Sentiment Indicators, Sort Of

One thing that market mavens will tell you is that any measures of investment sentiment need to be read with considerable care. For instance, high short interest is considered bullish. Why? If stocks move upwards (and remember, just due to daily noise, stocks move around quite a bit), shorts will have to buy stocks if they want to cover their short position. so high short interest can be read as pending purchases. Similarly, pervasive bullish or bearish sentiment is usually read as a sign of at least a short-term reversal (think of it: if everyone is bullish already, who is left to buy?)

So with those considerable caveats, we offer some charts, courtesy the Big Picture, for your consideration:

Google searches: “stock market crash”

Google searches: “recession”:

Those first two were from Big Picture. I had fun and went looking for my own. Note that neither “bank crisis” or “banking crisis” had enough volume for Google Trends to generate a chart, but these terms did:

Google searches: “credit default swaps”:

Google searches: “cdo”:

Google searches: “great depression”:

Google searches: “credit crisis”:

Google searches: “deflation”:

Google searches: “inflation”:

Charts like these help explain the saying, “If you must forecast, forecast often.”