Week of January 21
Please note that there will be no weekly column next week due my presence at the Pluto in Capricorn symposia in Zurich, Switzerland. With the time difference, it will just be too late on Friday night to complete it.
Review and Preview
Stock markets around the world continued their plunge all last week. Many fell to new yearly lows, and many others are now testing their lows of last August. In the United States, both the Dow Jones Industrial Average and NASDAQ Composite have now fallen well below their lows of August 16. In fact, these indices are now immersed in their steepest declines since the 4-year cycle of late 2002, early 2003. The DJIA, for instance, has now fallen over 2000 points and over15% from the crest of the 4-year cycle back on October 11. This supports our views that this 4-year cycle has stretched out to six years for the first time since the 1932-1938 instance.
In Europe, both the Swiss stock index and the Netherlands AEX have now made new yearly lows. But in England and Germany, the FTSE and DAX respectively are still holding those lows of August, but not by much. The DAX, for instance, fell to 7287 intraday on Friday, still above the 7190 low of August 17. The FTSE fell to 5856, just barely above the 5821 low of the same day.
In Asia and the Pacific Rim, we find the Japanese Nikkei falling below its 14,045 low of June 2006. The Australian All Ordinaries plunged to 5799 on Friday, which is still above its lows of August. The Hang Seng fell to 23,957 last Thursday, still well above its lows of August 17. And in India, the NIFTY index fell to 5677, which is back to the levels of only last December 19.
In other markets, Crude Oil continued its decline from the 100.00/barrel mark, falling below 90.00 last week. Gold and Silver both made new all-time or multi-decade highs early last week, then fell sharply into Wednesday before recovering somewhat into Friday. The European currencies however, continued to fall into Friday after posting secondary highs last Tuesday.
Monday, January 21, will mark the third of five passages of the Jupiter-Saturn trine. As stated in last week’s column, “The first two passes were in fire signs, back on March 16 and May 6. The March 16 date was just two days after the end of a very sharp 2-3 week stock market sell-off. May 6 was one day before a crest in the NASDAQ Composite, followed by a modest sell-off into May 16. But now we begin a series of three more of these passages, but in earth signs. From our studies reported in our Stock Market Timing series books, it is not unusual to see a 4-year cycle in U.S. stocks form within one month of one of these middle passes. That means any low forming now—or with the next passage, which is September 8—could be the 4-year cycle trough (which is now stretched out to 6 years for the first time since 1932-38).”
Venus will also begin its ingress of Capricorn on January 24, lasting through February 17. For the first 8 days of this ingress, it will cross the Jupiter-Pluto conjunction in early Capricorn. When these two planets (Jupiter and Pluto) conjoined on December 11, the stock markets of the world made a peak, and the current sell-off began for many of them. Thus we now watch to see if they can post a significant rally into January 24-February 1, the time band in which Venus translates the Jupiter-Pluto conjunction, much like they did into December 11.
There is a lot of fear in the market place today, consistent with Jupiter in Capricorn. But if history serves as an accurate guide again, one would expect the market to find support within 10 trading days of the trine between Jupiter and Saturn. And it is interesting to note that we are fast approaching our 20% minimum decline level that defines 85% of the declines from the crest to the trough of the 4-year cycle.
Fellow market timer and colleague Garrett Jones (firstname.lastname@example.org) asked me the following question for a CD he is producing: "If someone gave you $5 million to invest over the next couple of years and you had to break it down and then not touch it over that time, how would you do it?" I asked his permission to share my answer on this column, because I thought it might be of interest to readers.
Where would I put 5 million? If a Republican wins the Presidential election, I would put this money into Gold and foreign currency backed income funds, diversified across the globe in both "neutral" countries and commodity producing counties, like New Zealand, Singapore, Canada, even Switzerland, as you and I discussed 4-5 years ago. That was the best time to do it. But if a Republican wins, that time is not over, for I believe the Dollar could continue to crash as the U.S. escalates war involvements and hence heads toward a national bankruptcy threat and collapse of U.S. Dollar. Of course, this outlook may be altered depending upon which Republican wins. But if it is war-hawk in the tradition of the current administration, then I hold to this outlook.
If a Democrat wins, I would simply place most of it in money markets funds (US $ based), for I think it means higher taxes, higher interest rates, but also a more stable dollar—unless it is too late. I would also continue investing in Corn through 2010, and farm equipment (2008 only). And probably something that benefits from oil prices going down (short an Oil-related ETF?). If I was not worried about the effects upon the earth and its people, I would also invest in weapons development of companies in foreign countries, because I believe strong armies will begin to build everywhere but in the USA. But my conscience will not permit me to make this type of investment this personally.
These views, by the way, are based upon the cyclical pattern of the U.S. Dollar related to recent presidencies, the Saturn-Uranus-Pluto T-square coming up in 2009-2010, plus Uranus moving from Pisces (Crude Oil) into the war-like sign of Aries (2011-2019), and squaring Pluto seven times along the way (2012-2015). And for the record, I don’t know the fundamental reasons why Crude Oil would come down in price while weapons development in foreign countries increases. It seems to me to be a contradiction. But this is what my understanding of cycles and astrological signatures suggest, and I find they tend to happen accordingly regardless of my sense of logic beforehand.