WallStreetWeather.net Forecast For Week Of August 31, 2009

Summary Of Last Week’s Influences:
While events last week didn’t start to shake up the bulls’ confidence as much as I thought, the major indices did show signs that this rally is growing a bit weary. Although the indices closed at their 2009 highs Thursday and the DJIA and the S&P500 reached intraday 2009 highs on Friday, they failed to maintain it. Last Monday’s Moon in indecisive Libra kicked off a week of mostly choppy trading.

Planetary influences aside, when I hear pundits saying that the market is going to keep on going without turning back, it reminds of all that Dow 36,000 nonsense in the previous bubble. Last week the Investors Intelligence Advisors Sentiment Index reported bearish sentiment fell to 19.8% for the first time since October 2007 when the Dow and S&P reached record highs. Average S&P short interest in mid August is the lowest in eight months and overall market volume has been very low.

Returning to planetary influences, the peak of new daily highs on the NYSE peaked on August 3. Much of the excitement has been predicated on the growth play in China, yet the Shanghai Composite peaked on August 4. Both of these indicators topped out just before the August 5 Lunar Eclipse. As I wrote in a previous post, eclipses are harbingers of change and their influence is not immediately felt in the market.

Thankfully Mars opposing Pluto last Wednesday did not create any big geopolitical events, at least that we’re aware of now. (With the Moon in Pluto-ruled secretive Scorpio, something that happened then might be revealed at a later date.) Pluto rules lending, and on Wednesday for the first time since May 1993, three month US$ Libor became cheaper to borrow than Japanese yen. Mercury challenging Mars and then both planets challenging Pluto reflected a “change in direction in currencies and interest rates.”

“News about the Fed and its Chairman” also occurred as President Obama nominated Ben Bernanke to a second term. The Fed fired back on Wednesday against a Judge’s ruling to turn over documents to Bloomberg relating to the Fed’s bailouts last year under the Freedom of Information Act. Now the Judge has granted the Fed a stay in releasing the documents, giving the Fed until September 30 to file an appeal against the Judge’s decision. House Financial Services Committee Chairman Barney Frank said “I want to restrict the powers of the Federal Reserve in a number of ways.” Transits of Saturn, Uranus and Pluto between this autumn and 2010 are likely to limit (Saturn) the Fed’s powers, bring overdue reforms and openness (Uranus), and transform (Pluto) its purpose. And Chairman Frank has said “the House will probably approve legislation in October” that will allow the GAO to audit the Fed.

Mars is action and Pluto is secret dealings and private funds. On Wednesday the FDIC voted to allow private equity firms to buy into failed banks as a consortium providing they hold the purchase for at least three years and maintain Tier 1 common equity equivalent to at least 10% of the bank’s overall assets. However, each individual private equity firm cannot own more than 24.9% of a bank without being deemed a bank holding company and having to act as a source of strength for that bank.

Goldman Sachs (GS) on Wednesday was subpoenaed for information about its weekly “trading huddles” by Massachusetts’s chief financial regulator after a Monday front page Wall Street Journal article described how research staff only gave short term stock tips to traders and the firm’s best clients which at times contradicted with Goldman’s long term recommendations provided to all clients. The SEC and FINRA are going to ask Goldman for more information on its huddles. With Mercury in Venus-ruled Libra and Venus in Leo (stock market) until September 17, there will be a lot more news (Mercury) about questionable trading arrangements and practices, especially September 7 to 17 while Mercury is retrograde in Libra.

Summary Of This Week’s Influences:
This week will likely mark the end of the summer rally as Mercury and Pluto from Earth’s vantage point will appear to change direction next week. Planets reversing direction tend to correlate to at least temporary market reversals.

Choppy/mixed conditions are likely to prevail this week with an increase in volatility to the downside. The Moon (sentiment) will be traveling through Saturn-ruled Capricorn Monday and Uranus-ruled Aquarius Tuesday until midday Thursday, emotionally expressing the Saturn/Uranus opposition of September 15.

As I wrote in a previous post, September 15 will be the third opposition of Saturn and Uranus. Saturn represents the caution and growing concern that fundamentals have fallen too far behind the stock market’s rocket ride fueled by future projections (Uranus).

Saturn in Virgo represents all the efficiencies companies have squeezed out to still make a profit or at least to keep the red ink from spreading. A major part of this cost containment has been to reduce (Saturn) the workforce (Virgo) and increase the productivity of the remaining workers.

Workers will be at the forefront of the market’s mind this week when the August employment report is released Friday morning. With the Full Moon in Pisces occurring Friday at 12:03 PM, the market could have an overblown reaction to the number. Although I think the reaction will be to the downside, the market has a tendency to peak out at or prior to the Full Moon before turning negative.

Virgo represents healthcare in general and Pisces rules drugs and hospitals, so the Full Moon will accentuate the highly charged emotions that have been stirred up over healthcare reform. Friday marks the first deadline for health insurers to submit data to the House Energy & Commerce Committee on health insurance company employees compensated $500,000+, along with details of corporate retreats.

Monday, August 31, 2009
Market becomes more cautious about taking another leg higher. Negative trend bias, but could see improving conditions in afternoon.

Tuesday, September 1, 2009
Negative early; improving conditions as morning progresses. Reverses in afternoon, but could show improvement toward the close.

Wednesday, September 2, 2009
Moderately positive in the morning, then becomes choppy/mixed before turning negative in afternoon.

Thursday, September 3, 2009
Choppy/mixed to positive trend bias weakens and turns negative in afternoon.

Friday, September 4, 2009
Downturn accelerates as the day progresses.

No disclosure.

