The end of July and early August have various energy patterns that could prove explosive, with drastic changes and unexpected situations that could rock the world and shake us to the core.
My verbiage may be somewhat dramatic, but I fear we have been lulled into a sense of complacency. Or could the disposition be one of overload and overwhelm whereby we have become numb and even catatonic to the world changing around us?
From the 23rd of July through the 10th of August, the currents seem rapid and the waves tsunami-like. The key players in this configuration all link up to the Grand T-Square of Saturn, Uranus and Pluto with Jupiter and Mars being significant contributors to this hurly-burly energy vortex that can dive down, down, down, all the while that things are being presented as being up, up, up.
Although we have all heard the words of being on the road to recovery, various black swans, even if surmised or hypothesized about, may only now be coming into evidence. Black swans are those unexpected and highly significant situations that put a damper on the consensus and throw monkey wrenches into the spokes of the wheels of any semblance of normalcy and regularity.
I have repeatedly suggested that the economic crisis, referred to as the Great Recession of 2008-2009, was but the tip of the iceberg and the iceberg becoming far more evident and even more dangerous as we come into 2011.
With the world economies being far more integrated than in times past, any pebble in the pond can cause ripple effects far and wide. And the ripple effects towards the end of July into early August could be quite severe.
Some of the present patterns operating have a resonance to patterns that occurred during the latter part of the 1920’s into the early 1930’s, and also occurred during the 1770’s.
The T-Square about which I am extremely concerned, is the Saturn in Libra opposed Uranus in Aries and both square Pluto in Capricorn, also known as the Cardinal Climax.
On the 24th of July, Jupiter transiting Aries squares Pluto. The 26th has Saturn opposed Uranus, the last of the five opposition aspects between the two planets that have gone on since the Autumn of 2008. The 30th has Mars opposed Uranus, followed by Mars conjunct Saturn on the 31st. As we come into August, Jupiter squares Pluto on the 3rd. The 4th has Mars creating a T-Square as Mars opposes Jupiter and squares Pluto. Things that start towards the end of July could crescendo around the 4th of August with continuing ripple effects felt on the 7th with Venus opposed Uranus, Venus conjunct Saturn on the 8th, Venus opposed Jupiter on the 9th, and Venus square Pluto on the 10th.
These times would suggest a strong commitment to conservatism regarding investments, with a bear-like approach, and limiting financial expenditures. Either holding strong for the long-term, and perhaps a very long term, or cashing out might be wisely considered. Any equity market rallies could prove to be bear traps, tempting the unsuspecting and oblivious to buy into the hype that ‘happy days are here again’.
Trust your instincts. Listen to your inner voice. Even if we do not like what we feel or intuitively understand, do recognize that one of our characteristics is a true inner knowing.
The energies during these times of late July – early August are explosive. There could be war-like intonations, violent actings-out, severe atmospheric storm systems and intense earthquake or volcanic activity.
Since the energies can be too hot to handle, there can be miscues, wrong actions and even reactions that are overboard and likely unwarranted.
The collateral damage of recent economic malaise can be reaffirmed with increased unemployment figures, credit crunch problems and even too big to fail ventures falling on hard times.
Even sovereign debt could prove a worry with austerity measures announced being received by demonstrations and violent protests in the streets.
We might even become aware that some of the proposed solutions, and even the remedies implemented, have little impact to address, much less relieve, economic problems. Analysts now concede that the stimulus programs in the US had only short-term implications avoiding a collapse of the global economic system but negligible long-term effects, except for ratcheting up the tax burden for an indefinite period of time.
Will it become apparent that the ‘recent recovery’ has only been a bear-trap rally and that the likelihood of a double dip recession is increased?
Possibly so. I do not wish to be the harbinger of ‘doom and gloom’. I would prefer to leave such characterizations to the likes of Dr. Nouriel Roubini of NYU, named ‘Doctor Doom’ by The New York Times, or Dr. Marc Faber of the Gloom Boom & Doom Report, also often referred to as ‘Doctor Doom’.
Where is Chicken Little now that we need her?
Okay, maybe I need to accept the role. What I am trying to make you aware of is the fact that rosy pictures regarding the world economy are distortions seen through rose-colored glasses. The sky is falling! Should I repeat it? The sky is falling!! But not in the literal sense as much as the figurative sense. We are moving from one paradigm into a totally new paradigm. In the process, certain situations and institutions are likely to go by the wayside. Similar to our moving residence, there are collateral costs — in time, expense and emotion.
There are some very stressful energies coming up, and I would suggest, one more time, that we have only seen the tip of the iceberg and that the iceberg can become more evident during this latter part of July into early August with some of its implications and consequences felt more severely in 2011.
To change analogies for the moment, let me suggest and make you aware of potential black swans…
While black swans can be positive events or negative events, they share the characteristics of being unpredictable and highly impactful. Based upon the forthcoming energies, I would suggest the following negative black swans could come forward.
Black Swans A’Swimming…
1. The end of July and early August could see some earnings announcements and forward earnings estimates raise questions as to the strength of the economic recovery and job creation. If we are in any form of recovery, which I suggest to be minimal at best, then the recovery is a jobless recovery with continued high unemployment and the need to implement long-term unemployment benefits. With such a high degree of uncertainty both in regard to the strength of an economic recovery and the costs associated with new programs being implemented, companies would be leery of investing in greater job creation.
