Spiga

Where is the Real Estate / Equity Bottom?



Its a little too early for this, but some research on the golden mean, and fib lead me to numerology, and that grand interpretation of it; astrology. Here is the short of it from one house:

Based on past history, we can expect the downtrend in housing to turn around when the North Node reaches the constellation opposite Cancer, where it usually is when prices rise. That constellation is Capricorn and the North Node is due to enter it in August 2009, 20 years after the last low in 1989.

But don’t rush headlong into the real estate market in 2009 without being aware of two major reasons the RE cycle may again be distorted and its downside extended.

1. Astrologically, Uranus and Pluto will be within orb of a square, with Pluto opposite the US natal cluster of Venus, Jupiter and Sun in Cancer. And Saturn will be moving through Virgo, coming conjunct the US Neptune, which is square the US Mars—a combination that has coincided with stock market crashes historically. Also, in 2009 Pluto and the North Node will conjoin in Capricorn. The combined effect of these astrological patterns bodes ill for the overall economy, of which the housing industry is a major part.

If the dollar crashes or continues its slide down against other world currencies, foreign investment in US assets (a major stimulus to the most recent housing bubble) will be withdrawn, worsening the situation by exacerbating US debt—federal, corporate and personal. The world’s monetary system, now based on the dollar, is likely to go through a wrenching change, mainly because US total debt is approaching the point where it will be un-repayable, which in turn could lead to a change in the existing Fed-dominated, debt-based monetary system.

During the RE bubble that followed the stock market crash of 2000-2001, a lot of investment money went into real estate, and prices continued to rise after the North Node went into Gemini. As a consequence of the boom and the Fed’s holding interest rates down, the housing bubble was extended beyond the average cyclical top. As a consequence of that extension, the RE price bottoms may be extended beyond 2011.

The longer cycles of the outermost planets overwhelm shorter cyclical indicators to concur with well-defined economic turning points. And we are moving toward one that can be expected to bring the most difficult decade since the USA was founded in 1776: Pluto moving though Capricorn, a Uranus-Pluto square lasting from 2008 to 2019, forming a grand cross with the natal US Sun-Saturn square. In August 2009, Pluto will conjoin the North Node in Capricorn, with both opposite the USA’s natal Jupiter and Venus. This combination can be expected to distort the RE cycle, and more importantly, bring an atmosphere conducive to changing some basic economic assumptions. This difficult period could be a blessing in disguise.

So we shall see.....

What about equities, the markets and metals?

We are currently in the decade of a “Triple Saturn Oppositions.” This was described in last year’s Forecast Book in great detail. This is when each of the 32-45 year cycles between Saturn and the planets outside of its orbit (Uranus, Neptune and Pluto) come into an aspect of an opposition. It doesn’t happen very often that these three oppositions unfold within a span of just ten years. In fact, it has happened only three times in the history of the U.S. stock market (last 200 years). In each case the stock market made a new all-time high. And in each case a prolonged bear market followed that lasted at least 23 months, and prices dropped at least 40%.

Do I think the stock market has now topped out and such a bear market is beginning? No, not yet, although that opinion could change depending on market patterns that could unfold at any time. I believe that before the final top is in, we have to get within 10 months of the Saturn-Uranus opposition, the last of the three Saturn oppositions that will take place November 2008 through July 2010. After all, this signature (and its conjunction) has the highest correlation of any planetary combination to very long term cycle highs or lows.
So we shall see

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