President Obama Nominates Bernanke To Second Term As Fed Chairman

Published by WallStreetWeather.net

President Obama nominated Federal Reserve Chairman Ben Bernanke to a second term this morning. Speaking during his vacation on Martha’s Vineyard, the President displayed no emotion when he said Bernanke’s “bold action and outside-the-box thinking helped put the brakes on our economic freefall.” Bernanke looked just as enthusiastic, stating he is committed to work with the Fed, Congress and the Administration to “help provide a solid foundation for growth and prosperity in an environment of price stability.”

Although Bernanke could face opposition during his Senate confirmation hearing, my September 2007 prediction that Bernanke would not serve a second term as Fed Chairman will likely be proven wrong.

The New York Times reports President Obama “had decided four or five weeks ago” to re-appoint Bernanke. This corresponds to the time of the July 21 Solar Eclipse in Cancer that conjoined the Federal Reserve’s Neptune and opposed Pluto in the sector of the USA chart representing the economy and the financial system. Wall Street and most economists have been urging President Obama to re-appoint Bernanke as soon as possible as the Fed’s monetary policies fueled hopes (Neptune) the economy had been resurrected from the brink of death (Pluto).

Cancer and its ruler the Moon represent the public, and although the Fed’s policies are not directly helping most consumers, a rapidly rising stock market helps ease some of their losses and increases the public’s confidence that economic conditions are improving. The Fed’s policy of keeping interest rates low “for an extended period,” keeps the deficit lower to help the President pass healthcare reform and the other key items on the administration’s agenda.

Last week as Saturn in Virgo challenged Bernanke’s Sun in Sagittarius and Jupiter in Gemini, President Obama invited the Fed Chairman to the White House to discuss his reappointment. Saturn transiting a person’s natal Sun brings heavy responsibilities and increased demands in order to attain or stay on top in a career. Bernanke’s efforts to promote economic expansion have lived up to expectations (Jupiter). Jupiter in Aquarius making a favorable alignment to Bernanke’s Sun and Jupiter marks a time of career recognition and the opportunity to serve another term at the helm of the Federal Reserve. Jupiter’s energy helps to offset the rumblings of his critics who hold Bernanke accountable (Saturn in Virgo) for his role in enabling the worst financial crisis since the Great Depression and then bailing out Wall Street at the taxpayer’s expense.

Jupiter expands and Saturn contracts. Jupiter transiting Bernanke’s natal Sun and Jupiter describe the Administration’s financial regulatory reform proposal that would expand the Fed’s powers to become the Systemic Risk Regulator in charge of all institutions that could pose a systemic risk to the financial system, giving the Fed the power to unwind these firms in a financial crisis. Saturn contracts by removing a few of the Fed’s current powers, most notably removing its ability to regulate consumer products. I wrote in September 2007 that Bernanke would “disagree with the new duties and structure of the Fed,” and Bernanke has made it clear he sides with Wall Street and opposes taking away the Fed’s ability to regulate consumer financial products. Now that he’s been re-appointed, it will be interesting to see if he maintains his opposition against the Administration’s plan.

I wrote that Mercury (news), Mars (action), and Pluto (secrets) forming a challenging alignment August 25-26 to the Fed’s Sun and Pluto “could bring news about or coming from the Federal Reserve and its Chairman.” While the stock market was by no means “spooked” about the news of Bernanke’s re-appointment today, a federal judge ruled the Fed “improperly withheld agency records”, and the Fed has five days to turn over documents disclosing the names of companies and the terms of the loans the Fed has issued under its 11 programs established during the financial crisis. The judge’s action is the result of a lawsuit filed last November by Bloomberg after the Fed refused to provide the information requested under the Freedom of Information Act.

So why did President Obama nominate Bernanke while he was on vacation? Perhaps it was to deflect his criticism that he was taking a vacation. Venus ruling the chart for the time President Obama nominated Bernanke forming a stressful alignment to Pluto (debt) in Capricorn (economic contraction) shows the nomination’s timing was to help deflect news reports of the CBO’s release of its annual summer update of the budget and economic outlook. The CBO raised its estimate of the federal deficit from $7.1 trillion to $9 trillion over the next ten years, and also estimated the economy will contract 2.8% this year. Both estimates came in higher than the Administration had projected earlier this year.

Venus, Mercury, and Mars about to move into new signs confirm the decision to re-appoint Bernanke was decided a while ago. Venus conjoining the degree of the July 21 Solar Eclipse and the Federal Reserve’s Neptune today reinforces the decision was made around that time. It was on July 21 that Bernanke wrote an op-ed piece in The Wall Street Journal outlining the Fed’s “exit strategy.” Neptune rules inflation, and Bernanke’s reluctance to employ an exit strategy is what probably caused President Obama to reluctantly re-appoint him. Bernanke’s progressed* Sun and Venus conjoining President Obama’s Aquarius Ascendant,** reflects that Bernanke was re-appointed to enhance the President’s public image and poll numbers and not to reward Bernanke.

The Moon in Pluto-ruled Scorpio (debt) in the sector of the chart representing the economy reflects the public’s concern about the Administration’s spending. An aspect between the Moon and Uranus which rules the sector of the chart representing the stock market, shows that Jupiter and Neptune in this sector can stem the public’s objections to the Administration’s agenda by creating an atmosphere of optimism and growth (Jupiter) that fosters the illusion (Neptune) the economy and the stock market are on the rebound.

The Ascendant of the chart for Bernanke’s nomination this morning conjoins the degree that Mercury will turn retrograde*** on September 7 which in turn conjoins the September 29, 2008 Libra New Moon. All of the events that led to the creation of the TARP, the Fed’s lending programs and undisclosed contractual agreements with banks and their counterparties will come under review.

The financial crisis has already radically revamped the Fed’s purpose and scope. Financial regulatory reform will certainly transform the duties and structure of the Federal Reserve and its Chairman.

