WallStreetWeather.net Forecast For Week Of April 27, 2009

Summary Of Last Week’s Influences:
Planets appearing to change direction from Earth’s vantage point (retrograde) tend to correlate to changes in market sentiment, however briefly. In last week’s forecast I wrote that Venus moving forward again increased the potential that the gains in the indices and bank stocks in particular since Venus went retrograde March 6 could reverse.

Venus represents banking and finance, and last Monday’s sharp decline occurred on the first full day of trading that Venus was direct. I didn’t think the negativity would be that severe, but I should have known better that when you’re in a banking crisis, Venus changing direction is going to have an even more potent effect. With Mercury in Taurus, news related to banks drove the indices down as bank stocks tumbled on downgrades, and the market dissected Bank of America’s (BAC) quarterly earnings report with its $13.3 billion provision for credit losses. The Administration’s new proposal to convert the government’s preferred shares in TARPed financial institutions to common equity didn’t help matters. Warren Buffett called this (TCE) manipulation illusionary, citing that there’s no difference in a bank’s capital between common stock equity and preferred stock equity. Both forms of capital are a first line against losses. Even three merger announcements couldn’t keep the market from sinking.

The markets turned positive the following day after Treasury Secretary Geithner said at a hearing that the “vast majority” of the nation’s banks are well capitalized. Geithner said all the government’s different rescue efforts are showing “mixed signs” of success. Beyond the financial sector, corporate earnings have not been good, but the market has continued to climb as earnings have not been as bleak as expected. Microsoft (MSFT) reported the first year over year revenue decline in its history as a public company, yet the stock gained almost $2.00 Friday. Jupiter about to conjoin Neptune in futuristic Aquarius on May 27 explains the market’s optimistic hope for an economic recovery to occur later this year led by technology related shares.

The DJIA and the S&P500 ended the week slightly lower, but the Nasdaq concluded its seventh straight week of gains. Jupiter and Neptune in Aquarius this year is pumping up the Nasdaq, and “rekindling” the shares of some of the late 1990s internet/tech bubble darlings such as Amazon.com (AMZN) which recently had a Jupiter return.*

Venus rules copper which had risen just before and during Venus retrograde (March 6 – April 17). Last week copper fell on profit taking after its rapid run. However, Venus moving forward again reversed the decline in crude oil and boosted gold prices last week. Crude oil is ruled by Neptune. Its rise last week in particular reflects the Jupiter/Neptune theme that these commodities are not rising on demand fundamentals, but rather as a hedge against inflation and any signs of weakness in the US$ from our mountain of debt (Pluto in Capricorn opposing the USA’s natal Venus).

Summary Of This Week’s Influences:
Wednesdays are ruled by Mercury, the planetary energy of communication. Many events this week will take place on Wednesday. President Obama will hold a news conference at 8:00 PM EDT. Bank of America’s annual shareholder meeting takes place Wednesday, and several pension funds have said they intend to vote against reappointing Ken Lewis as Chairman.

The FOMC will issue its announcement at 2:15PM EDT Wednesday following its two day meeting. Venus, Mars, and Pluto challenging the Federal Reserve’s Capricorn Sun and Pluto in Cancer now increases the scrutiny of the Fed and its leadership. The FOMC announcement will likely show an expansion of its lending programs with a loosening of collateral requirements, as participation in its lending programs has not been as high as the Fed would have liked.

Mercury enters its “home” sign Gemini Thursday until May 13. Complete important communications and documents before Mercury goes retrograde May 7. Mercury retrograde May 7 to 30 tends to create choppy trading conditions that take the market on a ride that can end up where it initially started.

Venus in Aries makes its final challenge to Pluto in Capricorn on May 2. While the previous alignments (February 5 and April 3) were positive for the market, the final alignment has the most influence. These energies increase the probability of more bankruptcies and more government involvement in financial institutions in particular. Regardless of what’s being talked about now for Chrysler and General Motors (GM), the Summer Solstice chart (June 21 at 1:46 AM EDT) for the US looks like there are two major bankruptcy filings and Michigan is a hot spot. Unemployment appears to continue to rise over the summer.

Monday, April 27, 2009
Expect a large move with a potential for reversal.

Tuesday, April 28, 2009
Negative early but starts to show improvement by early afternoon.

Wednesday, April 29, 2009
Choppy to negative trend bias.

Thursday, April 30, 2009
Choppy/mixed to positive trend prevails most of the day, but begins to weaken approaching the final hour.

Friday, May 1, 2009
Negative trend bias.

