In these perilous economic times, in which 9.6% of the labor force finds themselves out of work, hysteria in media outlets can often run rampant over the smallest, most meaningless things. This was the case with the October 30, 1938 radio broadcast of The War of the World’s, an adaptation of H.G. Well’s book with the same name. The first two thirds of the 60-minute broadcast were presented as a series of simulated “news bulletins “, which suggested to many listeners that an actual alien invasion by Martians was currently in progress. The broadcast had an effect on the public, causing panic to break out in many homes nation-wide. The fact that the radio series: Mercury Theatre on the Air, of which this broadcasting was the third installment, did not run commercial breaks heightened the effect of realism.

It is important to keep these type of situations in mind when analyzing  the flood of information that reaches us every day. Many times a society dwells on a particular issue until it is blown out of proportions, as was the case with the radio broadcasting of The War of the World’s in 1938.

Instances like these are worth our attention because they remind us to be very careful and open minded with our analysis of today’s news events.

Likewise, we should be equally careful when we consider The Hindenburg Omen, a technical analysis pattern that has been the subject of recent news reports. The Hindenburg Omen is a combination of many technical factors that attempt to measure the health of the stock market, and more specially, the NYSE. The Hindenburg Omen is meant to signal the increased probability of a stock market crash.

The reason why so many have been talking about this indicator is because of two recent confirmed instances of the Hindenburg Omen, both of which happened in the last couple of weeks (August 12th and August 2oth). Another almost appeared on the 23rd, but fell short of the prerequsites. These prerequisites are as follows:

1. The daily number of NYSE new 52 week highs and the daily number of new 52 week lows are both greater than or equal to 2.8 percent (typically, 84) of the sum ofNYSE issues that advance or decline that day (typically, around 3000)^[3]. An older version of the indicator used a threshold of 2.5 percent of total issues traded (approximately 80 of 3200 in today’s market).
2. The NYSE index is greater in value than it was 50 trading days ago. Originally, this was expressed as a rising 10 week moving average, but the new rule is more relevant to the daily data used to look at new highs and lows.
3. The McClellan Oscillator is negative on the same day.
4. New 52 week highs cannot be more than twice the new 52 week lows (though new 52 week lows may be more than double new highs).

Read this from The Wall Street Journal:

The Hindenburg Omen reared its ugly head late last week, signaling more doom and gloom as stocks plod along amid the dog days of summer.

The Omen, a technical indicator which uses a plethora of data to foreshadow a stock-market crash, was tripped again on Friday, marking the second time since Aug. 12 it has occurred. (It also came close on Thursday, but one of its criteria fell short.)

The latest trigger has prompted the Omen’s creator, Jim Miekka, to exit the market. “I’m taking it seriously and I’m fully out of the market now,” Miekka, a blind mathematician, said in a telephone interview from his home in Surry, Maine. “I would’ve probably stayed in until the beginning of September,” depending on how the indicators varied. “That was my basic plan, until the Hindenburg came along.”

The Omen has been behind every market crash since 1987, but significant stock-market declines have followed only 25% of the time. So there’s a high likelihood that the Omen could be nothing more than a false signal.

But that isn’t stopping Miekka from taking any chances, especially as September, typically the market’s worst-performing month, sits only one week away.

“It’s sort of like a funnel cloud,” he said. “It doesn’t mean it’s going to crash, but it’s a high probability. You don’t get a tornado without a funnel cloud.” He added he’s not currently shorting anything, although he may look to short Nasdaq stock index futures in the next few weeks, “depending on how the technicals go.”

Here are the statistics from Wikipedia:

From historical data, the probability of a move greater than 5% to the downside after a confirmed Hindenburg Omen was 77%, and usually takes place within the next forty days. The probability of a panic sellout was 41% and the probability of a major stock market crash was 24%. Though the Omen does not have a 100% success rate, every NYSE crash since 1985 has been preceded by a Hindenburg Omen. Of the previous 25 confirmed signals only two (8%) have failed to predict at least mild (2.0% to 4.9%) declines.