*A mathematical calculation that moves the planets forward in time as a method of prediction.

**The Ascendant represents the zodiac sign rising on the eastern horizon at the time of the announcement.

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

Obama Appoints Bernanke: August 25, 2009 8:55 AM EDT Martha’s Vineyard, MA
Ben Bernanke: December 13, 1953 time unknown Augusta, GA
Federal Reserve: December 23, 1913 6:02 PM EST Washington, DC
USA: July 4, 1776 5:10 PM Philadelphia, PA
President Obama: August 4, 1961 7:24 PM AHST Honolulu, HI

WallStreetWeather.net Forecast For Week Of August 24, 2009

Summary Of Last Week’s Influences:
Mercury describes what investors are thinking and how they react to news. Mercury conjoining Saturn in Virgo Monday sparked a global selloff on fears of economic contraction. The Shanghai Composite dropped 5.8%, its biggest one day decline since November 18 on concerns the stock market had formed a bubble fueled by bank lending. This was reflected by the opposition between the Sun in Leo (stock market) opposing Neptune in Aquarius (bubbles). U.S. indices fell less severely, but Monday’s Moon in Cancer reflected investors concerned about consumers keeping a tight rein on spending. Cancer and the Moon rule the home. Lowe’s (LOW) reported reduced profits and announced the company will curtail its 2010 expansion plans as consumers refrain from spending on large scale remodeling projects.

Mercury is a dualistic energy, and Mercury opposite Uranus in Pisces Friday reflected two news events occurring simultaneously that helped propel the stock market’s rocket ride to close at a 2009 high, returning the indices to their late October/November 2008 levels.

July existing home sales increased 7.2%, the fourth consecutive monthly increase. The gain marked the first multi-month increase in five years. Investors chose to ignore the rest of the report showing house prices continued to decline with the median home price down 15% year/year to $178,400. 31% of July home sales were for foreclosed properties.

Wall St. was also thrilled after Federal Reserve Chairman Bernanke said in a speech at the Fed’s annual gathering in Jackson Hole that “the prospects for a return to growth in the near term appear good.” But other central bankers attending such as ECB president Jean-Claude Trichet, were “a little bit uneasy” about Bernanke’s optimism and confidence that an “extraordinarily deep and protracted” global recession had been prevented by the “speedy and forceful actions” by the Fed and other central banks.

According to The Wall Street Journal’s “Heard on the Street” column, Bernanke joked about his “forecasting abilities” at the confab’s kickoff dinner Thursday night. When told the astronomy club would be hosting a night of stargazing for attendees, Bernanke asked Kansas City Fed president Thomas Hoenig: “Do you know if they do astrology? It couldn’t hurt.” That’s an understatement! Understanding planetary cycles could have prevented a housing bubble, a credit crisis, and saved billions in taxpayer funded bailouts that could have went to more productive uses such as clean energy, infrastructure and healthcare reform. Astronomers are probably not amused, wondering how the Fed Chairman could be so insensitive even in jest to equate astronomy with astrology! ;-)

Mercury’s alignments to Saturn and Uranus activate the push/pull dynamic of caution/fear and economic contraction (Saturn) vs. getting invested in the market ahead of the economic rebound (Uranus). While Saturn represents fundamentals and tends to be a bearish influence, Uranus represents extremes in either direction, depending on how the market views the future at any given time. Rapid acceleration in one direction can just as quickly turn and go in the opposite extreme.

Summary Of This Week’s Influences:
(See my post on “Stock Market Turbulence During The Leo New Moon Cycle: August 20-September 18, 2009” for more info.)

Whether it’s the stock market, home sales, or motor vehicles, all have been boosted by government subsidies and/or special lending programs by the Fed, Treasury, and FDIC. So the question is can the stock market and the economy continue to grow without government assistance? Apparently the government and Wall St. believe it cannot.

The “Cash For Clunkers” program officially ends Monday at 8 PM, the last full day Mars will be in Mercury-ruled Gemini (motor vehicles). Venus (money) and Mars (action) together in Gemini from July 11 to 31 represented the peak of the popularity of the program and Congress allocating an additional $2 billion. Now auto manufacturers are increasing production just in time for Mercury retrograde (September 7-29) which is not a good time to buy a car unless you absolutely have to.

Mars will move into Cancer Tuesday afternoon until October 16. Cancer rules household appliances, and now the government is preparing a cash for clunkers type rebate program to get consumers to buy household appliances, furnaces and air conditioners for their homes that are Energy Star rated. (Consumers can keep their clunker appliances.) Federal money will be distributed to the states to decide how they will implement the program.

The $8,000 credit to first time home buyers expires November 30, but a bipartisan bill sponsored by Sens. Dodd & Isakson proposes to increase the credit to $15,000 and extend the credit to all homebuyers.

Funny how no one seems to have a problem with all these government subsidies and government ownership of certain businesses yet when it comes to healthcare reform, opponents are even against the government imposing consumer regulations prohibiting health insurance companies from rejecting people altogether as well as rejecting claims and rescinding policies of those who do have health insurance.

Events this week could begin to shakeup the bulls’ confidence that nothing can get in the way of the market continuing on its upward trajectory.

Monday, August 24, 2009
Negative.

Tuesday, August 25, 2009
Negative.

Wednesday, August 26, 2009
Negative; volatility increases.

Thursday, August 27, 2009
Choppy/mixed to positive trend bias.

Friday, August 28, 2009
Positive.

No disclosure.

Stock Market Turbulence During The Leo New Moon Cycle: August 20-September 18, 2009

Published by WallStreetWeather.net

The word month is derived from the Moon. The new month actually begins when the Sun (self-identity) and Moon (emotional instincts) conjoin at New Moon, beginning a new 28.5 day cycle.