*Jupiter returned to its natal position when AMZN went public (May 15, 1997). This occurs about every 12 years. Jupiter is usually considered a beneficial influence, but the energy of expansion and optimism can just as easily turn into exaggerated panic and hysteria.

No disclosures.

Bernanke Behind Threat To Oust Lewis & BofA Board If Merrill Deal Didn’t Happen

Who forced Bank of America (BAC) to complete the merger with Merrill Lynch when Merrill’s fourth quarter earnings looked like a disaster? All fingers point to Federal Reserve Chairman Ben Bernanke.

New York Attorney General Cuomo deposed chief executive Ken Lewis and former Treasury Secretary Hank Paulson as part of an investigation into bonuses paid by Merrill shortly before its merger with BofA. Lewis admitted that Paulson and Bernanke threatened to oust him and Bank of America’s senior management along with its Board of Directors if BofA invoked a MAC (material adverse change) to back out of its deal to acquire Merrill. “Secretary Paulson has informed us that he made the threat at the request of Chairman Bernanke,” Cuomo wrote in a letter to Sen. Dodd, Rep. Frank, SEC Chairman Schapiro, and TARP Oversight Chair Warren that summarized his investigation into the secrets kept from shareholders and taxpayers about the deal.

Federal Reserve Chairman Ben Bernanke likes to tout his efforts to bring greater transparency to the Federal Reserve. But actions speak louder than words. From the collapse of Bear Stearns and Lehman Brothers to using AIG as a conduit, Bernanke’s Fed has been anything but forthcoming in their actions. Cuomo writes: “We do not yet have a complete picture of the Federal Reserve's role in these matters because the Federal Reserve has invoked the bank examination privilege.” Essentially the Fed is claiming that information related to this matter is “sensitive” and was provided to the Fed confidentially. This is how Bernanke defines “transparency.”

In “Government Forced Bank of America To Marry Merrill Lynch,” I described how Bernanke and Paulson pressured Lewis not to back out of the deal, offering BofA a Citi-style rescue after the deal was completed. However, in questioning by the AG’s office, Lewis recounts that it wasn’t until a December 21 phone conversation that Paulson threatened the removal of Lewis, the management and the bank’s Board if they called off the deal. After Lewis told Paulson he would talk to the Board about it, Paulson said “Good; I’ll call Ben and tell him that.”

Now the focus turned to additional government assistance to help BofA absorb Merrill’s losses. BofA’s Board wanted the government’s commitment to the merger in writing, so Lewis called Bernanke and asked him if he would comply. To which Bernanke replied, “Let me think about it.” Bernanke never called back. Instead Paulson called to say that “this would be a disclosable event and we do not want a disclosable event.” Lewis reiterates that “I was instructed that we do not want public disclosure,” but didn’t recall if the “we” referred to Bernanke or Paulson.

Lewis said that no one considered that part of the oral agreement was a commitment for financing which would therefore require disclosure to the SEC. He said it was either Bernanke or Paulson who told him the deal needed to close on time under its original terms. Bernanke and Paulson’s intensity about consummating the merger shows they knew they had made a colossal mistake by allowing Lehman to collapse and did not want a repeat.

The minutes of the December 30 BoA Board meeting describe that Bernanke instructed BoA management to communicate with Kevin Warsh. However, Lewis tells the Board that Bernanke “had assured him the Corporation would not be penalized by accepting the commitment of the federal regulators and that acceptance of the commitment would be beneficial to the Corporation and its shareholders.” Two days before the January 1 merger, Lewis told the Board that the details of the government’s commitment had not been finalized.

Were BofA shareholders sacrificed for the good of the financial system as a whole? Was it proper and legal for BofA to fail to disclose to the shareholders and not invoke the MAC clause when BofA clearly knew it was not in their best interest to consummate the deal? Is Bernanke guilty of conspiring to force Ken Lewis in breaking securities regulations related to disclosures?

Bernanke can attempt to stimulate the economy through negative interest rates and all kinds of liquidity enhancement programs, but none of this will replace the confidence lost by Bernanke's Fed sacrificing the trust of shareholders.

No disclosure.

WallStreetweather.net Forecast For Week Of April 20, 2009

Summary Of Last Week’s Influences:
Last week began with the Moon in Jupiter- ruled Sagittarius, putting the focus on foreign relations and economic philosophy with a religious foundation. On Monday President Obama announced he would lift communications and travel restrictions with Cuba.

