Topley’s Top 10 – May 26, 2022

1. 40% of Trading Days this Year 1%+ Moves…2008 Levels

Nasdaq Dorsey Wright-A major portion of the trading days so far this year have seen SPX move at least 1% higher from its daily low into the close, with the count at 39 days through market action Monday. This equates to 39.80% of the days. which is significantly more than the average dating back to April 1987 at about 20.64% of the days. This also puts us on the highest pace of trading days with such a move since 2009. The only other year to see such a high pace of 1% intraday rallies came in 2008. We saw a significant count of intraday rallies from 1997 through 2002, although none of those years reached the current pace. The year with the lowest percentage of large rally days was 2017, which saw only one such day throughout the entire year.

2. Another 2008 Number….Max Pessimism–Percent that Expect “stronger economy” Lower than 2008

From Irrelevant Investor Blog

3. History of 7 Week Sell Offs.

Don’t Panic! What History Tells Us After 7 S&P 500 Losing Weeks-The S&P 500 has fallen for seven weeks. Here’s why you don’t want to panic now. BRET KENWELL

Seven straight weekly declines is a pretty rare occurrence. This is just the fourth time we’ve seen such a streak since 1928. The prior three scenarios occurred in 1970, 1980 and 2001. Interestingly, all four declines concluded either in March or May.

To little surprise, there is good news and bad news associated with the declines.

The bad news: In two of the three declines, the seven straight weeks of declines turned into eight straight weeks of declines (in 1970 and 2001).

Further, in both of those years, the market went on to retest the lows, although the time it took varied widely. After the bottom in 1970, the S&P 500 went on to break the low about 4 1/2 years later, in Q4 1974. In 2001, the index broke to new lows a little more than six months later following the 9/11 attacks.

The good news: Each downtrend of this magnitude (seven straight weeks or more) has marked the low for at least six months. Further, the longest stretch did not exceed eight straight weeks.

The “tldr” is we may endure more short-term pain, but we also could be near an intermediate or potentially even a long-term bottom.

S&P 500’s Performance From the Low After 7+ Straight Weeks of Declines

4 Weeks Later

1 Quarter Later

6 Months Later

1 Year Later

2001 15.4% 13.3% 4.8% 6.2%
1980 11.6% 23% 32.5% 42.9%
1970 7% 19.3% 22.75% 45%

For instance, following the low after each stretch of seven or more consecutive weekly declines, the S&P 500 was higher four weeks later, one quarter later, six months later and one year later. That’s promising.

In 2001 we had a nice initial burst off the lows, climbing 15.4% a month later and 13.3% one quarter later, although those gains faded a bit once we got to the 6-month and 12-month marks.

4. Big Correction in Consumer Discretionary but Still Trading at Premium vs. Historical

LPL Research

5. Factor Returns Year to Date

6. Supply Bottlenecks Disappearing

United States: Supply bottlenecks are disappearing, which means suppliers will have a tough time raising or even maintaining prices.

Source: Daily Shot

The Daily Shot

7. Alternative Investments Go Mainstream

8. CO2 Admissions and Commodities

From Michael Gayed Lead Lag Report

9. Another Covid Chart…Beyond Meat $200 to $25

10. The 15 Rules Every Stoic Must Follow


Topley’s Top 10 – May 25, 2022

1. U.S. Households Could Now Theoretically Repay All Indebtedness

Blackrock Rick Reider

Figure 5: US households could now theoretically repay all indebtedness with cash

2. Tesla Loses 50% of Market Cap Since November

3. S&P 500 has Only Fallen 8 Weeks in a Row 3x Since 1950

Irrelevant Investor-And to top it off, the stock market keeps going down. If the S&P 500 falls this week, it would be just the third time since 1950 that it fell for eight consecutive weeks.