The Leo New Moon occurs on August 20 at 6:02 AM EDT. Leo and the Sun rule all types of speculation. The lion must have the confidence and courage their bet will pay off. The Leo New Moon is a good time to assess if your speculations are a crap shot or an orchestration of carefully calibrated strategies flexible enough to adapt to changing market conditions. Do you view your speculations objectively and are willing to swallow your pride and take a loss if a position goes against you? Do you know when to take a profit or does your ego get greedy and demand you hang on for more? The most creative ideas/solutions could occur engaging in leisure pursuits, especially when Venus is in Leo (August 26 to September 20). Leo rules the heart and matters of the heart.

This New Moon occurs in the final days of the Sun’s sojourn in Leo. With the Sun having passed opposition to Jupiter (August 14) and Neptune (August 17), the Leo New Moon reflects the Sun beginning to set on the current bear market rally. The Moon becoming Void-of-Course* immediately after the Leo New Moon indicates we should be prepared for our creative pursuits to go in unexpected directions.

Over the next few weeks, financial markets will become turbulent as the veil of illusion is lifted and reality sets in to find that some of those recent outsized profits generated on Wall Street were exaggerated hype. The stock market will still have strong up days during this cycle, but the down days tend to be more powerful and plentiful. Leo/Sun represents leaders, and at least two prominent executives could get caught in a major scandal or web of deception.

Mercury (communication/movement) conjoining Saturn in Virgo in the sector representing the economy and the banking system in the New Moon chart for the USA describes economic contraction and worries about valuations. Mercury opposing Uranus in Pisces (August 21) can create wild market gyrations on unexpected news developments that could be related to credit quality or availability.

The cardinal signs** are the initiators. Planets entering cardinal signs bring new global issues, along with new developments regarding established issues. August 25-26 is very volatile as Mars (action/aggression) enters Moon-ruled Cancer until October 16 and Mercury enters Libra until September 17.

Mercury and Mars immediately square off with each other before they both form a stressful alignment to Pluto in Capricorn. Financial and diplomatic agreements could break down and power struggles ensue. Turf battles could erupt into an international incident that affects global markets. Mars opposing Pluto could represent an attack on a nuclear facility or a rogue group/nation making nuclear threats. Changes in direction in currencies and interest rates driven by market participants could occur now. The market could be spooked by news about or coming from the Federal Reserve and its Chairman as the Mercury/Mars/Pluto alignment impacts the Fed’s Sun/Pluto opposition.

The Moon in Pluto-ruled Scorpio from mid afternoon August 24 until late on the 26th tends to create highly intense emotions that could erupt into violent power struggles and the desire for revenge. Be calm and avoid confrontational situations and traveling to unfamiliar areas. Powerful storms could create flooding, damaging homes and buildings.

Look for some of the secret financial web connecting corporate interests, Wall Street, health insurers and the medical industrial complex, and members of Congress to get exposed. When members of Congress return from recess, financial and healthcare reforms will take center stage. The opposition’s protests against healthcare reform have only strengthened the majority’s resolve to pass healthcare legislation. Congress is also going to get aggressive about trying to pass financial regulatory reform.

Hot Spots:
East Coast (Maine to North Carolina), Alaska, Pacific Northwest to San Francisco. Russia, Belarus, Ukraine, Turkey, Egypt, Sudan, Iran, U.A.E., Oman, Pakistan (Islamabad), Koreas, Philippines, Indonesia, eastern Australia, Papua New Guinea.

First Quarter Moon
The First Quarter Moon on August 27 at 7:42 AM EDT marks the midpoint between the New and Full Moon. As the Sun and Mercury travel in Virgo, it’s time to fine tune all the details relating to what was begun at the New Moon. Try to complete your most important tasks and activities before Mercury turns retrograde*** on September 7. The Moon in Sagittarius and a favorable aspect between Mercury and Venus (August 27/28) is a good time to seal the deal.

In the USA, the public’s outlook is cautious and critical that the Administration and Congress has not done enough to help consumers cope with the fallout from the financial crisis, a factor that will make Wall St. jittery.

Hot Spots:
New England states, Louisiana, Mississippi, Alaska, Hawaii. Eastern Caribbean, Puerto Rico, Dominican Republic, Mexico, Venezuela, Guyana, Brazil. Estonia, Latvia, Lithuania, Belarus, Ukraine. Egypt, Sudan, Saudi Arabia, Iraq, Iran, eastern China, Taiwan, Philippines, Indonesia, western Australia.

Full Moon
The Full Moon on September 4 at 12:03 PM EDT marks the halfway point of the lunar cycle. If you want to announce or promote something to receive maximum attention, this is the time to do it! Emotions run high like the tides, especially with the Full Moon in sensitive Pisces. This Full Moon is about balancing our self serving needs (Sun in Virgo) with what’s best for the greater good of the collective (Moon in Pisces).

Virgo rules healthcare as well as accountability and efficiencies, and the Full Moon will bust some of the lies and deceptions (Pisces) put forth by the opposition. Today marks the deadline that 52 of the nation’s largest health insurance companies with over $2 billion in revenues must submit responses to questions requested in a letter by the House Energy & Commerce Committee . The insurance companies must submit a table of each employee or officer with total compensation of $500,000 or more between 2003-08, expenses for outside retreats from 2007+, and premiums, claims, and expenses for the group, individual, and government segments. By September 14 we’ll learn exactly how much the private health insurers are profiting from their government business.

Virgo rules the workforce, and the stock market could go into a panic attack that the August unemployment report is worse than expected. Turmoil in the banking, insurance, and real estate sectors could cause panic in the stock market. Mercury turning retrograde over Labor Day weekend could alter holiday plans, and accentuates the choppiness and market volatility. Mercury retrograde on last year’s Libra New Moon reviews TARP and the craziness of the financial crisis, and serves as a reminder that the financial system got stabilized yet nothing has been solved.

