"Radical Islam Is a Fact of Life. How to Live With It," proclaimed Newsweek magazine one year ago on the cover of its March 2, 2009, issue. Its recent Feb. 22, 2010, cover sang a different song, though: "How bin Laden Lost the Clash of Civilizations: The Untold Story of the Triumph of Muslim Moderation."
What happened in the space of one year? Newsweek is not the only media outlet to notice a shift in social mood in the Muslim world: CNN recently reported that Muhammad Tahir al-Qadri, a respected Muslim scholar based in Pakistan, issued a religious ruling that condemns suicide bombers.
What makes this moderate Muslim attitude more interesting is that EWI's Asian analyst predicted it, based on the Newsweek cover of March 2009. Here's an excerpt from the April 2009 Asian-Pacific Financial Forecast that explains his forecast that radical Islam's influence would begin to wane.
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In early March, Newsweek’s cover proclaimed, “Radical Islam Is a Fact of Life. How to Live With It,” a headline that probably marks not only a major low in two key Islamic stock markets but also an exhaustion of the trend toward Islamic extremism of the past year.
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Paul Montgomery of Universal Economics has long demonstrated the tendency of social trends to make the cover of popular newsmagazines just as those trends are nearing their peaks. Most of his research focuses on financial trends, but the same principle applies to other areas of social activity: Editorial staffs are most likely to acknowledge a trend on their cover when their readership is already convinced of it. And, because of the dynamic nature of social trends, that’s usually just about the time that the trend is near its end.
By definition, dismal financial images are a sure lure near stock market lows. But so are covers about a national leader when his or her approval rating is near an all-time high. Newsweek’s capitulation to the reality of Islamic extremism fits into that “other social” category. Interestingly, it was dated March 2, 2009, one day before the low in the Amman General Index.
Middle Eastern and Central Asian extremists probably do have one or two big tricks up their sleeves yet, since the mood in the early stages of a bull market tends to stay negative for some time. The same may hold true for Southeast Asian extremists, if we use the Jakarta Composite as a measure. But from a pure wave pattern perspective, these provocateurs will now have to wage their battle uphill since societies tend to lose their tolerance for antisocial behavior during bull markets.
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The recent March 2010 issue of the Asian-Pacific Financial Forecast follows up on this trend and predicts where it might be headed next, based on trends in Middle East markets. To find out what's next for Islamic markets -- and to get expert analysis on all major Asian markets -- subscribe to the Asian-Pacific Financial Forecast risk-free.