4. Office REITS No Bounce Out of Covid

Jim Bianco

5. S&P Financials Trading at P/E 12

Despite yesterday’s gain, Financials -13% YTD; sector’s undemanding valuation – current P/E of 12 is almost 20% below past 5 years’ average – may reflect concerns about impact of economic slowdown and potential recession may have on banks’ earnings ⁦⁦


From Liz Ann Sonders

6. Thrifting is the new normal

Hope King, author of Axios Closer

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Data: GlobalData via ThredUP; Chart: Baidi Wang/Axios

Buying secondhand is no longer an afterthought.

Driving the news: 93% of shoppers in the U.S. have or are open to buying secondhand products, according to a new report from resale platform ThredUP out this morning.

  • That’s up from 70% in 2019.

Why it matters: We’ve grown increasingly aware of our consumption habits — particularly the youngest consumers among us — and are living in a period of high inflation which has us questioning our purchase decisions.

Details: Nearly 2 in 3 people believe their individual buying habits have a significant impact on the planet, according to a survey of 3,500 U.S. adults.

  • 82% of respondents said they feel a positive emotion when they buy used.
  • 74% said preowned apparel is more socially acceptable now than it was five years ago.

Yes, but: Saving money is the top reason people buy secondhand over new — across all age groups — the study found.

  • Among Gen Z, sustainability is the second top motivator.
  • For average consumers, being able to afford higher-end brands is the second leading motivator.

The big picture: E-commerce technology has matured so much over the past few years that it’s helped to increase the availability of used clothing around the world, whether that’s through dedicated platforms like ThredUP, Poshmark, The RealReal or a closet-sharing service like Tulerie.

What to watch: Big legacy brands are building more ways to resell their own products.

  • Doing so not only helps companies like Oscar de la Renta and Levi’s retain customers, but it also adds a new stream of revenue to their business by taking back what a resale platform may have made on their products.

7. TikTok vs. T.V. vs. NFLX

Scott Galloway

8. Average age of U.S. cars hits record high due to tight supplies, report says


May 23 (Reuters) – U.S. consumers are using their existing vehicles for longer as the inventory of new cars and light trucks remains constrained due to supply chain challenges, marking an all-time high for the average age, according to a report from S&P Global Mobility.

The average age of light vehicles in operation (VIO) in the United States rose to 12.2 years this year, increasing by nearly two months from the prior year, the report said.

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The pandemic led consumers to shift from using from public transport and shared transport to personal cars, and since customers could not upgrade their vehicles, demand for used cars have accelerated and boosted the average vehicle age further, the report said.

Stress on global supply chains worsened in April as COVID-19 lockdown measures in China and the war in Ukraine lengthened delivery times, and air freight costs between the United States and Asia rose, the New York Federal Reserve reported in its latest update to a worldwide index of supply problems. read more

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The average age of light vehicles in operation in the U.S. is expected to rise through 2022 and 2023, as the pipeline for new vehicle production and sales continues to be weighed down by parts shortages, the report said.

Supply chain constraints have led to a decrease in vehicle scrappage, which measures the number of vehicles leaving the vehicle population, and has been a catalyst for the rise in average age over time.

Report ad

The report also said demand for battery electric vehicles (BEVs) in the U.S. has been expanding rapidly over the past few years.

The average age of electric vehicles in the U.S. is 3.8 years of age this year, down from 3.9 last year, and has been hovering between 3 and 4.1 years since 2016.

9. The Increase in Public Home Builders Gross Margins

John Burns Real Estate

10. This Is the Exact Amount of Coffee You Should Drink, According to a Harvard Brain Expert

But don’t make it espresso or French press.


Scientists agree: Drinking coffee is good for you. That’s good news if, like most Americans, you enjoy coffee and perhaps rely on it to help you wake up in the morning or stay alert during the day.