Earlier I said that it is important to analyze the situation before jumping on the band wagon on issues that are causing hysteria in the media and society. However, I believe there is a difference between fallacious hysteria and well founded anxiety based on statistics that are certainly anything but promising.

I hope that you take at least two things away from this article today: First, I have made it my aim to help you to remain on your guard for false information, as much of this is circulated in the media on a daily basis, as well as to develop a fact-based, well measured perspective on politics, so that you may have a better understanding of the truth.

Secondly, I hope that our analysis of the Hindenburg Omen has given you reason to be cautious (as well as diversified), if nothing else, in your investment practices because we are living in perilous times. In this case, the likelihood of The Hindenburg Omen forecasting a major stock market crash does not seem imminent, as it has only produced those results 25% of the time since it’s creation. However, every NYSE crash since 1985 has been predicted by the Hindenburg Omen. Furthermore, Jim Meikka, who invented the Hindenburg Omen, has pulled out of the market following the second occurrence on the 20th. Paul in 1 Corinthians 16:13 warns us to “Remain alert. Keep standing firm in your faith. Keep on being courageous and strong.”.

I as well urge you to remain alert.

Below is an article written by my friend Daniel Walton on the subject of Evolutionary theory and Intelligent Design. In light of the one sided origins science presented in high school biology at present, Daniel is pointing out just a few of the thousands of holes in Darwinian Evolution that keep it from elevating from a scientific theory to the status of a scientific fact. Daniel has also agreed to write more articles for TFL in the future.

In our public school systems, high school student are continuously bombarded with the theory of Evolution. The biggest problem with that is it is not presented as a theory but as fact. Now if it is really a fact then there is no problem with it, but the reason it is called a theory is because there is not sufficient evidence in order for it to be considered a scientific fact. In reality, there is a lot of evidence suggesting it’s falsity. William Demski is one of the scientists leading the charge for Intelligent Design and Creationism in the intellectual realm. I would like to look at some of his works and how they disprove the idea that evolutionary theory is not a theory but a scientific fact.

First, a few definitions might be helpful. Evolution is the theory that all things came about through natural selection, survival of the fittest, and mutations. It states that all matter came about by chance and/or necessity.

Intelligent Design suggests that a designer made the universe. it does not suggest who created it or how. Creationism is a scientific theory based on the Bible. It states that God created the heavens and the earth and that the Fall of Man, as well as the Great Fall, were both factors that have caused it to be in the decaying state that it is in now. Creationism goes one step further than the theory of Intelligent Design in that it attempts to explain both the whom and how of creation.

Demski states that there are only three ways for something to happen: necessity, chance, and design. If there is any design (not put into effect by humans or animals ect.) then there must be a designer and therefore Intelligent Design is correct and Evolution is wrong. So he set out on a way to prove that things on the earth had been designed by an intelligent designer. He uses something called the Explanatory Filter.

The filter works like this: We run something through it like a dog, and then we ask if it can be made by necessity. If there is any other way for it to have been made then it was not made by necessity. If it has specification and complexity, then it is not made by chance. If it is not made by the other two it must be made by design.

But before we use this there is something else we need to keep in mind: Even if the filter says something is made by necessity or chance than it might be made by design. i.e. A person can tip over a water glass just as easily as it happening by chance (in fact it might be more likely).

If if I run my dog, P.J, through the filter,  I first ask: “Did he have to be made exactly as he was in order to function the way in which he does”. the answer to this question is no. Second I  must ask myself: “Does he have specification and complexity”. Evolutionist think that dogs are highly complex (evolved) animals, so they can testify to it’s complexity. Also, I can tell him apart from other dogs, so he has specification from other species as well. So this means he was designed, if he was designed (and he obviously wasn’t designed by humans) there must be a Designer. This means that Intelligent Design is correct.

Scientists have no way of knowing that evolution is true but instead they try to brainwash our generation into believing so without so much as exploring opposing theories.