2. As of July 12th, there had been for the year 2010 in the US 91 failed banks and 10 failed credit unions with the FDIC suggesting that failed banks may peak in 2010. Or not.
3. Foreclosures & Bankruptcies. Yogi Berra made famous the philosophy of ‘It ain’t over ‘til it’s over’. We could see spikes in home foreclosures and personal bankruptcies and even corporate bankruptcies. Yes, the wave of foreclosures and personal bankruptcies may not yet be over.
4. Sovereign Debt. We have been made aware of the problems in the Eurozone with Greece being bailed out from likely default, but there are other problem countries in the Eurozone often referred to as the PIGS [sometimes PIIGS], with Portugal, Italy, Ireland, Greece and Spain being worrisome nations with severe debt problems. But we might also consider nations such as Japan, the UK and the US with potential debt problems as well.
5. Nations, States, Municipalities. We are seeing the debts of nations ratcheted up during this great recession. And we are hearing of various US states [e.g. California, New York, Illinois now being referred to as Greece by the Lake] running huge budget deficits. Municipalities are looking to avoid bankruptcy by consolidating services with other municipalities or contracting out services.
6. The Baltic Dry Index, often used as an indicator of global trade levels, shows a slide of over 50% since late May, giving concern regarding slower global economic growth and a stalling of the global economic recovery.
7. Different Strokes for Different Folks. While some countries are emphasizing austerity [EU] over stimulus [US], even stimulus programs have offered nothing more than a short-term shoring up of financial structures with little long-term benefits to job creation or economic development. Printing money can grease the wheels but eventually a price has to be paid [need we historically recall the experience of Germany between the two World Wars?]. Austerity programs cut back on social services, benefits and the like thereby impacting the consuming public. With 70% of the US GDP consumer spending, if consumers don’t spend, then the economy has difficulty in growing.
8. Consumer reluctance. The level of anxiety in the public is based upon the future and the need now more than ever to save for a rainy day. Unfortunately, when it rains, it pours and the consumer may find that their disposable income is weakened by deflation, user fees and various forms, overt and covert, of tax increases.
9. Geophysical Activity. I have often suggested that part of the Pluto in Capricorn influence is the idea of building upon rock or building upon sand, with the latter being swept away. The energies now could ratchet up geophysical activity in the form of volcanic and earthquake activity. Could we see more volcanic activity out of Iceland with its economic impact due to disruption of European air travel?
10. Storm Systems. The potential for increased damage from various storm systems seems strong with high winds and flash floods.
11. Demonstrations and protests. The energy is so intense that it may affect people as if every day were a Full Moon day. People are likely to be taking to the streets venting their frustration, giving evidence of their sense of vulnerability.
12. Some of the energies of this time do speak to increased terrorist activity. Whether attempts can be foiled or not, any sense of terrorism can ratchet up the anxiety level.
13. Crop damage. With aberrations in climate conditions, and extremes in temperature and in precipitation, we should have concern about crop damage and its impact on food costs.
14. Et Al….
Remember that black swans are highly unpredictable and highly impactful.
I do not raise these issues to create anxiety or fearfulness. Rather, I suggest that we have been conditioned, even prepared, for even more significant waves. But let’s always keep in mind that we are never given more than we can handle, even if we find ourselves surfing the precipice.
To reiterate, conservatism regarding our investments and our finances would be encouraged for this end of July early August period. It would be wise to bear in mind that next year could be even more challenging, especially for various governments and countries, including the US, the UK and China.
Taxes, in their various forms, are likely to be significantly increased.
But, despair would do nothing except bum us out. Through our due diligence, our ability to be flexible and adapt to changing conditions, we can in deed have brighter days through better ways.
To close, I would suggest we all keep in mind the words and sentiments of Rudyard Kipling’s poem ‘If’ [please read as gender-neutral]:
If you can keep your head when all about you
Are losing theirs and blaming it on you;
If you can trust yourself when all men doubt you,
But make allowance for their doubting too;
If you can wait and not be tired by waiting,
Or, being lied about, don’t deal in lies,
Or, being hated, don’t give way to hating,
And yet don’t look too good, nor talk too wise;
If you can dream – and not make dreams your master;
If you can think – and not make thoughts your aim;
If you can meet with triumph and disaster
And treat those two imposters just the same;
If you can bear to hear the truth you’ve spoken
Twisted by knaves to make a trap for fools,
Or watch the things you gave your life to broken,
And stoop and build ’em up with wornout tools;
If you can make one heap of all your winnings
And risk it on one turn of pitch-and-toss,
And lose, and start again at your beginnings
And never breath a word about your loss;
If you can force your heart and nerve and sinew
To serve your turn long after they are gone,
And so hold on when there is nothing in you
Except the Will which says to them: “Hold on”;
If you can talk with crowds and keep your virtue,
Or walk with kings – nor lose the common touch;
If neither foes nor loving friends can hurt you;
If all men count with you, but none too much;
If you can fill the unforgiving minute
With sixty seconds’ worth of distance run –
Yours is the Earth and everything that’s in it,
And – which is more – you’ll be a Man my son!