In the last couple of years, more detailed research on coffee has sought to zero in on just how much coffee you should drink every day for maximum health and brain benefits. They’ve found the answer: You should drink three cups. That advice comes from Dr. Uma Naidoo, who’s been described as a “triple threat”: a Harvard-trained psychiatrist, trained nutrition specialist, and trained chef. She’s also the author of the bestseller This Is Your Brain on Food. In an article at, Naidoo explains how she uses coffee as part of her daily routine to boost her own brain function. (Naidoo’s routine includes putting shots of espresso into golden milk, which sounds like a fantastic idea to me.) 

Why three cups? Naidoo points to a study in which researchers tracked both the coffee consumption and cognitive health of 676 elderly men over 10 years. They found that the coffee drinkers had less than half the cognitive decline as the non-coffee drinkers did. And those who drank three cups a day had the least decline of all. A larger Harvard study, with 208,501 participants (both men and women), examined the likelihood of death over more than 20 years. It found that participants who drank coffee were less likely to die early than those who didn’t, with the greatest longevity benefit going to those who drank between 3.1 and five cups a day.

If you want the maximum benefits from your coffee habit, make sure to follow these three rules.

1. Filter it.

Many sophisticated coffee drinkers favor espresso, French press, and Turkish coffee–and some love the Scandinavian tradition of boiling coffee with an egg in it (sometimes including the shell), which pulls together the grounds. Unfortunately, all these versions of coffee can be bad for you. When coffee is made without a paper filter, “oily chemicals called diterpenes come through that can raise artery-damaging LDL cholesterol,” according to the New York Times‘s Jane Brody. Brody, who uses coffee pods, actually dissected one to make sure it contained a paper filter (it did).

2. Be careful what you add.

Coffee may be good for you, but sugar is very bad for you. So if drinking coffee means getting a highly sweetened latte concoction from your favorite barista, you won’t be doing your health any favors–especially when you consider that espresso-based drinks like lattes are unfiltered.

A better strategy is to make your own drip coffee at home, using fresh-ground beans for both better flavor and better control over what exactly goes into your coffee. For added fun, put the $4 to $6 you would have spent at the coffee shop aside for every homemade cup you drink, then use that money for a special treat.

3. Pay attention to your own reactions to coffee. 

This is Naidoo’s advice and it’s an important tip to follow because everybody is different, and each of us may react differently to coffee’s effects. If it makes you feel jittery, cut back your consumption or cut it out altogether. The same holds true if you have trouble sleeping. Caffeine can affect your ability to fall asleep, and also whether you reach the deep sleep stage that your body and brain both need to stay healthy.

At the same time, pay attention to whether coffee lightens your mood, which it might. One of the most intriguing findings from the Harvard study is that coffee drinkers were half as likely to commit suicide as non-coffee drinkers. According to the research, the explanation may be that coffee boosts brain chemicals that have an antidepressant effect.

There’s a growing audience of readers who receive a daily text from me with a self-care or motivational micro-challenge or idea. Often, they text me back and we wind up in a conversation. (Interested in joining? You can learn more here.) Many are entrepreneurs and business leaders, and they tell me that a bright mood and positive attitude makes all the difference when you’re running a business or leading a team.

So the most important question is: How does coffee make you feel? If it makes you feel nervous or interferes with your rest, then stay away from it or switch to decaf. If it makes you feel good, then drink up. Make sure to use a paper filter, and aim for three cups a day.

Correction: An earlier version of this column misspelled Uma Naidoo’s surname.

Topley’s Top 10 – May 24, 2022

1. Russian Economy Imploding…GDP -30%

2. Concentration on Way Up…..Conentration on Way Down…..8 Stocks are Half the Stock Markets Decline.

Found at Barry Ritholtz Blog

3. 1100 Corporate Insiders Buying Stock in May

Bloomberg-ByLu Wang

Investors bailing on stocks because they’re afraid of a recession may want to consider the buying spree that is happening among people in charge of American businesses. 

Corporate insiders, whose purchases correctly signaled the bear-market bottom in 2020, are bottom fishing during the S&P 500’s longest stretch of weekly losses in two decades. They were rewarded Monday, as stocks jumped almost 2% on optimism the US will lift some tariffs on Chinese goods.

