WALL STREET, NEXT WEEK

Financial Astrology for successful investors and traders"   
 
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WALL STREET, NEXT WEEK: OCTOBER 6, 2003
FINANCIAL ASTROLOGY FOR THE SUCCESSFUL INVESTOR AND TRADER

1. OCTOBER MARKETS
2. UP STARS/DOWN STARS
3. ASTRONUT
4. QUOTES
5. ON THE WEB
6. LETTERS
7. AFUND LETTERS

1) OCTOBER IS MARKET LIFEBOAT DRILL MONTH
Will there be another October scare? Maybe, maybe not, but you should have your market “go bag” prepared, just in case.  I often claim that financial astrology allows you to make more money with less risk. One of the many reasons is that over the long run, the most successful investor is the one who is surprised the least. Given October’s reputation, plus Saturn’s (payback time) transit over the US horoscope as well as President George Bush’s, it is prudent to be as cash rich and debt free as possible this month.

October 8 is our next market marker day- when we get an important clue as to what the Fall 2004 Zeitgeist will be. Will investors become realistic and less speculative?  Interestingly enough this cosmic marker follows the mundane California recall election of October 7 and precedes the Treasury Department introduction of a colorful redesigned $20 bill on Oct. 9. Then it is punctuated by an important Full Moon the morning of the 10th. It seems that politics will have an increasingly important economic role in markets between now and November 2004: Duh!

EARNINGS SEASON: BEAT, HIT OR MISS FORECAST?
ONE DOWN, TWENTY-NINE TO GO?
Eastman Kodak is on it way out of the Dow.

ONE DOWN, NINTY NINE TO GO?
SUN (SUNW) now a billion dollars poorer with earnings and sales lower than expected, will it hold or break $3?

Factoid: US consumer confidence is at its lowest level since the start of the Iraq war.
Trading Note: October has several potential 150+ point UP/down days- USE STOPS!

KEYDATES:       October 6, 8, 10
DJIA:                   Support S1 9250 S2 9000 S3 8800 Resistance R1 9331 R2 9400 R3 9550
NASDAQ:          1800 Pivot
GOLD:                S1 369 S2 374 S3 380 R1 385 R2 388 R3 395 R4 398 R5 400

DON’T BUY AND HOLD.THE STOCK MARKET IS LIVING ON BORROWED TIME: DJ FV 8050.
ELIMINATE ANY MARGIN DEBT, BE HIGHLY LIQUID AND BE SURE TO KEEP A BALANCED AND DIVERSIFIED PORTFOLIO! Just 3 DJ Stocks offer 5%+ Dividends.
Q3 2003 Market TOP:    SPX 1040 DJIA 9686 NASDAQ 1913
Q4 2003 targets:     SPX   933 DJIA 8811 NASDAQ 1502?
12/31/2002 EOD:    SPX   879 DJIA 8341 NASDAQ 1335.

2. IS ONLY GOLD IS AS GOOD AS GOLD?
As the business press has finally noticed, geopolitical uncertainty, war, global economic sluggishness and a weak U.S. dollar are good for gold companies. The major factor providing intermediate term support for gold is that a further decline in the US dollar is practically inevitable. An interesting historical note: Gold was a traditional safe haven until the first Gulf War. Now, after the second Gulf War, it is again. One short term positive is seasonal strength. Bearishly, current physical demand is not that great, while happily looming in the not so distant future, will be soaring Chinese demand (over taking India).  

Just as IBM and GE are DOW bell weathers for DOW, so is Newmont (NEM) for gold in BIG money portfolios. FYI: Last century, it was ABX, when hedging wasn’t such a dirty word. My favorite major is Placer Dome (PDG). Still, we sold PDG at last week’s highs, as I personally don’t like to chase hot sectors, but wait for a correction to rebuy as we started to last Friday.  One aggressive alternative is Freeport McMoran Copper & Gold, perhaps the most undervalued major. Buy FCX only if you are up-to-the minute in Indonesian politics (I am not).  Some analysts prefer buying bullion as a safer way to go, as things can always go wrong with a gold company.  No matter, most investors should hold a core gold position as a portfolio hedge, especially given low downside risk before November 2004.

