Financial Forecast For The Week of February 2, 2009

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The lines of communication begin to become clearer now that Mercury has slowly begun moving forward* again. The news flow gains momentum Wednesday and Thursday with the Moon in Mercury-ruled Gemini.

The stock market could get very volatile approaching the end of the week due to multiple planetary alignments. These alignments build upon the energies established earlier in the week.

The Moon in Taurus Monday and Tuesday puts the focus on money and personal finance in general, reflected by Monday morning’s economic report on personal income and spending for December, and Tuesday afternoon’s House Financial Services Committee hearing on promoting bank liquidity and lending. The stock market could show its strongest performance during the first two days this week. The First Quarter Moon in Taurus occurs at 6:13 PM EST Monday, right in the middle of the January 26 Solar Eclipse in Aquarius and the February 9 Lunar Eclipse in Leo, indicating changing conditions relating to banking and finance, and investor reaction to it. What occurs between January 26 and February 24 will unfold over the next six months.

Taurus is ruled by Venus, the planetary energy of attraction. Late Monday evening Venus moves into Aries until June 6, a lengthy stay as Venus will be retrograde March 6 to April 17. The cycle of Venus in Aries challenging Pluto in Capricorn with both affecting the USA’s natal Venus in Cancer represents the time that the government begins to fully play its high stakes game as the nation’s banker and hedge fund manager.

The Senate could vote on the $900 billion economic stimulus package as early as Tuesday. It’s obvious that the Administration will not release their plan for the banks (what the FT calls the “Big Bang” bank plan) until the stimulus passes because the price tag of the combined plans will be even more frightening than the stimulus alone.

The market could get choppy and drift down Wednesday on conflicting economic information. Mercury in Capricorn puts the focus on government regulation. Obama Economic Advisory Board Chairman and former Federal Reserve Chairman Paul Volcker will be presenting his recommendations for modernizing financial regulations at a Senate Banking Committee hearing this afternoon.

Saturn in Virgo and Uranus in Pisces will oppose each other on Thursday. Saturn is economic contraction, and in Virgo it represents cleaning up the mess caused by the financial bubble and getting back to basic banking. Uranus in Pisces is an urgent wakeup call warning that you cannot solve the problem using the same type of methodology that got you there in the first place. Excessive leverage has relocated from Wall Street to Maiden Lane, as the Federal Reserve is a hedge fund leveraged at 50:1.

For Saturn and Uranus to have their second standoff at the time of the January employment report is going to show a contraction in the workforce (Virgo) that is more severe than projected. Uranus in Pisces reflects the shock that jobs are disappearing in sectors that have traditionally been considered recession proof such as healthcare. Specifically this would be at hospitals, assisted living/nursing homes, and psychiatric facilities. The rising level of unemployment is likely to bring labor unrest that could break out around the time of the March 10 Full Moon in Virgo. And just like the first pass of Saturn/Uranus that occurred on Election Day, the stock market will probably wildly gyrate from one extreme to another (but more likely down) as Uranus likes to break through historical (Saturn) support and resistance levels.

At the same time that Saturn opposes Uranus, Venus in Aries will challenge Pluto in Capricorn. Unsecured debt will come from the back to the front of the financial arena. Personal bankruptcies rise. Acquisition agreements could come undone.

Venus/Pluto opposing the USA Venus reflects the government is not only spending taxpayer money to prop up US banks, but as an article in today’s Barron’s** reminds us, the Fed is helping to prop up European banks through lending $500 billion plus in currency swaps. And with all this epic government spending in the pipeline, the Barron’s article brings up another Venus/Pluto problem of what happens if other nations don’t want to buy our debt anymore? Barron’s reports it’s already happened in Germany after only 68% of 10-year government bonds sold at auction, a failed auction.

*Planets do not really move backwards but appear to from Earth’s vantage point.

**Barron’s: “Europe’s Growing Crisis Puts the Fed at Risk” by Jack Willoughby (Unfortunately this link to Barron’s does not provide the complete article.)

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