More than 1,100 corporate executives and officers have snapped up shares of their own firms in May, poised to exceed the number of sellers for the first month since March 2020 marked the pandemic trough two years ago, according to data compiled by the Washington Service.

4. Precious Metal ETF Flows Turn Positive

Commodities:  Precious metals ETF flows have turned positive.

Source: Daily Shot

5. GDX Gold Miners had a Fast -25% Correction April/May

6. 75% of Companies Mentioning Supply Chain for the Last 3 Quarters


7. Looks Like Supply Chain Issues Loosening….Total Ships L.A. Ports…..

From Dan Stratemeier-Managing Director-Equities, Event Driven Strategies

8. U.S. playing catch-up on electric vehicles

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Data: Global EV Outlook 2022; Chart: Jared Whalen/Axios

9. Pew Research Majority of Americans Favor Exporting Natural Gas to Europe.

61% of Americans would favor exporting large amounts of natural gas to Europe

10. The Hidden Secret All Successful People Have but Don’t Talk About

 Chazz Scott


When most of us think about success in life, we automatically fix our minds upon material items of money, cars, clothes, or power. Many successful people indeed have these items at their disposal. However, many of us get blinded by these symbols of success and misplace where successful people actually receive their source of prosperity, abundance, and wealth.

All wealth, abundance, and prosperity in any aspect of life come from our minds. More specifically, our imagination. Many self-help authors and speakers may call this practice visualization.

Napoleon Hill said, “the imagination is the most powerful, most miraculous inconceivably powerful force that the world’s ever known.”

Why is it so powerful? Because if you cannot see the positive circumstances on the outside, you can build it on the inside, as Bob Proctor would say. In other words, if what you see with your eyes is not what you prefer in your life, you can imagine something different and work toward this image in your mind to reproduce it in your reality.

The Elon Musk way

Do you think Elon Musk could have built SpaceX if he didn’t have a vision or imagination? His goal was to create a fully reusable rocket that achieved a vertical soft landing back on earth. They failed numerous times but kept going. He held on to a future vision of the possible.

Now SpaceX is the first privately owned company to send a liquid-fueled rocket into orbit and the first to achieve a vertical soft landing of a reusable orbital rocket stage

This had never been done. NASA couldn’t do it, and neither could many private companies that had billions of dollars of research and development. And just like that, SpaceX achieved what many thought was impossible. And because of this innovation, money is being saved, making it cheaper to send rockets to space. Now NASA depends on SpaceX’s rockets for their space missions.

So, what did SpaceX have that all these other companies didn’t? They had a leader who had a vision and a vivid sense of imagination. Elon built an image of the possible instead of relying on what always had been. Even though SpaceX’s competitors had basically an unlimited budget, they still couldn’t get the job done. Vision mattered more than money. As Sam Walton, founder of Walmart, has said, “capital isn’t scarce; vision is.”

The Oprah Winfrey story

If that example seems extreme to you, let’s take Oprah as an example. A Baltimore TV producer told her that she was “unfit for television news.” Yet, she didn’t become consumed by her external conditions of what was said – she continued to follow the vision she built in her mind of what was possible. As a result, Oprah is one of the wealthiest people on TV.

Imagination is not something to be taken lately. If you think this is child’s play, that’s precisely what it is. Child’s play got Oprah, Elon, and many others rich and successful. Most people use their imagination as kids but never exercise it as they grow. Forcing many of us to rely on what we can see with our eyes for growth, success, and achievement. This results in stagnation because nothing changes unless you do. Change comes from within, not outside in.

Most people unconsciously use their imagination to guide them toward the very circumstances and conditions they don’t want. Why not use your imagination for success, happiness, health, and fulfillment? 

Unfortunately, if you continue to search for success with your eyes – your success is futile. What do I mean by this? Let’s think about this: every successful person you’ve ever heard about had to rely on vision to achieve their goals. They could not rely on their external conditions to pull themselves to success.