Pisces and Neptune rule the oceans. Sudden thunderstorms dumping lots of precipitation are likely. If a tropical storm/hurricane forms during this time, its path could travel through the eastern Caribbean islands, Jamaica, Cuba, Bahamas, Key West, Florida (Gulf Coast between Naples and Sarasota), Georgia and Carolinas.

Additional Hot Spots:
Alaska. Brazil. Ukraine, Russia, Georgia, Armenia. Egypt, Sudan, Ethiopia, Somalia, Madagascar. Iraq, Saudi Arabia, South Yemen, Iran. Northeastern China, Koreas, Japan. Papua New Guinea, Australia.

Last Quarter Moon
The Last Quarter Moon in Gemini on September 11 at 10:16 PM is the time to finish up what was begun at the New Moon. If the nation feels particularly intense on the eighth anniversary of the 9/11 attacks, it is because Pluto the planetary energy relating to life, death, and transformation, great power and wealth, debt, taxes, insurance, bankruptcy, conspiracies/secrets, and nuclear energy, turns direct today after being retrograde since April 4. These themes will be in the forefront now. With Mercury retrograde and the Moon in Mercury-ruled Gemini (as it was on 9/11), information will be revealed during this period about many of these issues that cause people to rethink their positions and seek meaningful change rather than defending the status quo. Venus opposing Jupiter exaggerates market sentiment.

Hot Spots:
Earthquake potential for Idaho, Nevada, southern California (southern around Long Beach area). Russia, Turkmenistan, Uzbekistan, Kazakhstan. Iran, Afghanistan, Pakistan.

This last and final act of the Leo New Moon cycle could be the most dramatic as Saturn (status quo) opposes Uranus (reform)**** for the third time on the 15th, the one year anniversary of Lehman’s bankruptcy filing. Venus opposing Neptune could bring a stock market fraud/scandal.

The fever pitch about the events of last September/October reach peak on September 17. Mercury challenging Pluto can reveal market manipulation. The Moon is in Mercury-ruled Virgo and Mercury re-enters Virgo, while the Sun in Virgo re-activates Saturn/Uranus opposition.

All of these planetary alignments will demonstrate that there is a lot of work to be done before this recession is over. The financial system may have been stabilized, but the old (Saturn) must be taken apart and transformed (Pluto) before the future (Uranus) reflects the indices' current levels.

*When the Moon (our emotional barometer) does not form any relationships to a planet before entering a new zodiacal sign.

**The cardinal signs are Aries, Cancer, Libra, Capricorn.

***Planets do not really move backwards, but appear to from Earth’s vantage point. I will be writing an upcoming post about the September Mercury retrograde. In the meantime, here's a post about Mercury retrograde in 2009.

Related Posts: ****“Eclipses and Other Planetary Pair Ups Will Bring Back The Bear Market By Autumn” and “Wall Street and the Consumer in Parallel Universes”

The Weekly Forecast offers a more detailed view of planetary influences and their potential to affect the stock market.

WallStreetWeather.net Forecast For Week Of August 17, 2009

Summary Of Last Week’s Influences:
Even though the major indices ended the week only slightly lower than where they began, a tiny air hole is beginning to develop in the bull’s hot air balloon. July retail sales and the University of Michigan’s Survey of Consumer Sentiment came in lower than the market expected, reflecting that Wall Street and consumers are indeed living in parallel universes.

July CPI was unchanged and year over year was down 2.1%, the sharpest annual decline since January 1950 when Saturn was also transiting Virgo. Saturn in Virgo (2007-2010) reflects that consumers are limiting most of their spending to necessities. In last week’s Forecast I wrote that I thought inflation might have come in higher than expected, but because of the weird way inflation is calculated by the BLS, a 28.1% drop in energy prices year over year offset increases in the food index and Core CPI (ex food and energy). Never mind that last July’s $145 barrel oil was an outlier. The cost of new vehicles, medical care, apparel, and air fares increased in July. And the cost of the roof over your head (the shelter index) was lower because lodging away from home fell. (I’ll refrain from commenting on the “logic” of that.)

The Federal Reserve did take baby steps to “de-emphasize” its debt purchase programs, announcing that its purchase of Treasury securities will be completed by the end of October, while continuing to emphasize that the fed funds rate will be kept low “for an extended period.” As long term interest rates will be allowed to slowly rise, while short term interest rates are capped near zero, bank net interest margins will expand. This is Bernanke’s not so stealth method of pumping up the profitability of the banking system on the backs of consumers.

The Fed’s policies have not helped borrowers or savers, but Wall Street has certainly rebounded nicely. Monetary policy is the only case the bulls can make to keep the stock market on an upward trajectory. Bank analyst Richard Bove commented last week that the rally in bank stocks reflected psychology, not fundamentals.

In the Bank of America/Merrill Lynch bonus saga, Judge Rakoff expressed his “continued misgivings” at last Monday’s hearing, ordering BofA and the SEC to submit additional information on their $33 million civil settlement to him within two weeks.

Besides the rally being an opportunity to take profits on stocks bought last autumn through winter, thankfully bullish sentiment has kept CNBC from sending reporters to stand out in front of troubled banks like they did last year. Yet the FDIC has kept busy on Friday nights, and last Friday was particularly busy. Colonial Bank, with 346 branches in five states, became the biggest bank to fail since Washington Mutual last September. BB&T Corp. (BBT) has assumed all of Colonial’s deposits.

As the planetary energies become more volatile through the autumn, I’m not the only one who doesn’t automatically reject the possibility that the stock market could drop below the levels reached in early March.