The next day, the President and Fed Chairman Bernanke gave speeches that used religious parables. The President explained his “Five Pillars” to build a foundation for economic recovery, believing that the first pillar is to have the government recreate the bubble that got us into this economic mess in the first place. (The key pillar here is that even Larry Summers endorses healthcare reform.) Even though the indices continued to gain last week, March retail sales results Tuesday kept the market down all day. The US and China will have to learn the hard way that US consumer spending can no longer comprise 70-75% of the US economy.

Speaking of consumers, General Growth Properties (GGP), the second largest US mall operator, filed for Chapter 11 bankruptcy Thursday. I’ve written about the rise of commercial and retail bankruptcies, and this is just the tip of the iceberg. Beyond reduced consumer spending, General Growth was one of the largest users of commercial mortgage-backed securities (CMBS). According to The Wall Street Journal, CMBS were originally created by the RTC after the S&L crisis to package groups of mortgages to sell as securities to buyers with various risk tolerances. The Journal quotes a report by Deutsche Bank (DB), estimating that $154.5 billion of CMBS loans will come due between now and 2012, and DB estimates that two thirds of these loans won’t qualify for refinancing. Now the Fed is considering allowing CMBS into its TALF program. This shows you how berserk Bernanke has went with these programs that he would even consider a mall operator to be a systemic risk.

Bernanke’s speech Tuesday was “Four Questions About The Financial Crisis,” a takeoff of Passover. I only have one question for Bernanke: What is your exit plan to unwind all the excess liquidity in the system? Having an exit off of I-95 christened “The Ben Bernanke Interchange” just doesn’t cut it. The exit is for Dillon, South Carolina, the home of “South of the Border.” But that’s a parable that Bernanke would prefer not to elaborate on.

President Obama could start fixing his first pillar by putting Paul Volcker in charge of the Fed and the Treasury. After all, they’re one in the same now.

Summary Of This Week’s Influences:
There are some major planetary shifts this week, and they all relate one way or another to banking and financial values.

Ruled by Venus, Taurus rules banks, money and tangible assets. Mercury moved into Taurus April 9, the day that Wells Fargo (WFC) announced they expect to earn a $3 billion first quarter profit. Today the Sun enters Taurus until May 20. During this time we will see if the indices and bank stocks in particular, continue their bullish bias that began after Venus turned retrograde*** March 6. Venus turned direct April 17, increasing the potential that the market’s gains since the March 6 lows were a temporary reversal.

As the first sign of the earth element*, Taurus energy tends to proceed with caution, taking a slow and steady approach to investing. Taurus energy needs to be assured that equity gains are supported by solid fundamentals. Taurus is a fixed** sign that can be slow to respond to changing conditions. Taurus energy tends to hold on to investments too long, trying to inch out more profit, stubbornly believing that the stock will bounce back.

Since the Sun rules speculation and the heart, and Taurus rules banking, it was no surprise to me that the government is scheduled to release a “white paper” on Venus-ruled Friday, the day of the Taurus New Moon. The report will outline the criteria used in the stress test the Federal Reserve and other banking regulators administered to assess the health of the 19 largest financial institutions that received TARP.

Regulators could begin informing banks of preliminary results beginning April 24, and the government is scheduled to publicly release some of the test results on May 4. Bloomberg reports the government has “no set plan for how much information to release, how to categorize the results or who should make the announcements.” Operating without a clear cut plan and providing few details are what caused markets to plunge February 10 when Treasury Secretary Geithner announced the government would begin stress testing the banks. Announcing a plan with no details did not sit well with the market as the Moon was in Virgo then. The government better quickly get their act together as the Moon will again be in Virgo on May 4. Moon in Virgo energy requires the minutest level of detail possible to feel secure.

The Moon will be in Pisces Monday and Tuesday, highlighted by Venus and Mars in Pisces conjoining on Tuesday, providing a brief escape flight of fantasy.

By mid morning Wednesday the Moon has entered Aries (until mid-afternoon Friday) and so has Mars, the planetary ruler of Aries. Mars will be in its “home” sign until May 31. Alan Abelson’s column in Barron’s (“Don’t Bank on It”) perfectly describes Mars/Aries energy: “hit and run investing.” And contrary to what the Bloomberg article linked to above says, this energy does not usually have “six minutes” of patience. This impulsive energy acts first and asks questions later. Venus re-enters Aries Friday until June 6. (Venus was previously in Aries February 2 to April 11.)

When you put it all together, it appears that volatility is going to increase this week as bearish sentiment begins creeping back in even though it is still likely to get interspersed with bursts of sharp upside surprises. Uranus energies represent the future. As earnings season gets in full swing this week, the market wants to know the corporate outlook for the months and year(s) ahead . Jupiter will conjoin Neptune in Uranus-ruled Aquarius on May 27. Jupiter relates to growth and expansion; Neptune credit, inflation, and the art of illusion. Uranus is always a wild card. These energies can continue their euphoric ride or just as quickly expand into another hysteria-induced financial tsunami with Uranus in Pisces. (Think about last year’s oil bubble that burst.) Neptune rules market bubbles, and this time the bubble isn’t just government endorsed but 100% government born and bred.

