COSMO-ECONOMIC SUNSPOT FINANCIAL RESEARCH (CSFR) MODEL

Historically, the study of the world’s economy was classified into Micro-economic and Macro-economic. Perhaps, contemporary economists should learn from the ‘astronomists’ about the universe which we are part of it. This article shall name it as ‘Cosmo-Economic’. Many scientists have found that sunspots affect human behaviour. With all these evidence in mind, the aim of this exploratory research paper is to investigate how sunspot activities can affect the investors’ sentiment in the financial world since 1970 when the first post-war financial crisis was built up. This paper explain the recent stock-market surge in Hong Kong, with the Hang Seng Index (HSI) surged 30% within one week trading. Time series techniques were deployed to track down the changes of Sunspot Counts over the last 38 years on the world’s 3 main financial indices, i.e., S&P, FTSE and Nikkei. It was pretty astonishing to find out that, the impact of the Sunspot Counts on them are highly significant, even on a day-to-day time series analysis. Furthermore, HSI during the same period is used as a validation instrument. This established phenomenon can also help to predict what could happen just before the next global financial tsunami in 2030.