Each of them experienced pain, failure, disappointment, and loss. Still, they continued to follow a vision built with their imagination of what could be possible for them despite the negative they may be experiencing in their external conditions.

Pain is simply a teacher

Michael Beckwith famously said, “pain pushes us until our vision pulls.” In other words, pain is an excellent teacher to tell us how we don’t want to experience life. Once you know what you don’t want to experience in life (removal of pain), then you can begin to develop a future vision for yourself. Then, when your future vision of your success and life is created using your imagination – you will be pulled toward it.

This is when your brain’s reticular activating system (RAS) goes into full gear, finding conditions in your external reality that match the vision you’ve developed in your mind. This is when synchronicities, the right people will call, and things start working in your favor because you’re relying on a higher vision that is propelling you toward the very intention you’ve set for yourself.

Even the bible talks about how you must develop a future vision for yourself. More specifically, it says, “where there is no vision, the people perish.” So, if you have no vision, not only do you parish, but so does everyone around you – family, friends, and anyone that may rely on you.

In order to develop a future vision for yourself and begin to be pulled toward new conditions in your life that you may not be able to see with your physical eyes – you must exercise your imagination.

So, let’s do that now. Where do you want to go? Who do you want to become? What type of people do you want to be around and work with? How do you really want your life to be? What’s a big goal you’ve always wanted to accomplish? Do you want to become more confident, peaceful, or develop a sense of calmness in the face of adversity?

Begin to close your eyes and imagine it first, then work every day towards the dream you’ve developed in your mind. This is the true path to manifesting the life you desire despite the external conditions you may be facing.

As the saying goes, “if you don’t have a dream, there is no way to make one come true.”

Topley’s Top 10 – May 23, 2022

1. Bull/Bear Indicator 1.5 ..Sentiment Can’t Get Much Lower

2. Market Performance During Summer Months

Dorsey Wright

3. Fang Plus Index Still 2000 Points Above Covid Lows.

FANG Index -40%….Covid Low was 2800

4. Right Now…90% of SPACS Below List Price

500+ SPACS in Last 2 Years Underwater

5. Growth Valuation Reset


6. $4 Trillion in Equity Value Lost Emerging Markets

After $5 Trillion Rout, Emerging Markets Seek Turnaround Signal—By Srinivasan Sivabalan and

7. Why the Fed matters to regular Americans, in one stunning chart…Year Over Year Mortgage Payments +43.4%

Myles Udland-Yahoo Finance

8. Nine Months in a Row of Year Over Year Existing Home Sales Declines

Wolf Street-It was the ninth month in a row of year-over-year declines, even as supply of homes listed for sale continued to rise (data via YCharts):

9. XHB Homebuilder ETF -32% from highs

10. Why the Most Intelligent People Love Spending Time Alone

If you crave time to yourself, science says you might be much more intelligent than the average person.


Science says people who socialize more tend to be happier. Makes sense: Relationships, friendships, connections, spending time with people we enjoy… all of that makes us happier.

But that’s not completely true if you’re highly intelligent. If that’s the case, socializing with friends will actually not increase your level of satisfaction with your life.

Here’s why. When researchers followed people between 18 and 28 years old, they found the more most of the people socialized, the happier they were.

How This Tech Founder Runs 4 Companies As a Digital Nomad 

But not the subset of people in the study who were highly intelligent: The more theysocialized, the less happy they were.

Why? Researchers ventured several explanations.

One theory is evolutionary: Greater intelligence lets smart people more easily adapt to a modern world where the benefits of staying in close contact with a social group for food, shelter, protection, etc., are no longer as important.

Another theory was aspirational: The smarter you are, the more focused you will be on longer-term goals — which means spending time with friends can be distracting instead of helpful.

In short, if you’re hanging out with people, you aren’t getting stuff done.