Monday, April 20, 2009
Swings from negative to choppy/mixed conditions to moderately positive.

Tuesday, April 21, 2009
Negative; improves to choppy/mixed to moderately positive.

Wednesday, April 22, 2009
Volatility picks up as market reacts to mixed pieces of news (choppy/mixed). Could see improvement going into the close.

Thursday, April 23, 2009
Negative; could bottom in mid afternoon and begin to improve.

Friday, April 24, 2009
Choppy, creating potential for sharp moves in either or both directions. Mercury in Taurus challenging Neptune in Aquarius obscures the ability to accurately measure true value now.

*Virgo and Capricorn also comprise the earth element.

**Leo, Scorpio and Aquarius are the other fixed signs.

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

Related Article:
Bloomberg: “Fed’s Kohn, Dudley Defend Size, Scope of Emergency Loan Plans”

No disclosures.

Goldman Sachs Owes Taxpayers More Than TARP

Published by WallStreetWeather.net

“Missing time” refers to a person who has a memory gap covering a certain period of time. In recent years the term has been used to describe a gap in time that the person cannot account for that under hypnosis might be attributed to an extraterrestrial encounter.

While it’s unlikely that chief executive Lloyd Blankfein or any other members of the management team at Goldman Sachs (GS) have experienced a close encounter of the third kind, perhaps a hypnotherapy session would help Goldman to have better recall of the events of the last six months so it can be grateful rather than disdainful the government rescued it from its near death experience.

Just as the short sellers were closing in on Goldman and Morgan Stanley (MS) after Lehman Brothers collapsed last September, the Federal Reserve called an emergency meeting Sunday evening September 21 to allow the two investment banks to become bank holding companies. The next day the Justice Department waived the five day antitrust waiting period. Even though Goldman and Morgan do not function like a commercial bank and have no intention of doing so, their newfound status gave them access to the same government programs as the commercial banks.

When Goldman reported first quarter earnings on April 14, it marked the six month anniversary of receiving a $10 billion equity injection from the TARP. Goldman chose to mark the occasion by raising $5 billion in a secondary offering in order to fulfill what CFO David Viniar describes as their “patriotic duty” to return the $10 billion TARP money to the Treasury.

Now that Goldman is convinced the government would never allow it to fail, Blankfein and Viniar have developed their own version of missing time. Goldman has received billions of dollars in benefits courtesy of US taxpayers beyond the $10 billion TARP. Since Bear Stearns collapsed in March 2008, Goldman has had access to the Fed’s discount window. Instead of negotiating with Goldman over CDS contracts with AIG as the New York Insurance Department did with Merrill Lynch and XL Capital, the Fed’s Maiden Lane III paid Goldman at par if collateral already received from AIG is factored in.

Is it an equitable tradeoff for Goldman to be released from TARP restrictions simply by paying back the TARP itself while retaining access to FDIC-backed financing and all the other perks of a bank holding company? I believe this is a disingenuous argument on Goldman’s behalf. Estimates have ranged from $21 billion to as high as $40 billion in media reports of Goldman availing itself to cheap government guaranteed financing via the FDIC and other programs.

It’s hard to really know how secure Goldman is as a bank. We know you can’t enter one of their “branches” and make a deposit, let alone receive a free gift for opening an account. And then there’s the missing month of December that even the financial publications can’t decipher. All we know is during hypnotic regression, the patient could not create a framework around December’s $2 billion+ loss.

When you add it all up, it’s difficult to believe Goldman can be trusted as a bank and should be set free from strict government oversight. The proud and mighty Goldman may yet face another near death experience later this year and come crying back to the government again. If Goldman is arrogant enough to want to be set free now then the next time around they should be allowed to fail.

With an almost $1 trillion balance sheet supported by only $42 billion in common equity, Goldman is more casino than commercial bank. Perhaps Goldman should have asked Bernanke for a gaming license instead and relocated its headquarters to Las Vegas.

No disclosures.

Foundation Replaces The Lipstick Index

Published by WallStreetWeather.net

Estee Lauder (EL) Chairman Leonard Lauder coined a new economic indicator during the 2001 recession that became known as the lipstick index, after observing the correlation between economic downturns and lipstick sales. “When lipstick sales go up, people don’t want to buy dresses. When things get tough, women buy lipstick,” Lauder remarked at the time.

As reported on the front page of Saturday’s Financial Times, evidence is growing that in this recession, sales of foundation have surpassed lipstick sales in the UK and US. The FT reports that in the US in 2008, lipstick sales fell 5.8% while liquid foundation sales grew 2.5%. According to L’Oreal, more 18 to 19 year old women cited foundation as their “must have” beauty product over lipstick. Only women over 60 valued lipstick as more important.

Foundation’s growing popularity is reflected in the planetary cycles of Saturn in Virgo (Sep 2007-Jul 2010)* and Pluto in Capricorn (2008-2024), as Saturn and Capricorn rule the skin. These planetary energies demand more from a beauty product than a mere pick me up. They need to provide value and a natural yet polished appearance since these energies relate to work and professional reputation.

Saturn rules time and Virgo efficiency. Foundations at all brands and price points have become multitaskers, saving money by eliminating the need to purchase multiple products. Today’s foundations contain sunscreen, moisturizers, and ingredients that claim to correct uneven skin tone. The foundation trend will continue under Saturn in Libra* (Jul 2010- Oct 2012) as Saturn in this Venus-ruled sign values a radiant looking complexion.

Lipstick is not going to make a woman look any younger. Besides, prestige brand consumers can always get a free lipstick when they buy foundation during the brand’s gift with purchase promotion.

*Saturn will also be in Libra from October 2009 to April 2010

No disclosures.

Wall Street Weather Forecast For Week Of April 13, 2009

Summary Of Last Week’s Influences:
As I wrote in last week’s forecast, “Doubt and increasing volatility looks to be slowly seeping into the bullish outlook.” Last week began with the Moon (emotions) in analytical Virgo Monday and Tuesday. A research note by CLSA’s Mike Mayo on “The Seven Deadly Sins of Banking” and comments by Meredith Whitney on CNBC got the week off to a negative start. Both analysts estimate that the bank’s valuations of loans on their books do not reflect permanent impairments.

When the market opened Wednesday with the Moon in Libra, negative sentiment was weighed with a variety of factors that could be viewed in a more hopeful context. (Libra energy tends to gloss over anything unpleasant.)

Libra energy also can be indecisive. The SEC met Wednesday to consider five different proposals that would reintroduce some type of “uptick rule” to curb abusive short selling. The uptick rule was instituted during the Great Depression and abolished by the SEC on July 6, 2007. Mercury was retrograde* in Cancer, indicating a high probability that the SEC will re-establish some type of breaker to prevent traders from slamming a stock.

The abolishment’s Mercury conjoins the USA’s natal Venus (nation’s wealth). Transiting Venus and Pluto are currently impacting these placements. Pluto-ruled hedge funds and private equity are for the most part against the SEC reinstating any type of restriction on shorting. Venus conjoining Saturn in Leo at the time the rule was abolished reflects the loss (Saturn) of money, particularly in bank stocks (Venus) that has occurred since the rule was abolished. Clearly there must be a Libra balance struck between shorting and deliberate efforts to destroy companies.

And it seems the ongoing saga of some type of Microsoft (MSFT)/Yahoo (YHOO) linkup couldn’t wait until Mercury turns retrograde next month. Since the two companies are talking about forging an internet partnership rather than a merger this time, they must have thought that Venus retrograde (March 6–April 17) would be a good time to restart their talks.

Summary Of This Week’s Influences:
Mercury entered Taurus at the time of last Thursday’s Full Moon. Taurus rules banks, and banks and the overall market rallied after Wells Fargo (WFC) CFO Howard Atkins said the TARPed bank expects to earn a first quarter profit of $3 billion. The market focused on the bank’s big boost from its FDIC-arranged acquisition of Wachovia. However, much of that boost is probably due to the “kitchen sinking” of Wachovia’s balance sheet.

A couple of weeks ago Wells’ Chairman called the government’s stress testing of the 19 largest banks “asinine.” The government is expected to announce the results at the end of the month after these banks have reported earnings. Mercury will be in Taurus until April 30 and again from May 13 to June 13 due to Mercury being retrograde May 7-30. This correlates to the time when the government will tell some or all of these banks to either raise more capital or face an additional government injection.

Taurus is ruled by Venus. Since Venus went retrograde on March 6, the indices have largely reversed their sentiment. Yesterday Venus moved back into Pisces where it last sojourned at the beginning of February, close to where the DJIA and S&P500 are now.

Venus moves direct on Friday and will remain in Pisces until April 24. Pisces and its planetary ruler Neptune can create confusing and misleading conditions that make it difficult to accurately assess what’s really happening. Jupiter and Neptune are about to conjoin next month, which explains why President Obama sees “glimmers of hope” across the economy, and 53 out of 54 economists surveyed April 3-6 by The Wall Street Journal expect the recession to end in September. Andrew Wilkinson, a senior market analyst at Interactive Brokers, describes the current market sentiment as “contagious euphoria,” one way to describe the Jupiter/Neptune alignment. The key phrase of this planetary pair is overblown hype (which can go in either direction).

As I’ve written before, I look at Jupiter/Neptune as a hot air balloon that is likely to get punctured. Late summer to September at the latest is when the market is likely to break through the March 6 lows.

Mars conjoins Uranus in Pisces early Wednesday, increasing the potential for accidents, rebellious behavior, and surprise military action. This alignment can manifest severe weather conditions, earthquakes, and tsunamis. Power outages, computer systems, and all kinds of electronic devices have a greater tendency to malfunction now.

Unsettled and uncertain could be the best way to describe the stock market this week.

Monday, April 13, 2009
Negative trend bias could show improvement and even reverse later in afternoon.

Tuesday, April 14, 2009
Negative to choppy/mixed; strongest in early afternoon. Could weaken in the final hour.

Wednesday, April 15, 2009
Markets volatile and could move in either or both directions, but most likely sell off.

Thursday, April 16, 2009
Negative trend bias.

Friday, April 17, 2009
Choppy/mixed to positive trend bias. (Options expiration.)

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

No disclosures.

Cyberspies Penetrate Vulnerable U.S. Infrastructure

National security officials revealed that cyberspies traced to China and Russia infiltrated the nation’s electrical grid and other infrastructure systems. The Wall Street Journal (“Electricity Grid in U.S. Penetrated By Spies”), reports cyberspy intrusions of infrastructure systems are growing across the U.S. due to increased reliance by utilities on internet communication.

Just as Mars (action/attack) will reach conjunction with Uranus (computer systems/electricity) next week, the Obama Administration is due to complete its cybersecurity review of the nation’s infrastructure systems. Mars/Uranus conjoined in Pisces represents cyberspies who search for an opening in a system’s network, placing software that remains asleep (Pisces) until activated for a surprise attack. In general terms, Mars/Uranus can increase the potential for power outages (from earthquakes and storms), system malfunctions and crashes and hacker/virus outbreaks.

Pluto rules spying, nuclear energy, revenge, and extortion. These issues have been more prominent in the news because Pluto is stationary March 31 to April 9, having turned retrograde* April 4. The biggest concern among officials is if a nuclear plant came under cyber attack. In addition to reflecting the financial crisis, Venus challenging Pluto now can also represent cyberspies infiltrating financial networks.

Pluto in Capricorn (2008-2024) represents an urgent call to transform infrastructure and the computer systems that support it. Capricorn reflects outdated infrastructure and technologies. Capricorn is ruled by Saturn, and from 2008 to mid 2010, Saturn in Virgo is opposing Uranus in Pisces. This is a preparatory cycle; the country has only a limited amount of time to secure our infrastructure against very sophisticated cyberattacks.

Problems affecting the nation’s infrastructure, computer systems, communication and transportation systems could arise around the time of the New Moon on September 18, 2009 as the Sun/Moon and Mercury retrograde challenge Saturn, Uranus, and Pluto.

From May 29 to August 15, 2010, Uranus briefly moves into Mars-ruled Aries before settling into a seven year sojourn starting in March 2011. Aries energy is bold and aggressive, ever ready to be the first to start something new. Cyber attack awakens from its dormant slumber behind the scenes (Uranus in Pisces) to an in your face sudden and swift attack (Uranus in Aries). Since Aries rules the military, cyberspace, satellites and outer space will become the new battlefield and competitive arena.

In late July 2010, Mars, Jupiter (foreign sources), Saturn, Uranus, and Pluto form a challenging alignment to one another in cardinal (action-oriented) signs primarily in the fire and air elements reflecting the use of new strategies used in cyberwarfare. Venus in Virgo challenging the USA’s natal Mars/Neptune alignment, Neptune (credit cards/viruses) conjoining the USA Moon (the public), and the other planets challenging the USA Venus, could represent a cyber or satellite attack that particularly affects all types of financial transactions.

The Vernal Equinox on March 20, 2011 finds the Sun in Aries conjoining Uranus (electrical grid), and Mars conjoins Uranus at the April 3, 2011 Aries New Moon. The New Moon opposes Saturn and challenges the USA’s Sun in Cancer and Saturn in Libra. (The USA’s last Saturn return was in 1981.) Mercury is retrograde. While these energies still indicate financial challenges, they relate more to geopolitical tensions and actions affecting military communications/warfare, the White House, and Congress.

