I think the following chart, from Google Trends is very interesting. As seen below I keyed in the word “recession” in Google Trends to try and tap into investor sentiment through the means most people use now, the internet. Interestingly enough as we see below during the depths of the credit crisis and market plunge of ’08 that bottomed in ’09 the word recession was actively and consistently search for. Subsequently as the market improved and things got better the amount of searching for the word “recession” tapered off dramatically.
Remember investors, generally speaking, are reactive and not proactive, thus searches tend to peak during extreme periods of panic/interest. That said we think given the amount of sell-off the market has recently endured there are a relatively low amount of searches for the word recession. This suggests to us investor complacency/apathy which isn’t something we correlate (from a sentiment perspective) with a solid market trough.
Please note: The letters on the chart below represent highly read news stories and aren’t paramount to the point we are trying to make.