Summary Of This Week’s Influences:
The Sun ends its sojourn in its “home” sign Leo this week. On Monday the upward inclination of the Sun aspecting Mars and opposing Neptune (while Mars harmonizes with Neptune) is met with cautious resistance by Mercury conjoining Saturn, as news events and/or analyst opinion could dampen the lion’s courage to be in full bull mode. Mercury conjoining Saturn emphasizes studying the fine print and taking all the details into account.

Mars in Gemini challenging Uranus in Pisces influences Tuesday/Wednesday, increasing volatility and fast and sharp market moves that can create an up or downside surprise. It’s important to focus on one thing at a time and use caution in driving. Electronic and mechanical breakdowns could occur now.

The chart for Thursday’s New Moon in Leo (6:02 AM EDT) shows large market moves between August 20 and September 18, tending to the downside over fears about economic contraction, the Administration’s financial regulatory reform, and action on healthcare reform in Congress.

Mercury opposing Uranus on Friday Options expiration could create some wild gyrations. There could be communication disruptions and problems with data feeds.

Bernanke will be speaking Friday at the Fed’s annual conference in Jackson Hole on “The Year of Crisis.” The Fed Chairman thinks he saved us from “Depression 2.0,” but in reality the consumer driven economy that he believes he’s recreating will never be as it was again.

Monday, August 17, 2009
Choppy/mixed conditions to the upside. (DJIA and S&P are likely to be stronger than NASDAQ.)

Tuesday, August 18, 2009
Positive trend bias especially early in session. Starts losing momentum and becoming more volatile as day progresses, probably ending choppy/mixed to moderately up.

Wednesday, August 19, 2009
Volatile; could see large moves in either or both directions, but bias is to the downside.

Thursday, August 20, 2009
Choppy/mixed to positive bias.

Friday, August 21, 2009
Volatile; news driven session could swing in either or both directions, but tendency is negative.

Whole Foods’ John Mackey Out To Alienate Core Customers

Published by WallStreetWeather.net
Most consumers and investors would not view Wal-Mart (WMT) as being a more compassionate company than Whole Foods Markets (WFMI) when it comes to healthcare reform, yet Wal-Mart is more attuned to the anxieties as well as the spiritual needs of its customers than Whole Foods. Yet “Holy” Foods slapped their customers in the face when CEO John Mackey wrote an op-ed piece in The Wall Street Journal (“The Whole Foods Alternative to ObamaCare”).

Mr. Mackey is not shy about expressing his opinions, but after facing an SEC investigation for posing on a Yahoo message board as “Rahodeb” while seeking to takeover Wild Oats, he has once again stepped over the line in neglecting to separate his personal opinions from the “core values” of the public company he co-founded.

Whole Foods has built their business around the aura of not being any old supermarket, but a place for better educated more health conscious consumers to shop. These target customers have been sold on the value of paying extra for organic, “fair trade,” and more environmentally friendly products. These customers are more likely than the average supermarket customer to be sympathetic toward those who have either been rejected by private health insurers or cannot afford private health insurance premiums. These target customers are more likely to be repulsed by Mackey’s call for a pure Darwinist health insurance system where only the “fittest” would survive medical underwriting.

While reading my analysis of the hypocrisy of Mackey’s proposals, please consider if or when the company can reconcile with its alienated customers. These core socialistic customers will surely put the Darwinist to the test. The hard fighting, extremely successful CEO may have picked one fight too many and might even be unprepared to defend his already proven unsuccessful Republican sound bites.

Now let’s dissect Mackey’s “eight reforms” that sound like copies of daily editorials from the pages of The Wall Street Journal and Investors Business Daily:

Since Mackey states that “equal access to doctors, medicines, and hospitals” is not “an intrinsic ethical right” since it is not found in the Declaration of Independence and the Constitution, why would Mackey proudly proclaim that he offers health insurance to his employees? (Oops, I forgot that Mackey refers to employees as “team members.” This is no different than comrades.) After all, a true “free market” libertarian would say an employer has no obligation whatsoever to their employees beyond pay for services rendered. And it’s not the nature of a Darwinist to show paternal instincts toward anyone other than their own offspring.

The real reason why Mackey provides health insurance to his team members is as a competitive advantage to keep them entrapped at Whole Foods. “ObamaCare” would create a free and open healthcare system that would allow team members the freedom and choices to obtain the insurance plan that best suits their personal needs rather than the healthcare choice made by Whole Foods. This is true “personal empowerment.”

Yet the combination of Whole Foods $1,800 annual HSA contribution and the plans $2,500 deductible only leaves employees with a potential $700 out of pocket expense without considering co-pays. Whole Foods also pays 100% of the premiums for the 89% of company team members who work 30+ hours per week. This tiny “doughnut hole” provides little incentive for Whole Foods employees to be cost conscious about medical expenditures. In fact, major private insurance companies have stated in their earnings calls that employer contributions toward the deductible of high deductible plans have actually discouraged any cost savings. Insurance companies have admitted that this disincentive of employees to reduce their medical expenses is causing them to raise premiums. To break the myth, high deductible plans only work when employees actually forgo medical treatment entirely.

Mackey’s point to “make costs transparent so consumers understand what healthcare treatments cost” will only work if employers stop subsidizing high-deductible HSA plans AND doctors and medical providers are freely transparent in disclosing prices.

I agree with Mackey the tax laws should be equalized so individuals receive the same tax benefit purchasing insurance as employers do, but Mackey does not want to equalize the law so individuals are guaranteed access to health insurance the same as employees are.

Mackey and his free market comrades believe people should be able to cross state lines to purchase policies offered in other states by out of state insurance companies. This already exists now through United Healthcare’s (UNH) Golden Rule Insurance Company and United’s plan for AARP members 50+. However, buying an out of state plan usually provides less consumer protections than purchasing a plan from a health insurance company licensed to sell policies in your state.