Of course, this is just one study. It may be only directionally accurate.

And the relationship between intelligence and the desire for “alone time” doesn’t necessarily work in reverse.

I’m a prime example: I like time alone… but I’m not particularly bright.

But in your case, if you like to spend time alone working on a project, learning something new, developing your business plan, or grinding away on the things you need to do achieve your goals, don’t assume you’re a loner.

And definitely don’t assume you’re antisocial.

There could be a much better answer: You might just be smarter than the rest of us.

Topley’s Top 10 – May 18, 2022

1. Highest 10% of Volatility Index Levels (VIX) Followed by Strongest S&P Returns

After the highest 10% of weekly closes in the Volatility Index ($VIX above 28.6), the S&P 500 has posted average returns over the next one to five years that are not only positive but well above periods when volatility was lower.

And following the 20 highest weekly closes in the $VIX, we’ve seen the strongest future returns on average.

2. Comparing 3 Bull Markets…..Current Bull Nowhere Near 1999-2000 Bubble.

Ozcam’s Razor: Mean Reversion-by Barry Ritholtz  Occam’s Razor: Mean Reversion – The Big Picture (

3. Cash Levels the Highest Since 2001

Cash levels among investors hit the highest level since September 2001, the report showed, with BofA describing the results as “extremely bearish.”

4. The Percentage of Small Cap Firms that Lose Money is at All Time High

5. Natural Gas Prices Have Doubled this Year….Now Facing Hot Summer.

Natural gas prices have already doubled this year. A hot summer could push them even higherthumbnail



  • U.S. natural gas prices have jumped 137% this year, and they could soar another 25% or more this summer if hotter weather persists.
  • The southern U.S. is hotter than normal, and a heat wave is contributing to higher demand and prices.
  • U.S. supplies in storage are below normal, and the hot weather comes at a time when the industry typically adds gas to storage for the winter months.
  • “The consumer is kind of at the mercy of mother nature at this point for the summer,” said one analyst.

Natural Gas ETF….50day about to go thru 200day to upside.

6. M2 Money Supply Round Trip

Schwab Liz Ann Sonders-More than half of S&P 500 stocks are now in a bear market. The primary culprit is the drain of liquidity, both in terms of the “fiscal cliff” and monetary tightening underway. There are only two other periods in the past 40 years when financial conditions tightened more than they have in the past four months: the Global Financial Crisis and the COVID-19 bear market eras. As shown below, there has been an epic round-trip in M2 money supply growth—helping explain both the market’s surge coming off the pandemic low in March 2020, and the bear market(s) that recently got underway.

Money supply’s round-trip

Source: Charles Schwab, Bloomberg, Federal Reserve Bank of St. Louis, as of 3/31/2022.

M2 is a measure of the U.S. money stock that includes M1 (currency and coins held by the non-bank public, checkable deposits, and travelers’ checks) plus savings deposits (including money market deposit accounts), small time deposits under $100,000, and shares in retail money market mutual funds.

7. Construction Employment Slows Prior to Recessions…An Indicator to Watch

Macro Alf

8. The Gap Between House Payments and Apartment Rents is Expanding

Entry costs for home purchase have spiked. With the typical U.S. home price now pushing toward $400,000 and the average mortgage interest rate rising above 5 percent, a household buying in 2022 has a standard monthly payment that tops $2,300, once taxes and insurance costs are added to the calculation.

That typical monthly mortgage expense is more than $600 above the nation’s average apartment rent of $1,671, according to Institutional Property Advisors (IPA) calculations. The country’s monthly payment premium to buy versus rent housing is at the highest level recorded since the 2006-2007 time period.

