BOOM! The Supersonic Indicator
by Editorial Staff
Updated: August 12, 2022
This excerpt is from the August 2022 Global Market Perspective.
BOOM! The Supersonic indicator.
By Murray Gunn, Head of Global Research
Supersonic flight is making a comeback. The timing couldn't be better.
I lived in west London for a few years during the 1990s. On the Heathrow flight path, aircraft noise was just something you got used to. But then there was Concorde. When that bird took off (whoo-hoo!), the whole building would shake. You literally couldn't conduct a phone call even with the windows shut. What a privilege to see and hear it in flight.
I thought about this recently when reading that United Airlines has ordered 15 of the new aircraft being developed by Boom Supersonic. Going by the name of Overture, the airplane will carry commercial passengers at Mach 1.7 (1,100 miles per hour) halving the flight time from London to New York to around 3.5 hours. The design is stunning, and very similar to the previous icon of supersonic flight, Concorde, grounded 22 years ago. So, why is commercial supersonic flight making a comeback now?
EWI and the Socionomics Institute have written about the relationship between transportation speed and the stock market for decades. As social mood waxes positive, people increasingly desire and pursue faster forms of transport or thrill seeking. The opposite is true as social mood trends negative.
The origins of the Concorde project date back to the 1950s, when social mood was trending positively as seen in the chart below of the quintessential global sociometer, the Dow Jones Industrial Average. In 1963, after a 650% rise in the stock market from 1942, the first commercial orders for Concorde started to appear and construction of prototypes began in 1965. This coincided with a significant peak in social mood, and the Dow Jones Industrial Average traded sideways-to-down from the mid-1960s to the early 1980s. In real terms (price inflation adjusted), that represented a vicious bear market.
Fast forward to 2022 and after a 400% advance in the stock market from 2009 propelled by a positive social mood, the first commercial orders for Overture are appearing. Production is due to start, and the first aircraft is to be unveiled in 2025. Boom Supersonic hopes to be commercially flying Overture by 2029.
The timing of the return of Supersonic flight is appropriate, given that we anticipate 2021 and 2022 represents a zenith in social mood, more significant than the mid-1960s top, and one which might herald in decades of regress. That sound you're hearing now? It might be the sonic boom of financial markets imploding.
Editor, European Financial Forecast
Head of Global Research
Murray Gunn worked as a fund manager in global bonds, currencies and stocks, including long posts at Standard Life Investments and the Abu Dhabi Investment Authority. He then joined HSBC Bank as Head of Technical Analysis. Murray is the author of Trading Regime Analysis and a contributor to Socionomic Studies of Society and Culture. Murray is the editor of The European Short Term Update. You can also read his commentary in Global Market Perspective, Interest Rates Pro Services and Currency Pro Services, and on deflation.com.
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