I agree with Mackey that we need tort reform which could eliminate a lot of the wasteful costs associated with doctors practicing defensive medical care for fear of malpractice suits. Yet for years Republicans have complained about the need for tort reform, yet did nothing even when they controlled Congress and the White House.

The same goes for Mackey complaining about the spiraling federal deficit. I don’t recall any op-ed pieces from Mackey about the costs of the wars in Iraq and Afghanistan that far exceed even the most anti-ObamaCare cost estimates, the tax cuts that were not “paid for,” the billions in bailouts for Wall Street and the auto industry, etc. that all began during the Bush Administration.

Mackey “wants to repeal government mandates regarding what insurance companies must cover.” I’m assuming Mackey means you shouldn’t have to purchase a policy with excessive benefits, but healthcare reform should create minimum federal standards to ensure consumers have catastrophic coverage.

Mackey wants to “enact Medicare reforms that create greater patient empowerment, choice and responsibility” but fails to describe what that would entail. Mackey, the Republicans, and some Democrats talk about the need to lower the cost of Medicare, yet these are the hypocrites who are getting the seniors to oppose healthcare reform by telling them in TV commercials that they won’t be able to get as many MRIs and CT scans as they want and that if more people get healthcare seniors will have to wait longer to get a doctor’s appointment. Essentially, the opposition is screaming to reduce costs but fights every attempt to do so.

And what’s John Mackey’s solution “to help the millions of people who have no insurance and aren’t covered by Medicare, Medicaid or the State Children’s Health Insurance Program”? Mackey wants to “revise tax forms to make it easier for individuals to make a voluntary, tax-deductible donation” so these people can purchase insurance. Most people want to be self-sufficient and would prefer reforms that make healthcare regulations a level playing field than accept charity. Besides, Mackey conveniently forgets the millions of people who cannot obtain a policy at any price due to the discrimination of medical underwriting.

Mackey believes that “70% of all healthcare spending is mostly preventable if individuals take responsibility for their health through proper diet, exercise, and other healthy lifestyle choices.” While I wholeheartedly agree with him, there are many other ailments and medical situations that can arise in spite of living a healthy lifestyle. Do you deny care to the baby born with Down syndrome, the teenager with cancer, or a person with motor neurone disease such as scientist Stephen Hawking, who despite Mackey’s assertions about healthcare in England said he “wouldn't be here today if it were not for the NHS.” If healthcare in Canada and England was a bleak as Mackey and his free market friends describe, the dead bodies should be littering the streets there.

As Mackey himself admitted on last week’s earnings call, the majority of items that Whole Foods sells are “a bunch of junk.” Which means that John Mackey’s company is contributing to that 70% of healthcare spending he states is “mostly preventable.”

Disclosure: I made a nice profit selling my WFMI shares August 5. The profit will more than cover the extra gas and extra cost to purchase the items at other stores I used to buy each week at Whole Foods.

Related Posts: “The Healthcare ‘Haves’ Don’t Realize Their Risks” and “Healthcare Reform: President Obama vs. Blue Dogs, Elephants, Six Hypocritical Senators, United Healthcare, and a Fraudulent Former Hospital CEO”.

WallStreetWeather.net Forecast For Week Of August 10, 2009

Summary Of Last Week’s Influences:
A favorable alignment between Mercury in Virgo and Venus in Cancer Friday brought pleasant financial (Venus) news (Mercury) that fewer workers (Virgo) lost their jobs than expected in July. Hours worked and average hourly earnings increased slightly. The DJIA and the S&P500 closed Friday at new highs for the year, but the NASDAQ failed to top the high it made earlier in the week.

While Friday’s employment report was certainly a favorable development, looking at the “numbers behind the numbers” warrants a more cautious interpretation. The Unemployment Rate dropped from 9.5% to 9.4% as the separate household survey showed that the number of people who gave up looking for work (422,000) exceeded the number of jobs lost (247,000). 1 in 3 workers (5 million) were unemployed for 27 weeks or more.

Summary Of This Week’s Influences:
Volatility and larger price movements are likely to heat up this week as fast-acting Mars interacts with Saturn in Virgo on Monday and Jupiter in Aquarius on Thursday.

Mars in Gemini tends to react quickly to information, as it represents acting on multiple issues. With the Moon (sentiment) in Mars-ruled Aries Monday, the desire to act quickly will be challenged by cautious Saturn that tends to put the brakes on moving forward. In the stock market this energy is likely to hit a roadblock.

As Mars and Saturn are in signs ruled by Mercury, communication and travel delays are possible. The internet and other data feeds could run slower or access could be temporarily blocked. Disagreements over contractual agreements could arise.

Mars challenging Saturn can bring frustrations dealing with superiors and governmental authorities. On Monday Bank of America (BAC) and the SEC will have to explain to U.S. District Judge Jed S. Rakoff at a court hearing how BofA without admitting or denying any wrongdoing, agreed on August 3 to pay the SEC a $33 million fine to settle a civil lawsuit for failing to disclose in the BofA/Merill Lynch merger proxy filing that BofA had agreed that Merrill could pay up to $5.8 billion in bonuses to certain Merrill executives. Judge Rakoff also wants to know if the $33 million is coming from the $20 billion Fed Chairman Bernanke and former Treasury Secretary Paulson agreed to provide BofA to consummate the merger with Merrill.

