The Fear & Greed Index
Whether we’re talking about economic confidence or investor optimism, emotions drive the marketplace. On Wall Street, however, the feelings that drive decisions are even more primal. CNN has devised a new index to gauge the Street’s lizard brain: the Fear and Greed Index. It factors in seven market indicators — ranging from junk bond demand and market volatility to stock price momentum — to determine how far they deviate from the normal.
Right now, the index concludes that “extreme fear” is driving the market, whereas it was just straight-up “fear” a month ago.
(CNN Money)
Why does the index matter? “Too much fear can sink stocks well below where they should be. When investors get greedy, they can bid up stock prices way too far,” CNN explains.
- Spam
- Obscene
- Duplicate
Blog Contributors
Ezra Klein
Ezra Klein is the editor of Wonkblog and a columnist at the Washington Post, as well as a contributor to MSNBC and Bloomberg. His work focuses on domestic and economic policymaking, as well as the political system that’s constantly screwing it up. He really likes graphs, and is on Twitter, Google+ and Facebook. E-mail him here.
Neil Irwin
Neil Irwin is a Washington Post columnist and the economics editor of Wonkblog. Each weekday morning his Econ Agenda column reports and explains the latest trends in economics, finance, and the policies that shape both. He is the author of “The Alchemists: Three Central Bankers and a World on Fire.” Follow him on Twitter here. Email him here.
Sarah Kliff
Sarah Kliff covers health policy, focusing on Medicare, Medicaid and the health reform law. She tries to fit in some reproductive health and education policy coverage, too, alongside an occasional hockey reference. Her work has appeared in Newsweek, Politico, and the BBC. She is on Twitter and Facebook.
Brad Plumer
Brad Plumer is a reporter focusing on energy and environmental issues. He was previously an associate editor at The New Republic. Follow him on Twitter. Email him here.
Dylan Matthews
Dylan Matthews covers taxes, poverty, campaign finance, higher education, and all things data. He has also written for The New Republic, Salon, Slate, and The American Prospect. Follow him on Twitter here. Email him here.
Loading...
Comments