Index cohesive force

Closer inspection revealed that the anomalously strong index effect is due to the excessive dominance of the financial sector.

that the dangerous excessive dominance of the financial sector might have been a direct consequence of the US hasty and drastic interest rate cuts and other remedies used in 2001 to overcome the fallout effect of the "dot com" bubble collapse.

Hence, eventually, those remedies led to the recent market collapse upon the burst of the subprime bubble and the fall of the Lehman Brothers Bank.

"Accepting this picture", says Ben-Jacob, who also conducts research in human epilepsy, "we realize that while the current US policy makers talk about change, in practice they rely on cosmetic changes and avoid the major and painful surgery needed to cure the market.

"[citation needed] Thus, the ICF is a new quantitative measure to assess the stability and well-being of financial markets.

The transition from normal (healthy) market behavior into abnormal seizure-like behavior at the end of 2001 (the vertical dashed line). Top is the S&P Index from March 7, 2000 until March 22, 2011. The third panel shows the stock correlations and the second panel shows the partial correlations (the correlations after subtraction of the index effect). The decrease in the partial correlations manifests the abnormal dominance of the Index. This effect is further pronounced when looking at the Index Cohesive Force – the ratio between the stock correlations and the partial correlations, shown at the bottom panel.
The network topology before the transition (left) and after the transition (right)