Mars and Saturn are affecting BofA CEO Ken Lewis’ natal Mercury in Pisces,* along with SEC Chairman Mary Schapiro’s Mercury and Sun in Gemini, indicating the two have a lot of explaining to do. As I wrote in a post last year, Mars challenging Saturn when the SEC was founded “inhibits its ability to take action.” Unlike other bank regulators, the SEC must turn over the $1 billion plus it earns in transactions fees** every time a security is bought or sold, to Congress who must appropriate its budget every year. Mars/Saturn challenging Chairman Schapiro’s Sun and Mercury in Gemini reflects her dual frustration at not having the appropriate resources or authority (Saturn) to take serious and aggressive action (Mars) against securities violations.

The Treasury will auction a record $75 billion this week: $37 billion in three year notes on Tuesday, $23 billion in 10 year notes Wednesday, and $15 billion in 30 year bonds on Thursday. But the big afternoon event this week will be Wednesday’s FOMC announcement.

Now that the biggest banks are rolling in the profits, it is likely that the Fed will de-emphasize extending the Treasury purchase program and purchase of agency MBS. In keeping with the planetary influences this week, it would be interesting if the phrase “dual mandate” was incorporated into the FOMC announcement. With Mars and Saturn challenging his natal Sun and Jupiter now, Bernanke is under pressure to defend his economic philosophy that partially conflicts with the Administration’s regulatory reform proposal, along with resisting the growing call to have the GAO audit all of the Fed’s special lending programs and their financial arrangements.

The Leo Sun opposite Jupiter on Friday can be overconfident, creating a clash of egos (along with a tendency to exaggerate and overspend). Friday’s CPI could show inflation higher than expected, echoing July Personal Spending that was higher due to an increase in food and energy costs.

Monday, August 10, 2009
Selling pressure keeps market in negative territory.

Tuesday, August 11, 2009
Choppy/mixed; swings from moderately down to moderately up for most of the morning before turning negative.

Wednesday, August 12, 2009
Negative, but begins to improve in late morning to early afternoon and turn choppy/mixed to moderately up.

Thursday, August 13, 2009
Positive; rapid gains as morning progresses but profit taking could cause market to begin to weaken in mid afternoon.

Friday, August 14, 2009
Volatile; large moves in either or both directions, but tendency is to the downside.

*Shareholders in April voted to strip Lewis of his position as Chairman. The House Oversight Committee is extending its investigation of the BofA/Merrill merger after a Wall Street Journal article last week described an email sent by BofA’s Chief Accounting Officer to top executives two days before the December 5 shareholder vote that Merrill’s Q4 loss projections had increased by $2 billion.

**This is not a transaction fee but in essence a tax payable to Congress who ensures that wrongdoing is not properly prosecuted at the expense of investors.

Mary Schapiro: June 19, 1955 time unknown New York, NY

No disclosure.

WallStreetWeather.net Forecast For Week Of August 3, 2009

Summary Of Last Week’s Influences:
The DJIA gained 725 points in July, its best monthly performance since October 2002. The S&P500 experienced its best five months since 1938, and on Thursday was just shy of reaching 1000. The NASDAQ reached 2009.81 intraday Thursday, gaining 7.8% in July. Yet the indices barely gained for the week.

Mercury’s opposition to Jupiter and Neptune did result in “outsized moves” in both directions in crude oil which closed just below $70/barrel.

Since Newsweek proclaimed the “Recession is Over,” Wall Street shifted its focus to Washington. Gemini rules motor vehicles, and Venus (spending) and Mars (action) in Gemini brought a surge in buyers eager to trade in their clunkers. The $1 billion in the government’s “Cash For Clunkers” program ran out at midnight on Thursday, and by 1:22 PM Friday the House (316-109) had approved an additional $2 billion for the program.

Cash For Clunkers is a lot like our current healthcare system: some people benefit, millions do not, and most do not realize the risks of our current system. The House Energy & Commerce Committee 31-28 passed their healthcare reform bill at 9:05 PM Friday. All the Republicans and five Blue Dog Democrats on the committee voted against the bill. The dirty little secret of the “free market” Republicans and Blue Dog Democrats is that if it wasn’t for the government through its regulation of employer sponsored healthcare, Medicare and Medicaid, the current system would not have survived.

Summary Of This Week’s Influences:
Wednesday’s Solar Eclipse in Aquarius marks the end of the current eclipse cycle until the Blue Moon* Lunar Eclipse on New Year’s Eve. As Jupiter and Neptune move further apart from their spring and summer pairing and Saturn and Uranus begin to approach their mid-September opposition, financial markets are likely to become more cautious and volatile.

Mercury is in its “home” sign Virgo August 2 to August 25. The planetary energy of communication in the sign of the bookkeeper emphasizes accountability, reviewing all the fine print and the numbers behind the numbers. Thoughts and communications center on work issues and healthcare. Mercury harmonizing with Pluto in Capricorn on Monday could bring forward information previously hidden or overlooked. There will be a second opportunity to dissect and perfect work in process now between September 17 to October 9 when Mercury returns to Virgo, due to Mercury retrograde from September 7 to 29.**

The big economic event this week is Friday’s Employment Report for July. Consensus estimates are for a loss of 333,000 jobs and the Unemployment Rate moving slightly higher to 9.6%. Mars challenging Saturn (exact August 10) reflects that jobs and hours worked continue to be reduced.

Monday, August 3, 2009
Positive, then weakens in late morning to choppy/mixed to negative before improving in afternoon.

Tuesday, August 4, 2009
Positive early, then starts losing momentum and becomes choppy/mixed to moderately up.

Wednesday, August 5, 2009
Negative; but starts improving to choppy/mixed by early afternoon. Market strongest going into the close.

Thursday, August 6, 2009
Positive, then weakens to choppy/mixed. Improves again around midday/early afternoon, then weakens and turns negative going into the close.

Friday, August 7, 2009
Volatile; negative bias.

*Two Full Moons in the same month.
**Planets do not really move backward but appear to from Earth’s vantage point.