We continue to underweight gold midcaps as investments given they already have built in a gold price of $450.  Alternately, astute traders can periodically Sell HUI/Buy XAU. If you prefer the adventure of finding buried treasure as I do, there are nearly 1000 mining exploration or development stage companies on the TSX alone. I recommend putting from 10% to20% of my gold allocation [not total portfolio, but of commodities allocation] into a group of 5 microcaps, which, with obvious bias, include AFUND clients Gallery and Osprey. Will gold end 2003 closer to $369, $380 or $450? If gold drops, my loss will not be too great, but in the case gold does explode, I am likely to partake in the gold rush up to 100% increase even without one of these companies striking. In addition, to our two AFUND clients, Gallery and Osprey, the three other gold microcaps we recommend investigating are….”
WSNW subscribers should visit our S:MINING 2003 premium post for more.  

3. Last month there was some concern that a Giant asteroid could hit Earth in 2014. See Savings plans and Armageddon. What would this mean for insurance companies? Time to sell quickly before disaster strikes? Nah, don’t worry; Wall Street would have waited until 2013 before reacting, if at all. I believe there is more reason to should worry about the Solar Eclipse this November and the Saturn/Neptune squares in 2005 and 2006.

These days I prefer insurance companies to banks and brokerages. Most fund managers, for whom price is no object love AIG. [AIG, along with Cisco, are the most likely replacements for EK in the next Dow Jones reshuffling.} My current three favorites are: Aegon (AEG), AFLAC (AFL) and Canadian SunLife (SLC) even though they are not likely to benefit from the current merger mania such as John Hancock and Canadian Manulife combining into the No. 2 insurer in North America and No. 5 in the world.  FYI: We rate MFC a short term neutral, but a 2005 outperform

4. "There's a perception that stocks are overvalued, and that's holding the market back."
Stephen Massocca, president, Pacific Growth Equities
HW: Given perception of reality partially creates a reality feedback loop, I see markets as most toppy.

"America is not very attractive for European investors these days with the risks of a weakening dollar spoiling returns."
Michael Fuchs, head of equities, AMB Generali
HW: Asian investors are hardly thrilled too. Given Saturn’s approach to both the US Sun and President Bush’s, US investors are likely to join the party and feel the same way.

"There's no compelling reason to hold U.S. equities. Until we see some real growth in employment and income, which feeds into capital expenditure, I don't see a recovery under way."
Lochiel Crafter, chief investment officer, State Street Global Advisors
HW: There was one, but as I have often repeated, it was nipped in the bud with the misguided US Iraqi adventure. In the meantime, this fact has yet to be built into the market. Once that happens, then perhaps, a more lasting recovery may begin.

5. No Reason for Nasdaq Exuberance
“Things are better in tech stocks--but not THAT much better.”

Best Winners Often Show Higher P-Es Than The Market
HW: Especially true when the market is on drugs, which is most of the time.  Of course, one is also forced to sleep with one eye open, if you are not likewise on drugs.

6. READER: Are trade deficits bad?  Why?  Show me ONE developed country that doesn't have a huge trade deficit...The U.S. trade deficit is 5.2% of GDP...similar to Australia...Remember also that China does not float their currency, so the falling dollar doesn't ease the trade deficit the way it Should...eventually China will have to float their currency, as Treasury Secretary Snow has advocated, or China could end up like Argentina...in currency collapse.
HW: I just hope the US doesn’t end up like Argentina. Yes, trade deficits are bad, especially when 5% or more of GDP.  It will be interesting to see how you feel about this issue same time, next year.

READER: Do you think we could be headed into a depression re: corporate debt?
HW: Unfortunately, the intermediate term future for the US economy is increasingly like political solutions for Iraq, there are ever decreasing positions options.  We are most wary of corporate junk, but hold some A quality.

READER: In your 9.12 broadcast you spoke about how investing in microcaps benefits the market.
HW: I said in the frothy end part of a market cycle such as we have now, or had in late 1999 and early 2000, investing in microcaps is highly profitable using only a portion of profits earned earlier in the cycle, assuming one is using prudent money management.

