Weekly Column: Money ain’t for nothing

Review and preview 

Job growth was much better than expected in November despite the Federal Reserve’s aggressive efforts to slow the labor market and tackle inflation. Nonfarm payrolls increased 263,000 for the month while the unemployment rate was 3.7%. In another blow to the Fed’s anti-inflation efforts, average hourly earnings jumped 0.6% for the month, double the Dow Jones estimate. Wages were up 5.1% on a year-over-year basis, also well above the 4.6% expectation. – Jeff Cox, “Payrolls and Wages Blow Past Expectations,” www.cnbc.com, December 2, 2022.

Yields on longer-term U.S. Treasurys have fallen further below those on short-term bonds than at any time in decades, a sign that investors think the Federal Reserve is close to winning its inflation battle regardless of the cost to economic activity. A scenario in which short-term yields exceed long-term yields is known on Wall Street as an inverted yield curve and is often seen as a red flag that a recession is looming. – Sam Goldfarb, “Treasury Yield Curve Inverts to Deepest Level Since 1981,” Wall Street Journal, November 30, 2022.

The holiday joy continued for world equity markets after Fed Chair Powell’s comments on Wednesday that rate hikes won’t end, but may ease the pace of their ascent. On that news, most of the world stock indices made new cycle highs on Thursday-Friday, December 1-2, and in some cases they exceeded the highs of their previous primary cycles made in mid-August.

In Europe, all four of the indices we track took out their highs of August except the Netherlands AEX, which missed by less than two points.

In Asia and the Pacific Rim, all markets rallied last week, but only the Australian ASX and India’s Nifty took out the highs made back in July-August. The Nifty was even more spectacular, soaring to a new all-time high on Friday. China and Hong Kong rallied to their highest levels since September, but Japan’s Nikkei index failed to even take out the prior week’s high, for a case of intermarket divergence in that region.

In the U.S. the DJIA surged to 34,595, its highest level since April. The S&P and NASDAQ made new cycle highs on Thursday, but remain well below previous primary cycle crests made in mid-August for a developing case of intermarket bearish divergence here, as well.

Precious metals had a stellar week with Gold soaring to 1818.70 on Friday, up $200 from its yearly low of 1618.30 made only one month ago, November 3. Its previous primary cycle crest was 1824.60 on August 10. Silver also blasted off, rising to 23.47 on Friday. That is its highest price since April. Bitcoin also experienced a modest rally, up to a high of 17,276 on Thursday after its yearly low was made on November 21 at 15,479. It still isn’t safe as we describe in our weekly and daily reports. Crude Oil was also interesting, dropping to a new cycle low of 73.60 on November 28, very close to Trader Joe’s publicly stated target $67-72 to replenish the nation’s Strategic Petroleum Reserves. By Friday, it had rallied back to $83.34. Did he miss it? Or was he in there fading (buying) the market before it reached his objective?

All in all, it was a week typical of several planets in the optimistic sign of Sagittarius. But there are cosmic minefields ahead these next two weeks that could bring forth some whipsaws.

Short-term geocosmics 

“Earmarks are one of the most corrupt, inequitable, and wasteful practices in the history of Congress,” read a letter signed by representatives of 15 groups. The GOP swore off earmarks in 2011, when it stood for something other than investigations. But when a Democratic Congress in 2021 announced intentions to bring them back, GOP trough-feeders rushed to sign up… Self-awareness isn’t one of the modern GOP’s strong suits, as House Republicans proved again this week. – Kimberley Strassel, “The GOP Spending Poseurs,” Wall Street Journal, December 1, 2022.

As discussed last week, we have exited the time band for several favorable Jupiter aspects, but remain under Sagittarius (Jupiter’s home sign). Both Jupiter and Sagittarius like things to be big and optimistic in thought and behavior, but can also be given to exaggerating just how good things really are, when maybe they are not quite that positive. But hey! Who wants negativity? Certainly not Jupiter and Sagittarius. Get out of Sag’s house if you are a pessimist! Go next door to Scorpio or Capricorn, please.

