WSNW SUBSCRIBERS may access our current 2001
Non-subscribers note this will be posted on January 1, 2001 here.
Some of the following material has been serialized in our newsletter
STREET, NEXT WEEK and our premium
channels. It was presented publicly at our Annual Astrology and
Stock Market Seminar May 18, 2000 in New York City.
Note: While most links below are free to the public, some are restricted to WSNW Subscribers.
There are 4 primary phenomena affecting world events and global markets in 2000/1:
1. MORE REALISTIC STOCK VALUATION (Jupiter/Saturn)
Get used to DOUBLES instead of TRIPLES - After May, many tech stocks will be given far more conservative targets, i.e. a potential high flying stock in the mid 20's may have a 12 month price target of only 45-55 instead of 75....
Recently, investors would rather play the lottery than get a job. They were more than willing to bid higher companies that have no earnings and cash flow, while many companies with real earnings, real businesses and real assets were ignored. This picture is changing due to the Jupiter/Saturn conjunction as well as the stellium in Taurus this month. Earnings and real business prospects will begin to matter. Hence stock forecasting will become easier and somewhat more rational.
However, if you want to become a millionaire, more people will choose game shows and gambling instead of the stock market route. Seizing this opportunity, we offer kudos to Howard Lutnick, Cantor Fitzerald's CEO, for setting up a new service for gamblers to be able to bid on stock prices without actually buying or selling stocks or options! As the biggest dealer in US treasuries will be initially operating only as a London bookie, we don't expect it to reduce exchange volumes just quite yet.
2. DOLLAR DECLINE ACCELERATING IN 2001 [Euro/Gold up]
If you liked $10 Oil, then you will love the Euro .88-92.
[Note: The next day May 19 was the US$ high and low of the Euro!]
3. JUPITER/PLUTO and SATURN/PLUTO
These aspects plus new FASB rules forecast more failed mergers and corporate break ups.
What comes after the FOMC meeting? We are using the May 5th closing numbers, e.g. Nasdaq 3816, as an interim market trading top for almost all positional shorts. How long will it hold? Will 10800 and 4000 be reached by the Summer? Both numbers make momentum trading on the DOWNSIDE a lot easier and safer.
Except for a few weeks, the remainder of 2000 after May is not "that bad" astrologically. Years ago, I was asked when the stock market would DEFINITELY correct. My answer was: the insanity "HAD TO END between the July 1999 Eclipse and the May 2000 Jupiter/Saturn conjunction." While it has, the question remains, will it go back up? Yes, but it will also go back down.
Fundamentally, many companies [stocks] may do poorly in the first half of 2001. Profits will be challenged by increasing ECI- wage inflation, more Internet usage (B2C, B2B), although that depends on where you are on the supply chain: the Internet will also lower some costs. As we repeatedly have warned, Inflation is NOT dead. Asset (stocks and real estate) inflation is a serious threat beginning to spill over into products and services, the Internet and NASDAQ globalization notwithstanding. We see that selective pricing power is returning. Just recently, the price of breakfast at one local Deli for eggs, toast and coffee was increased to $1.69 from $1.19! Moreover, NY housing prices reached a world record of $3000 a square foot for the new 515 Park Avenue condos being built by Zeckendorf. While Donald Trump brags he can get $4500 sq. foot, I say NOT THIS YEAR, as we are astrologically forecasting declining real estate prices into December-January.
Is Alan Greenspan good for more US interest rates hikes this year? If not, in 2001, it may become necessary to defend the US dollar and that will NOT be cause for a sustainable market rally. We believe by the summer of 2001, the direction of interest rates will be reversing. While we were precise in forecasting a bottom of 4.90 and then a top 6.50, we have yet to see our P2 top of 6.80. (Yields only reached 6.75%, therefore we remain technically bearish on US Bonds short term). While it is possible .50 basis is all that is needed, the Fed by not acting more vigorously in January and February, may, we believe, force it to act again, even in an election year.
Fundamentally, for the stock market in 2000 to rise substantially above 1999 highs or to even close positive on the year, may require the future permission of some social security funds into the market. However, this is a Catch 22 situation, as longer term this would negatively affect bonds and interest rates. But political leaders, like CEO's, for the most part, look to the next quarter, rarely to the next generation.
Will money flows and investor greed, stupidity and insanity continue to keep the market enough above 10,000 and Nasdaq above 3000 to prevent a panic flight to reality? Capital Preservation remains our number one priority for global investors in 2000. Still, this is an election year and we are beginning to lower cash allocation from record levels next week. Whether the market reaches 12,000 or closes this year under 10,000, 2001 investing demands extensive portfolio evaluation, diversification and insurance.
GLOBAL 2000/1 MODEL PORTFOLIO WEIGHTING:
EUROPE: 40% [Holland 20%] US: 30% CANADA: 15% ASIA: 15%
The Horoscope is a MAP of TIME and PLACE - here is a brief overview of selected global markets:
EUROPE - Relative strength in North Euroland & Euro strengthening into 2002
NORTH AMERICA - Traders paradise
ASIA/PACIFIC - Long term investment opportunities
As long as it remains an open question whether a "soft" landing can be engineered or whether a "hard" crash is inevitable sooner or later, we continue to recommend avoiding emerging markets such as Russia (Putin and Kasyanov notwithstanding).