READER: You wrote in last week's WSNW that you were waiting for gold to test $380.  What do you think of the test so far?
HW: Not Complete, BUT sufficient enough to go long gold over the weekend to 390-392, where we are likely to resell.

7. HERE WE TALK ABOUT AFUND CLIENTS:

READER: I remember you saying in your last radio show that OSGL may go to $.90 and then drop back to $.50 and then within 2 years go to $5 - Most interesting prediction.
HW: Being a Leo, I find all my predictions interesting! ;)

READER: I have read the re done accounts re Canadian Exchange and think it borders on pathetic the storm the Exchange have inflicted [on IHI]. Same results for the bottom line and the former way of accounts being done would in my opinion be more exact re non refundable.
HW: Almost everyone I have spoken to agrees.

READER: I was JUST wondering how you marketed the company [IHI] to potential investors, e.g. Amex Club.
One would think you would have to present information that would be current and show IHI is actively producing, or had contracts, or something, to convince people to invest now.
HW: I simply present the company fundamentals and then offer my assessment of its potential. I point out the stock is basically dry and should have good news come over the next month or two. It can easily double, triple or more.

READER: Where are the [IHI] orders? 
HW: The Company has yet to announce this in a press release.  There are many potential orders that could be closed soon. I both hope and expect some of these to be announced shortly.
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PAST WALL STREET NEXT WEEK REPORTS
              FRIDAY 11 am listen to our Internet radio program TRADING BY THE  STARS.
(c) 2003 All rights  reserved.  The Astrologers Fund  "Always a Stellar Performance"
wsnw@Afund.com 212/949-7211 Fax 212/949-7274 370 Lexington Avenue, Suite 416 New York, N.Y. 10017-6503
Author: INVESTING BY THE STARS, THE STUDY OF ASTROLOGY,TRADING BY THE STARS (01)
May 14-17, 2004 Eleventh Astrology & Stock MarketConference   NYC
DISCLAIMER
: PAST RESULTS ARE NOT NECESSARILY INDICATIVE  OF  FUTURE FORECASTING ACCURACY OR PROFITABLE  TRADING  RESULTS.

INVESTORS ARE REMINDED TO PERFORM THEIR OWN DUE DILIGENCE BEFORE MAKING ANY INVESTMENT DECISION. ALWAYS INDEPENDENLY INVESTIGATE AND FULLY UNDERSTAND ALL RISK EFORE MAKING ANY INVESTMENT.
The Astrologers Fund Inc. Accepts No Liability Whatsoever   For Any Loss Arising  From Any Use  Of   Its Report Or It's Contents. The AstrologersFund Inc. Or Its Clients Usually  Holds Positions In The Stocks and/or MarketInstruments Mentioned And May Buy Or Sell At  Any Time Without Notice depending on market conditions and personal  financial conditions.   This InformationIs  In No Way A Representation To Buy Or Sell Securities,  Bonds,  Options Or  Futures. This information  is not intended to be used as the sole basis of  any investment decisions,  nor  should it be construedas advice designed to meet the investment needs of  any particular  investor.
ALWAYS CHECK WITH YOUR LICENSED  FINANCIAL PLANNER OR  BROKER  BEFORE BUYING OR SELLING ON THE RECOMMENDATIONS  OF  THE ASTROLOGERS FUND  Inc.

IHI has been an AFUND client since 1994 and is currently paying monthly $2,500 consulting fees and $500 for banner ads on our website. May 15, 2002, an affiliated company, Susan Hahn & Associates became IHI’s media representative with a monthly fee of $1500.
July 7, 2003 GYR-TSX became an AFUND client and is currently paying $1000 monthly consulting fees plus we received a one time fee of 100,000 free trading shares and will receive 200,000 options at C$.10 to be paid by a third party.
August 19, 2003 OSGL became an AFUND client and is currently paying $1500 monthly consulting fees plus we will receive a one time fee of 168,000 free trading shares and 200,000 options at $.25 to be paid by a third party.
Please read our Disclaimer for more information and note that my clients and I are shareholders and may act in the open market.
          
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