Why spend billions of dollars fighting terrorists on the other side of the world when your enemies can easily and inexpensively attack your home turf just with the click of a mouse?

*When planets from Earth’s vantage point appear to be stationary or change direction, their energies are more pronounced.

Final Note:
Just as FINRA self regulates the U.S. securities industry, NERC (North American Reliability Corporation) oversees the bulk power grid. NERC was established on June 1, 1968 by the electric utility industry in response to the November 9, 1965 blackout. Interestingly, NERC was founded when Uranus was stationary direct. NERC has issued standards to protect “critical cyber assets” and is scheduled to begin compliance audits in July, when Saturn in Virgo will challenge its founding Mars and Pluto opposes its Mercury. Transiting Saturn and Uranus to NERC’s Pluto/Uranus in August/September will likely find NERC overwhelmed by government pressure to do more to encourage their members to be more diligent in cyber defense, particularly with the nuclear power plants.

JPMorgan Taking Former WaMu Branches Back To Basics

In this cost cutting environment, some analysts are criticizing JPMorgan (JPM) for spending money to transform Washington Mutual branches into Chase branches after acquiring most of WaMu from the FDIC for $1.9 billion last September.

The Wall Street Journal reports that JPMorgan will remodel about 900 WaMu branches between now and October. Branches will remain open during the two week renovation. WaMu began designing branches with the “Occasio” style layout in 2004. Occasio means “favorable opportunity” in Latin, but one look at the interactive graphic explains why JPMorgan wants to transform the branches back to a traditional layout. At the Occasio style branches, a customer is greeted by the Concierge who directs the customer to the tellers stationed in a circle in the center of the branch. To get cash, the teller hands the customer a slip with a numerical code to enter into the cash dispenser.

Critics of the branch remodeling are being penny wise and pound foolish. WaMu was a fallen brand, and the Chase branches should not be holding onto the energies of its tarnished aura. Remodeling allows JPMorgan to reconfigure the energies.

Banks are ruled by Venus and Pluto. As the ruler of money and all moveable assets, Venus and the sign Taurus rule banks. Venus is the energy of attraction and beauty, and banks used to pay more attention to surrounding branch exteriors with attractive flowers and shrubbery. As the opposite sign of Taurus, Scorpio and its planetary ruler Pluto represent lending.

WaMu’s design and style epitomized the Pluto in Sagittarius era (1995-2008). Sagittarius’ style is extremely casual, from the branch design to the tellers. And as we’re all too well aware, this way too laid back manner translated into sloppy lending practices.

Charles Scharf who runs JPMorgan’s Chase unit, told the Journal that “traditional branches are superior in every way. They might be boring, but they’re practical.” Whether JPMorgan realizes it or not, the return to traditional bank branches and more importantly, traditional banking, is what the era of Pluto in Capricorn (2008-2024) is all about.

No disclosures.

Wall Street Weather Forecast For Week Of April 6, 2009

Summary Of Last Week’s Influences:
Since ancient times the theme of sacrifice, death, and rebirth has been celebrated at this time of year. Events in financial markets and global politics last week certainly reflected this theme made more intense by the planetary energies of Venus in Aries retrograde challenging a stationary retrograde Pluto in Capricorn.

The Vernal Equinox on March 20 marked the moment when Spring began in the northern hemisphere as the Sun entered Aries, the first sign of the zodiac. The first New Moon following the Vernal Equinox is a powerful time of the year to spring into action by taking a pioneering and bold approach.

On the March 26 Aries New Moon, President Obama and the members of his Auto Task Force, began to take action in response to the auto restructuring plans Chrysler and General Motors (GM) submitted on February 17, 2009. I had written last year that Rick Wagoner’s chart looked challenging especially during the first quarter of 2009. It was reported that the decision to fire Wagoner was the first decision to be made as a symbol of change. For Wagoner, “sacrifice” is leaving GM with around $21 million.

Venus represents banking/finance and agreements/partnerships. Pluto represents debt, and in Capricorn, debt that has accumulated over time and costs associated with older workers. Pluto is the cycle of decay, death and rebirth. What is not working anymore is in a cycle of decay and must die in order to transform and be reborn into something viable.