Greg Willett

9. Traffic Deaths Back Up Post Covid


Nearly 43,000 people died on US roads last year, agency saysBy TOM KRISHER and HOPE YEN

10. The Best Leaders Have a Contagious Positive Energy

by Emma Seppälä and Kim Cameron

Researchers and leaders have looked for the secret to successful leadership for centuries. Dozens of new books each year promise to deliver the answer. We decided to examine this question empirically, and when we did, we found that the greatest predictor of success for leaders is not their charisma, influence, or power. It is not personality, attractiveness, or innovative genius. The one thing that supersedes all these factors is positive relational energy: the energy exchanged between people that helps uplift, enthuse, and renew them.

Here’s what leaders need to know about positive relational energy, which we’ve found to be the most underutilized yet powerful predictor of leadership and organizational success.

The Importance of Positive Relational Energy

In our work, including interviews with thousands of leaders and employees, an upcoming book, and two decades of research on positive leadership, we’ve looked at people in terms of their networks of relationships: communities, organizations, and families. We’ve observed that certain relationships within those networks are extraordinarily life-enhancing and uplifting. The result is extraordinary performance. In particular, there’s usually one person at the center of these networks who’s responsible for most of the forward motion — not to mention well-being — of all the rest. We call them positive energizers.

Energizers’ greatest secret is that, by uplifting others through authentic, values-based leadership, they end up lifting up both themselves and their organizations. Positive energizers demonstrate and cultivate virtuous actions, including forgiveness, compassion, humility, kindness, trust, integrity, honesty, generosity, gratitude, and recognition in the organization. As a result, everyone flourishes.

The pandemic has taken a significant toll on the well-being and energy of so many. Positively energizing leaders are more crucial than ever. Positive energy, however, is not the superficial demonstration of false positivity, like trying to think happy thoughts or turning a blind eye to the very real stresses and pressures overloaded employees are experiencing. Rather, it is the active demonstration of values.

You’ve met people like this. They’re like the sun. These people walk into a room and make it glow. Everyone becomes energized, enthused, inspired, and connected. These incandescent people are positive energizers. Other members of these networks are depleting: the ones who leave the others feeling de-energized, demoralized, diminished, and uninspired. You know the ones — they sap your energy every time. We’ve given them the name de-energizers.

In our analysis of these energizing and de-energizing individuals in the work environment, we were especially interested in studying the energizing effects of leaders, because leaders are the single most important factor in accounting for an organization’s performance. These studies gave us tremendous insight into the secrets of every successful leader.

Numerous studies run by our group and our colleagues show that positive energizers produce substantially higher levels of engagement, lower turnover, and enhanced feelings of well-being among employees. This is partly because at the cellular level of brain activity, cortical thickness is enhanced through exposure to relational energy, hormones such as oxytocin and dopamine are increased, and at the cellular level in the body, inflammation is reduced and immunity to disease is enhanced. In organizations, superior shareholder returns occur, and in some of our studies, outcomes exceeded industry averages in profitability and productivity by a factor of four or more.

Here’s what differentiates positive relational energy. Physical energy diminishes with use. Running a marathon exhausts us. We need recuperation time. The same is true with the use of mental and emotional energy. We become fatigued and need to recover. The only kind of energy that doesn’t diminish but actually elevates with use is positive relational energy. We rarely get exhausted, for example, by being around people with whom we have loving, trusting, supportive relationships. Positive relational energy is self-enhancing. The ability of leaders to engender relational energy is in fact so powerful that it gives energizers an extraordinary advantage. They can turn around failing companies, resolve seemingly doomed situations, and revitalize disengaged and burned-out employees.

Assessing Relational Energy

Here’s how we identified energizers: We asked members of hundreds of organizations — from mom-and-pop startups to multinational corporations — this question: “When I interact with this person [person X] in my organization, what happens to my energy?” In other words, each person was asked to rate themselves on a scale from very positively energized to very de-energized when they interacted with another person in their enterprise. Each member of a senior team, for example, rated their interaction with every other member of the senior team.

