Our work on the causes of food prices has been selected to be among the top 10 scientific discoveries of 2011. We showed that elevated prices are due to investor speculation and grain-to-ethanol conversion.
We linked unrest to recent peaks in global food prices, underlined by the ongoing trend of increasing prices. Extrapolating these trends, we identified a crossing point to the domain of high impacts, without price peaks, in 2012-2013.
We characterized the cascading crises in the Middle East, providing a broader historical and scientific framework. We identified key interventions to prevent the further spread of violence and anarchy, and the mechanisms of the cascades.
We published research on how to achieve peace among ethnic groups. The research shows that peace can be sustained by topographical and political boundaries separating groups. Our analysis of both peace and conflict shows that Switzerland may serve as a model to resolve conflict in other ethnically diverse countries and regions of the world.
NECSI research showed that measures of mimicry in the market can predict market crashes. This is a new and directly accessible measure of systemic risk.
We also showed that market manipulation may play an important role in market behavior. Citigroup's stock price plummet in November 2007 coincided with evidence of coordinated selling of borrowed stock, consistent with an intentional effort to trigger market panic. The subsequent price drop enabled the attackers to buy the stock back at a much lower price.
See also why flash crashes happen
As anger over the continuing recession heated up and the Occupy Wall Street movement gained momentum, President Yaneer Bar-Yam posted a statement of support for the group, highlighting the science behind the 99 percent's woes. Regulation and deregulation by government bodies have created conditions that undermine the very stability of the economic system promoting conditions that result in widespread suffering. Action is needed to restore the underlying viability of the economic system.
Please consider supporting our work so we might continue this work in 2012 and beyond. A tax-deductible contribution will help us provide real-time scientific responses to global problems.
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Professor and NECSI President