Summary Of Last Week’s Influences:
The major indices experienced their largest weekly decline last week since hitting multiyear lows last March. Markets chalked up the losses to China’s regulators cutting back on bank lending, fears over Greece’s sovereign debt, President Obama getting tough on the big banks after Republican Scott Brown won the Massachusetts Senate race, and concerns that the Senate might not confirm Federal Reserve Chairman Bernanke to a second term.
Regardless of the reasons, Saturn square Pluto is injecting caution over concerns that the market has went too far, too fast and is overdue for a correction.
Summary Of This Week’s Influences:
Mars in Leo pushes its way to the forefront to let Saturn and Pluto know that just because Mars has been retrograde since December 20 does not mean its energies are not influential!
Mars in Leo will form its third and final challenging alignment to Mercury in Capricorn on Monday,* oppose Venus in Aquarius Tuesday/Wednesday, and oppose the Sun in Aquarius on Friday. The Moon (sentiment) will enter Leo on Friday with the strong Mars influences culminating at the Leo Full Moon early Saturday at the same time Saturn squares Pluto.
Since Mars is the closest to the Earth it has been in two years, these aspects can quickly raise people’s level of frustration and anger, creating hurt pride and bruised egos. The Mercury/Mars alignment reflects the need to make adjustments in order to effectively get your message across. Venus opposing Mars can make it more difficult to relate to others and particularly create tension in romantic relationships. The Sun’s opposition to Mars can create a battle of wills as there is a strong need for self-expression and gaining control (Saturn) through manipulation and power struggles (Pluto).
From a financial perspective, the combination of these energies will likely increase volatility and fear in the market from concerns arising from news (Mercury) coming from the government and corporate earnings (Venus). In addition to the fears of tighter regulation, global stimulus measures coming to an end, and companies not exceeding lofty future earnings projections, the Mars aspects raise the possibility of violence and military actions resulting from geopolitical tensions.
With the Sun and Venus in Uranus-ruled Aquarius opposing Mars, volatility is likely to increase as market sentiment can quickly move from one extreme to the other. This also increases the possibility of intraday reversals as the market reacts to unexpected events.
Mars is action and Leo is speculation. Mars retrograde is a time to review past actions. As I wrote in the Mars in Leo post, Mars retrograde at the same time Saturn squares Pluto would motivate government leaders to restrict speculation on Wall St. President Obama’s amendment to his Financial Regulatory Reform proposal announced last week would prohibit banks from engaging in proprietary trading (trading for their own account). Banks would also not be able to invest, sponsor or own a hedge fund or private equity fund. Additionally the proposal seeks to restrict the combination of deposits and other funding sources whereas currently restrictions only apply to the bank’s deposit base.
Leaders are ruled by Leo and its planetary ruler the Sun. Mars retrograde in Leo brings back leaders from the past. President Obama named the new proposal the “Volcker Rule” after former Federal Reserve Chairman Paul Volcker who I said in the 12/20/09 Weekly Forecast “would be having an expanded role in shaping financial regulatory reform in 2010.” The next time Volcker’s chart will be particularly active is around the March 15 Pisces New Moon which occurs the day before the next FOMC meeting after this one. (I can dream can’t I that Volcker replaces Bernanke?!)
The “Volcker Rule” is a more modified version of The Banking Act of 1933 (“Glass-Steagall”) which separated commercial from investment banking. Mars in Leo reflects a Senate bill to repeal the 1999 repeal of Glass-Steagall which as I wrote in that 12/20/09 post is being affected by the Saturn/Pluto square.
Three leaders will dominate the news on Wednesday, and two have the Sun in Leo. Treasury Secretary Geithner will testify at a House Oversight Committee hearing investigating the government’s payment in full to AIG’s counterparties. (Former Treasury Secretary Hank Paulson and Stephen Friedman, the former Chairman of the NY Fed, have been invited to testify.)
In a November post I wrote that Geithner would come under questioning in early 2010 over AIG. The January 15 Solar Eclipse conjoined Geithner’s Saturn in Capricorn. Mercury conjoining Geithner's Saturn and Jupiter, and Jupiter in Pisces opposing his Pluto next month could raise ethcal issues that might lead to legal troubles. Neptune in Aquarius opposing his Sun/Uranus conjunction in Leo and the Full Moon squaring Geithner’s Neptune in Scorpio raise the potential Geithner was not forthcoming in his communications during the AIG crisis last March.
And if Geithner was not forthcoming, that doesn’t reflect well on Ben Bernanke who was his boss when the government took 79.9% control of AIG. Bernanke has been busy calling Senators while the Administration tries to shore up support to get 60 votes to break the filibuster on his nomination. Bernanke’s term as Chairman expires January 31. Fed Vice Chairman Donald Kohn will take over as acting Chairman of the Fed until he is confirmed or replaced.
The problem with Bernanke is that he continues to deny that the Fed did anything wrong, refusing to acknowledge that the public and many members of Congress are fed up with him for perpetuating the failed policies of Alan Greenspan. He has done nothing whatsoever to help consumers. Someone needs to ask Bernanke why banks are charging consumers up to 30% interest on credit cards while paying consumers less than 1% interest on bank deposits.
The Administration and Bernanke’s supporters are trying to make Bernanke into a hero for preventing Depression 2.0 when the Fed’s policies and lax regulatory enforcement created the crisis in the first place! And now they’re trying to convince the Senators to vote for Bernanke to prevent the stock market from declining further. Keeping Bernanke at the Fed or replacing him with another Greenspan devotee completely conflicts with the Administration’s financial regulatory reform proposals and shows the politicians care more about zero interest rates than a sound economy. Besides, Bernanke has been vigorously campaigning against any proposal that would diminish the Fed’s power and influence. The Full Moon opposes the Federal Reserve’s progressed Uranus in Aquarius, indicating some surprising developments might be in store over the next two weeks.
The FOMC will release its announcement at 2:15 PM Wednesday. While I do not anticipate major changes in the Fed’s direction at this time, the statement could show subtle signs of sympathy to the plight of workers and consumers as a reason to maintain the “extended period of time” phrase in the statement.
As we approach the Full Moon which opposes his Sun in Leo, President Obama will give his State of the Union address Wednesday night at 9:00 PM. (More about the President and his agenda in a separate post.)
Monday, January 25, 2010
Volatile; weak early but improves as day progresses, then declines going into the close.
Tuesday, January 26, 2010
Wednesday, January 27, 2010
Negative, but improving conditions could turn the market positive in early afternoon only to retreat going into the close.
Thursday, January 28, 2010
Positive trend bias.
Friday, January 29, 2010
Volatile; market deteriorates as day progresses, selling into the close.
*This aspect previously occurred on December 21 and December 31, 2009.
** A mathematical calculation that moves the planets forward in time as a method of prediction.