We were astonished by the results of this research. When leaders display positive relational energy, it catapults performance to a new level. More specifically, positive energizers:

  • Are themselves far higher performers than others
  • Positively impact others’ performance, so that other people tend to flourish in their presence
  • Exist in greater numbers at high-performing organizations than at average-performing organizations

When the leader is a positive energizer, the organization has greater:

  • Innovation (the number-one attribute that CEOs look for across industries and countries)
  • Teamwork
  • Financial performance, including productivity and quality
  • Workplace cohesion

And when a leader is a positive energizer, employees have greater:

  • Job satisfaction
  • Well-being
  • Engagement
  • Performance
  • Relationships with family

What Makes Positively Energizing Leaders So Successful?

There is a botanical term for these results: the heliotropic effect. That’s the phenomenon whereby plants naturally turn toward and grow in the presence of light. In nature, light is the life-giving force; photosynthesis occurs only in its presence. Human beings have the same inherent attraction toward life-giving and life-supporting energy. This form of energy is what you receive — and give — in relationships with others.Decades of research shows that this positive relational energy nourishes us and makes us come alive. For example, research by UC Irvine professor Sarah Pressman shows that the need for positive social connection is so great that the lack of it is worse for your health than smoking, obesity, or high blood pressure and reduces longevity. In contrast, positive social connection can not only lengthen our life, but also strengthen our immune system and lower rates of anxiety and depression.

In organizations, these effects are magnified through the leader. That is, leaders’ relational energy has an outsize effect on employees, more so than almost any other relationship at work.

Consider, for example, Ashley Bernardi, founder and CEO of media relations firm Nardi Media. She saw her business revenue double in the span of two years, from six to seven figures — despite the economic upheaval of the pandemic. Bernardi had made one change in who she was when she was leading, and it’s something anyone can learn.

A health crisis in 2016 led her to change direction on how she was leading her company and team. After experiencing a debilitating form of Lyme disease coupled with postpartum depression that left her bedridden after the birth of her third child, Bernardi had a moment of truth. Her illness led to greater compassion and understanding for others. She realized that everyone shows up to work with the challenges they’re facing in their personal lives. As she healed physically and became a more compassionate leader, her business began to blossom. She dedicated time to creating her company core values — which include family and kindness — and made sure to set that example for her growing team and clientele. And for the first time in her life, Bernardi began to take excellent care of her physical well-being and emotional health: She regularly practiced meditation, breathwork, and yoga; took up running; prioritized good sleep; and, yes, even took work breaks and naps. She signed up for Yale’s Coursera course on the science of well-being.

As you can now guess, Bernardi is a positively energizing leader. As she tells the story: “When I learned to put myself first, I saw transformation happen in my life in the most powerful ways: I attracted like-minded team members who lifted each other up and aligned with my core values, one of them being kindness. Our business flourished.”

How Do Positive Energizers Do It?

There’s more to this than the need for employees to feel valued, respected, and engaged; we already know those things are important. When they get recognition, support, and encouragement, absenteeism is low, productivity and profitability are high, and quality and safety improve. But positive energizers catalyze all this and more.

Positive relational energy then becomes reciprocal. An energizing approach to others acts as a continual energy-boosting mechanism, which, in turn, produces an abundance of energy in the whole network. Energizers reproduce themselves, building networks of positive energizers around them, and that heliotropic effect expands to attract still more. To paraphrase the proven leader Dolly Parton: If your actions inspire others to dream more, learn more, do more, and become more, you are a positive, energizing leader. Many studies on positive leadership demonstrate that leaders focused on contributing to others are substantially more effective than leaders focused on personal achievement and success. Their organizations and their employees excel.

Can organizations flourish with leaders who deplete rather than generate energy? Of course — in the short term. But the empirical evidence is clear that positive energy is far more effective long term. Over time, employees become averse to de-energizing and life-depleting leaders, and that’s not a chance leaders can take during the Great Resignation (nor, we would argue, in economic boom times, either). That heliotropic energy will renew itself many times over, and inspire focus, trust, and sincere investment in your goals. Your employees will turn toward the sun.