Now what happens when you bring in Neptune and Mars over the next two weeks? Neptune turns direct this weekend, followed by Venus and the Sun making a square to it, December 4 and 14. During the middle of this period (December 8-9) there is a full Moon in Gemini conjunct Mars retrograde. Neptune is passive and Mars is aggressive. And the Sun and Venus are in Sagittarius, which is exaggerative. That should be fun. It’s a combination where truth and clarity are apt to be hard to identify, and facts are at a premium compared to fabrication, rumors, and intent to avoid accountability, which is in abundance. In this type of geocosmic environment, markets can experience sharp price swings. Equity levels were at cycle highs last week, but the cosmic picture suggests there could be a sharp pullback starting at any time this week.

Speaking of Neptune’s propensity to mislead and misdirect, note Kimberley Strassel’s Wall Street article on Friday quoted above regarding politicians’ promise to be financially responsible, then their eager willingness to abandon their fiduciary responsibility by bringing back pork into any and all bills while inflation is increasing.

Longer-term thoughts and opinions 

“Culturally and personally, we ought gradually to reorient ourselves towards moral excellence, pursuing fairness, resilience, and compassion, recognizing that victimhood is not a virtue.” – Richard Gunderman, M.D., Indiana University, “Tweets of the Week,” Arizona Republic, November 26, 2022, 

President Biden has tried to pull a constitutional trick for the ages by ordering the forgiveness of up to $20,000 per borrower on his own authority. Congress had given the executive no such power, as even Mr. Biden had previously noted. But an election loomed, Democrats looked to be in trouble, and in August the President declared one of the greatest vote-buying exercises of all time. If a President can burden taxpayers to the tune of $420 billion with so flimsy a legal rationale, and without the consent of Congress, we are close to government by King that America’s Founders wrote the Constitution to avoid. “Biden’s Loan Forgiveness Reckoning,” Opinion Page, Wall Street Journal, December 2, 2022.

Speaking of fiduciary responsibility…. It is a nice gesture to offer college loan forgiveness via the nation’s treasury funded by citizen’s taxes. However, the U.S. is in so much debt, which has contributed to this historic rise in inflation, that one has to wonder why the U.S. leadership thinks it is a good idea to forgive individual loans of any part of the population. Is it fair to those who also have debts, but not for college degrees to be paying for loans willingly agreed to by college students, present or former? If anything, shouldn’t these loans be paid for – forgiven – by the universities that have increased their tuition and fees to such an astonishing and profitable rate in the past few years? My granddaughter (yes, I have granddaughters about to go to college) just got accepted into an excellent and prestigious college. Guess what the annual costs are to attend this university? Over $80,000. For one year. Just a little more than 12 years ago, two of my children were paying $10,000-20,000/year for their university education. How did this happen?

The case of whether Biden’s executive and unilateral decision (without consent from Congress) to forgive student loans is legal or not will now come before the Supreme Court. But the point I really want to get at is: should entities in debt ought to be going further into debt by forgiving loans to others who agree to take on that debt? The question of who is really in a position to be forgiving debts is a timely Pluto/Neptune theme?

If anyone should be forgiving debts, perhaps it should be the Federal Reserve, which has transiting Pluto in opposition to its Neptune now. It added handsomely tour national debt by printing money out of thin air and then loaning it to a careless Congress to spend as if the concept of Modern Day Monetary Theory is anything other than an expression of an overactive Neptune pipe dream. And the piper will have to be paid by someone at some point, because …  money ain’t for nothing.

I think when Pluto enters Aquarius back and forth five times between March 23, 2023 and November 19, 2024, we will have to have this conversation. After all, 0° Aquarius is the “super charged degree” that began the “New Aira” (thank you, Kat Powell, for that term), when the 20-year Jupiter/Saturn synodic cycle kicked off on December 21, 2020, ushering in a 140-year period where the next several Jupiter/Saturn cycles will all take place in air signs, something that hasn’t happened in about 800 years. Jupiter and Saturn also represent new directions in education. In Aquarius, education on all levels is headed for free, for Aquarius wants the freedom to learn as well as freedom from oppression and debt, which are all closely intertwined. The seeds for this renaissance are being planted from 2023 through 2026 as outlined in this year’s Forecast 2023 Book.