Despite slightly higher interest rates on the horizon over the next
year, real assets are desirable and may outperform financial assets.
Despite the fact that we do live in interesting times, we continue to repeat
our mantra is: BORING IS GOOD.
Basic industries such as Construction, Energy, Real Estate and Utilities are safe haven favorites. But if you are bored, you will also want to be entertained. Our 2000 entertainment recommendations such DIS and TWX should have already been sold. Media stocks such as NYT are holds and buys after stock market corrections. A European conglomerate stock like Vivendi (VVDIY) could be ideal being based in Utilities, Communications AND entertainment. Think in terms of tangibles. If you are a very aggressive investor and have high risk tolerance, some commodities, along with stocks, bonds and cash may be appropriate.
There are two cosmic markers finishing 2000 and early 2001:
If we consider May 3-5 similar to August 87, then the following three weeks could be similar to October 87: due to with cycle compression, the market action unfoldment will occur in days rather than weeks. The month of May is the most dangerous of times, with the highest risk. Maybe nothing will happen, but unless you are prepared for a great storm, you could consider yourself foolhardy in retrospect. Consider yourself warned and act appropriately.
The three July eclipses will be probable pivot/market turns.
We foresee at least one more big up and big down move this fall: One move will be an early October scare ~9/24-5. Another is an election push ~10/10 with an early "January effect": in the Technology sector even more than small caps. Nasdaq is likely to outperform DJIA at that time.
This summer (June 30, 2000) Jupiter moves into Gemini, helping transportation and communication sectors.
We will continue gradual Distribution in Oil sector stocks this summer. Gold and Oil prices to a lesser extent will benefit from future US $ declines.
We recommended extremely high cash positions for the first half of 2000. We believe should the stock market remain robust, there will be more US interest rate hikes. Thereafter, we recommend some accumulation, but European long term foreign investors may need to hedge periodic US Dollar under performance in 2001. while global US investors may prefer German Bonds next year. We continue to recommend holding positions in select natural resources (Gold) and high yielding REIT's.
I begin with one or more of the following 4 criteria:
A. FALLEN ANGELS: 90% from 52 week HIGH or near 2 year LOW
B. CASH RICH, not stock rich (Survival of the Fittest)
C. UNDERVALUED using Business Appraisal methodology, e.g. Morningstar
D. GOOD HOROSCOPE or in upcoming COSMIC SECTOR Theme:
1) Jupiter/Saturn conjunction
2) Jupiter in Gemini
3) Jupiter/Pluto opposition (late 2000)
FAVORITE 2000 STRATEGY HEDGING:
BUYING STRONG STOCKS/MARKETS and SELLING WEAK STOCKS/MARKETS
1. As the S:
Netherlands is our favorite 2000 country, you may wish to accumulate
at least their top 5 stocks in 2000/2001. The Netherlands is the
single best European country to prosper in a borderless Euroland.
This is due to both historic reasons AND the horoscope of the Dutch Stock
Exchange, as well as the individual charts of Phillips, Amro, Unilever,
Buy EWN (Netherlands I-Shares or Webs) or selectively buy some of the following companies:
3. Until Gold reaches our target of price $378, we continue to be relatively bullish on precious metals into 2001. Until Gold is above $325, we continue to prefer the majors: Barrick Gold (ABX), Homestake (HM) and Placer Dome (PDG). Defensive money managers will continue accumulating energy stocks for the long term. We expect to distribute the later two of our three previous top picks Shell (RD), Sunoco (Sun) and Schlumberger (SLB).
4. DJIA FAVORITE 2000/1 stocks, i.e. hold/buy on an intermediate-long term on a relative basis, General Electric (GE), General Motors (GM) and IBM.
5. FUTURE TECHNOLOGIES
Since before we became one of the first apple dealers in NYC, we historically have liked betting on small and micro cap public companies. This we recommend doing in a basket of stocks. See our S: LAS VEGAS INVESTING posts. Our current five favorites are:
APPLIED ROBOTICS: International Hi-Tech Industries (IHITF)*
BIOTECHNOLOGY: Celsion (CELN)
INTERNET BUSINESS: Wamex (WAMX)*
ONLINE EDUCATION: VCAMPUS (VCMP)
SUCCESSOR ENERGY: Energy Conversion Devices (ENER)
*6. AFUND CLIENTS
Business Astrologers know that the best way to predict the future is to create it.
With strong disclaimers and with an obviously biased view, I am doing my best to help create investor wealth for companies we now consult for.
1. EWN- Dutch/Euro themes.
2. GE - Best DJIA Horoscope and fundamental meeting of earnings expectation
3. GM - Transportation (Jupiter in Gemini) and value themes.
4. ABX (HM)- Gold, Canada and US dollar decline themes.
5. 50%-50% combination of IBM and QQQ - or Future Technology Stock basket
[20%@ IHITF, CELN, WAMX, VCMP, ENER] - Technology theme.
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