President Obama is giving Chrysler 30 days to partner with Fiat (FIATY), and GM 60 days to substantially restructure its debt and liabilities with its bondholders and the UAW. If the automakers fail to meet these and other requirements of the Administration, they will go into Pluto-ruled bankruptcy. This was the conclusion of my three part post (Part I, Part II, Part III) last year on the automakers. With Pluto opposing the USA’s natal Venus and Jupiter in Cancer over the next couple years, bankruptcies are likely to reach record levels.

Chrysler will end up filing Chapter 7, its plants and components used for other endeavors. Neptune dissolves current conditions, and as this planetary energy is pronounced in late May, GM will go through Chapter 11 to shed the debts and obligations it is unable to do outside of bankruptcy. Fritz Henderson, a 25 year GM veteran was appointed by the Administration to replace Wagoner. Based on the transits to his chart, I think it is unlikely Henderson will be running GM for very long.

Despite the fact that Paulson, Bernanke, and Geithner called the market’s bluff on Lehman Brothers, the market thinks President Obama would not force these companies into bankruptcy as it would hurt union workers. The US automakers have been crushed by a combination of their own incompetence and out of control healthcare costs. The Administration will let these workers lose their healthcare benefits in order to provide the nation with healthcare for all.

After Monday’s sharp market decline for fear the Administration will start sacking bank execs, the indices continued back on their upward trend that began when Venus went retrograde March 6. By Thursday, financial markets around the globe were thrilled when British PM Gordon Brown declared that the G20 meeting marked the emergence of a “new world order.” Translation: the most powerful plutocrats are in government (Capricorn), not private industry.

And now we get to the parts where financial arrangements (Venus) are not what they appear to be on the surface. When Pluto energies are pronounced, some secrets get spilled and others get covered up. Of the $1.1 trillion pledged at the G20 summit, half of it comprised of future promises, and the other half for the IMF to boost every member country’s forex reserves. The G20 has agreed to ask the IMF to sell 403 tons of gold to finance assistance to the poor; additional sales may be considered.

Speaking of metals, Venus rules copper which is doing better than gold at the moment. Copper prices in Shanghai are trading higher than on the LME based on current demand in China. Rising prices are also based on the belief that the stimulus spending could start to spur demand here. Perhaps demand for copper could start with rewiring homes damaged by Chinese drywall.

Planets appearing to be in retrograde motion can indicate reversals of decisions. Capricorn is ruled by Saturn and with Saturn in Virgo (accounting rules and regulations) retrograde until May 16, FASB bowed to political pressure and reversed its “mark to market” accounting rule for Level III assets. Now banks can value (Venus) all those illiquid toxic (Pluto) assets by their own in-house models vs. current market prices.

This is yet another example of how the Bush and the Obama Administrations never fully think through how one action affects another. If banks no longer have to mark these toxic assets at current values, what’s their motivation for selling them into Geithner’s public-private plan? And more importantly, why have the government overpay for this junk when super TARPed Bank of America (BAC) and Citigroup (C) are using the $45 billion combined government bailout to scoop up other MBS in the secondary market. (Even The New York Post recognizes that Pluto rules all things toxic!)

As much as the government protested AIG’s bonuses and are getting more agitated over Fannie (FNM) and Freddie’s (FRE), Congress loves to give out bonuses to their staff rather than return to the “taxpayers” any funds left over at the end of the year from their office budget. House Financial Services Committee Chairman Barney Frank gave bonuses to committee staffers for all the long hours they slogged on the TARP legislation last fall.


And then there’s NEC Director Larry Summers who was paid $45,000 to give a speech on November 12 to Merrill Lynch, one month after the firm had been TARPed and when he knew he would be taking a position in the Administration. Summers, who earned $2.7 million giving speeches to mostly now TARPed banks, should have given the money to the “taxpayers” rather than charity. With Jupiter and Neptune getting ready to converge on his natal Mars and Pluto, it will be interesting to see if this and more could manage to get him booted out of the White House.

Summary Of This Week’s Influences:
This is an abbreviated week, as markets will be closed for Good Friday. Doubt and increasing volatility looks to be slowly seeping into the bullish outlook.

Monday, April 6, 2009
Negative trend bias early; could see improvement near midday to choppy/mixed to moderately positive conditions.

Tuesday, April 7, 2009
Volatile; negative trend bias. Strongest in afternoon, and could even briefly swing in the opposite direction. Markets could be worried about rising interest rates.

Wednesday, April 8, 2009
Yesterday’s sentiment could carry over early; improves and likely turns positive later in session.

Thursday, April 9, 2009
Positive, especially in the morning to early afternoon. The bond market closes at 2:00 PM.

Frederick “Fritz” Henderson: November 29, 1958 time unknown Detroit, Michigan

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