Fashion has long been a visible expression of culture. From ancient feathers and shells to the flare and fit of modern designs, fashion is a trend that can catch fire on and off the runway as it reflects society’s prevailing sentiment.

From a socionomic perspective, what people wear collectively on the outside is a powerful indication of how they feel on the inside. We firmly agree with Vreeland’s point, that “fashion is part of the daily air,” or in our case, the underlying social mood. In clothing, you can even anticipate an approaching “revolution,” as in, a major shift in social mood.

In the August 1985 Elliott Wave Theorist, Robert Prechter referenced a well-documented study from 1926 in which University of Pennsylvania’s George Taylor demonstrated that women’s hemlines rise and fall with the stock market:

“It has long been observed that the trends in hemlines and stock prices appear to be in lock step. It is not unreasonable to hypothesize that a rise in both hemlines and stock prices reflect a general increase in friskiness and daring among the population, and a decline in both, a decrease.”

When Barron’s printed an excerpt of this issue of the Theorist, it received this reader’s comment: “Reading Prechter’s article, you’d think he was saying it’s better to read Women’s Wear Daily than the Wall Street Journal,” to which Prechter replied, “That’s exactly what I’m saying.”

Fast-forward to 2024, and the sky is literally the limit to the in-vogue inseam, as fashionistas have adopted the “no-pants” look. There are no hemlines to speak of at all as the hottest fashion trend sweeping the globe is inspired not by Italian designer Donatella Versace, but rather Disney’s cartoon Donald Duck.

These headlines show that the pace of high fashion going bottomless continues to accelerate:

• In Case You’re Wondering, Here’s How You Can Actually Pull Off the Infamous No Pants Trend IRL (Fashion Times, Nov. 7, 2023)
• This Is Not a Drill: The Pantless Trend Is Really Happening… (Vogue, Nov. 8, 2023)
• 2023 Was the Year We Abandoned Pants (British Vogue, Nov. 24, 2023)
• Why Women Are Walking Around Without Pants This Winter. From runways to grocery runs, bottomless looks are everywhere. (Wall Street Journal, Jan. 24, 2024)
• How the No-Pants Trend Became the Pinnacle of Chic (W Magazine, Feb. 20, 2024)

The socionomic lens can include enough history to make sense of what’s happening. The rise of hemlines all the way to their eventual disappearance coincides with a waxing positive social mood. As Prechter explained in his August 1985 Elliott Wave Theorist,

“Because skirt lengths have limits (the floor and the upper thigh respectively), the reaching of a limit may imply that a maximum of positive or negative mood has also been achieved.”

The first notable instance of this phenomenon came after World War I, as the Roaring Twenties brought changes galore. Women were granted the right to vote. In turn, fashion designers ditched bodices and long petticoats to make room for loose-fitting flapper dresses with hemlines rising to heights that were then considered scandalous.

This was a decade all about freedom and social progression, and naturally, daring hem lengths followed suit. It’s easy to overlook the hemlines of flapper dresses, but their above-the-knee length was considered shocking at the time, especially when coupled with the loosed waistband instead of a rigid corset.

The frisky flapper fad came to a screeching halt with the 1929 stock market crash and the Great Depression.

“Hemlines [came] crashing back down to the floor with its grim psychological effect on the public. The lack of money and merriment meant the debauchery and risk taking of the ’20s disappeared and was replaced by a return to a level of modesty — both economically and fashionably.” (Women’s History)

Fast forward to the 1960s, a time of swinging sexuality, women’s liberation, civil rights and a still-lingering boom from the 1950s decade of prosperity. Across the pond, fashion legend Mary Quant debuted a new, vibrant-colored garment that stood six inches above the knee and was named after her favorite British car, the Mini. The mini-skirt ruled the runways from Milan to Paris, then to the red carpet and city streets.

Taking it even further, in the late 1960s, fashion designers raised hemlines even higher, which became a reality on the runway in 1970, even though stocks had already peaked. In December 1970, Women’s Wear Daily coined a new term for the fiery fashion fad: “hot pants,” aka “booty shorts,” which had a maximum inseam of two inches.

Yet, the hot pants trend was short lived as social mood finally began to wane alongside stocks. On December 31, 1971, Life Magazine documented the brief but memorable impression made by the sartorial drawers:

“Hot Pants: A Short but Happy Career: Hot pants were the hottest in the winter, flourishing during the iciest, most shivery months. And by summer they ceased to be the height of chic.”

The king of R&B, James Brown hit a high note in 1971 with the song “Hot Pants,” his tribute to the tiny and trendy garment. Brown’s beat may have been smoking, but the fashion trend fizzled during years of economic recession, runaway inflation, and political scandal until the bear market low in 1982.

Throughout history, the height of fashion-forward hemlines has been a powerful clue into the waxing or waning nature of positive social mood. In the October 2016 Elliott Wave Theorist, we presented this chart of the Dow along with photographs from the Fashion Institute of Technology, characterizing skirt fashions of the past 150 years. From the Elliott Wave Theorist:

Once again, a socionomic observation has led to multiple successful predictions. Early in the bull market, my 1985 report quoted a fashion model saying about skirts of the day, “they’re real cute as long as they’re not too short.” As social mood headed toward a positive extreme in the late 1990s, mini-skirts became widely popular for the first time since the late 1960s. Following a lull during the stock market setback of the early 2000s, mini-skirts dominated fashion again near the stock market peak of 2007, when a headline advised, “The Mini-Skirt is Back, So Get Those Legs in Shape.”

Conversely, the Theorist noted this about the downside,

“When stock markets around the world plunged from that year until 2009, fashions returned to the ‘maxi-skirt’ look popular at the bear-market low of 1974.”

Also in 2009, Barney’s luxury department store displayed mannequins with ankle-length black dresses, apparently in their death throes after being shot. Completed with blood spatters on the interior window, a scene exemplifying a polar opposite extreme of waning mood.

Which brings us to today’s new watermark in fashion: The pantsless trend. If rising hemlines reflect waxing positive social mood, what does it mean when there’s no hemline to measure? Depending on how the next revolution of mood unfolds, investors may be the next ones to lose their pants.

As for any doubt that “less is more” is indeed the new dominant fashion trend, cue the 2024 Oscars and the event’s most prestigious afterparty thrown by Vanity Fair Magazine. On Sunday, March 10, the red carpet was red hot, thanks to what one magazine called a “barely any clothes cavalcade.”

As the occasion winded down. A-Listers trickled over to the Vanity Fair afterparty to celebrate in style. The hottest trend of the night? Nearly-naked dressing in gowns that barely counted as clothes. Not to mention Oscar presenter John Cena was literally pantsless on stage in his birthday suit and a pair of brown sandals to present the best costume design award.

From a socionomic perspective, top designers and celebrities who flaunt their stylish clothes have reached a new extreme in friskiness. Ultimately, the decision to “bare it all” may have much broader consequences.

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