Businessweek Archives

When Scorpio Rises, Stocks Will Fall


Finance

WHEN SCORPIO RISES, STOCKS WILL FALL

Jack Shuman, futures trader, is ready to "come out of the closet." After considerable soul-searching, he has decided to reveal an aspect ofhis life that is shared by untold num-bers of other Wall Streeters. Most fear repercussions--ridicule, or even loss of their jobs--were their secret passion ever to become known. But consequences be damned. Jack Shuman is going public. "You can call me a futures trader and researcher," he says. "And an astrologer."

For better or worse--probably the latter--this is the dawning of the Age of Financial Astrology. At a time when the market has rarely seemed more unfathomable, astrology is gaining popularity as a forecasting tool, one with special appeal to those anticipating an imminent financial Doomsday.

APOCALYPSE SHORTLY. Some trappings of respectability have already arrived. There is a widely read market-astrology newsletter, Crawford Perspectives, edited by the veteran market technician and astrologer Arch Crawford, and even an Astrologer's Fund. In mid-May, about 50 financial astrology buffs gathered in New York for a conference organized by Henry Weingarten, the fund's manager.

Weingarten claims to run some $8.7 million in the fund, which is a private investment vehicle for what he describes as "high net-worth individuals." The fortysomething, bearded Weingarten has been an astrologer for 25 years and runs the fund from offices on Manhattan's Eighth Avenue, in a building that includes the Canine Human Rights League and overlooks a strip of garment-notion manufacturers and salvaged-goods outlets. "I go outside on the street, and I can see that we're heading toward a depression," he says. "All the big brokers are living in a dream world."

That's right, a depression. Astrologers are among the most pessimistic of market watchers, and Weingarten is downright apocalyptic. The reason? Look up--way up--to Uranus and Neptune. The two planets have lined up, and that is positively lousy, astrology-wise, for perhaps another two years.

Weingarten doesn't base his forecasts solely on the Uranus-Neptune situation. He also designs individual astrological charts of the stock market, based on the positioning of the heavenly bodies at the founding of the New York Stock Exchange, as well as similar charts forthe Tokyo exchange, President Clinton, individual stocks, and the U. S. itself. The prognosis is dour. Weingarten is "short everything" except some gold stocks. "We are not in control of our own destiny," says Weingarten. "This is a period in which the unthinkable becomes thinkable."

SUNSPOTS AND SELL-OFFS. Crawford agrees that the planetary situation is crummy indeed for the markets. Some crucial days ahead, according to the latest Crawford Perspectives, include June 10 ("Saturn stationary retrograde square to solar eclipse . . . may touch off tight money. Restrictions. Depressive feelings. DOWN!") and June 24, when the position of Mars portends "bank failures, sharp market sell-off, tight money, currency crises, earthquakes, sunspots!"

Does financial astrology make sense, or is it--pardon the expression--moonshine? So far this year, both Crawford's and Weingarten's gloomy prognostications have yet to bear fruit. But Crawford fared better in 1992, when his newsletter was rated No. 1 long-term market timer by the market newsletter Timer Digest. As for Weingarten, he won't provide performance figures for his fund. And not all participants in the May conference were necessarily sold on astrology. The skeptics include conference speaker Jack D. Schwager, director of futures research and trading strategy at Prudential Securities Inc. If market cycles are in sync with planetary cycles, he notes, that's probably a coincidence. Says conference attendee Peter Corey, a currency trader at Midland Bank PLC: "There's no way I could put my firm's money at risk on the basis of financial astrology."

Shuman has no such qualms. He is, he says, "hiring sophisticated quant people" to provide number-crunching for his trading methodology, which uses a combination of orthodox technical analysis and a "Hindu forecasting technique." But Shuman has already taken an even bigger step--he has come out of the closet. Most of his ilk on Wall Street have not. For their sake, if not their clients', perhaps that's just as well.Gary Weiss in New York


Best LBO Ever
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus