LUNAR PHASE & THE PANIC OF 2008

David McMinn 

Moon Sun Finance

The continuing crisis in the US credit markets finally spilled over into major stock marker panics around the world. The key date for Europe was Monday January 21, 2008 when the FTSE fell -4.76%, Dax -7.16% and CAC -6.83%. Unfortunately, it was the Martin Luther Day holiday and the markets were closed in the USA. The US Federal Reserve slashed a key interest rate by 0.75% the following day and the DJIA fell by only about one percent. This paper looks at the timing of the January 21 event in relation to lunar phase and other Moon Sun factors.

Please note: The annual one day (AOD) movements were the biggest one day % rise or fall in the Dow Jones Industrial Average (DJIA) in the year beginning March 1. Major AOD rises and falls were found to be highly significant in relation to lunar phase and the ecliptical positions of the Moon and Sun (McMinn, 2006). The index used was the Dow Jones Industrial Average (DJIA), which has been timed at noon EST for the positions of the Moon and Sun. Ecliptical degrees has been abbreviated to E^o, while angular degrees between the Moon and Sun (lunar phase) is given as A^o. A glossary has been included for those not familiar with the terms used in this paper.

DJIA AOD Falls

All major AOD falls for the period December 15 to February 28 have been listed in Table 1. The 6 events had lunar phase between 050 and 200 A^o, with 5 events between 120 and 170 A^o. The AOD falls occurring when the Sun is 180^o opposite in the ecliptical circle (ie: between June 15 and August 30) have also been included in Table 1. There was a strong propensity for lunar phase to be observed in a narrow range, with 10 days having angles between 120 & 185 A^o, compared with the 2.5 that could have been expected by chance. Similarly, the Moon was located from 070 to 110 E^o (near the 90 E summer solstice point) on the ecliptical circle for winter AOD falls - one exception in 1895. Additionally, the Moon was located from 230 to 280 E^o (near the 270 E winter sostice point) for the summer AOD falls - two exceptions in 1933 and 1934.

Intriguingly, the January 21, 2008 panic was the first time a major US panic occurred between November 1 and March 20 since 1928. This was most unusual and may indicate a break with past cycles, but that remains to be seen. Prior to 1928, AOD falls quite regularly happened around during summer, particularly in the 1890's. 

Moon Sun Intervals

The Moon Sun intervals between the January 21, 2008 AOD fall and other similar winter/summer falls in financial history is given in Appendix 1. There is no obvious eclipse cycles could be established between these events. In contrast, numerous eclipse cycles could be confirmed for intervals between October panics (McMinn, 2006). The best alignment arose between the AOD fall on January 20, 1913 and the January 21, 2008 event.  It was exactly 95.00 tropical years and 1175.02 synodic months, an interval that could not be linked to any eclipse cycles found in the relevant literature.

Intervals of 123 and 124 synodic months were extremely important  between the various highs, lows and panics of 1987 and 1997 (Repeating Intervals: 1987 - 1997 & 1997 - 2007).

Intervals of 123 and 124 lunar months were very important  during the 1987 and 1997 panics. The 123 lunar month interval also appeared between the October 27, 1997 panic & October 9, 2007 record high for the Dow Jones Industrial Average (DJIA). It was also apparent between the summer highs in 1987 - 1997 and 1997 - 2007.

Lunar phase for the record peaks, the panics and the recoveries were all between  320 and 040 A^o - around the new Moon. The post crash lows happened a few days before the full Moon at 173 A^o for 1987 and 155 A^o for 1997 - approximately 180^o opposite in the angular circle. 

The record high of October 09, 2007 and January 21, 2008 panic had the Moon around the new Moon and before the full Moon respectively. Why the emphasis on the new Moon and a few days before the full Moon for the crashes of 1987, 1997 and 2008 remains completely unknown, like most factors in Moon Sun financial cycles.

Why it can be necessary to add/subtract additional small integral and half integral numbers to established eclipse cycles remains unknown, but it was necessary to given the correct timing of a panic - a finding that has been supported from financial history. 

*   The interval between the 1929 and 1987 record highs, October highs, the panics and AOD rises was 717 synodic months. This was equivalent to a Double Inex cycle (716) plus one synodic month.
*   The interval between the US black days in 1873 and 1929 equaled One 56 Year Cycle (692.5) plus 1.5 synodic months.
*    The interval between the major US October panics in 1857 and 1929 was four Saros cycles (4 x 223) minus one synodic month.
Many other examples have been presented by McMinn (2006).

I thought that the panic would occur around October 8 and 24 assuming that it would be equal to 123 months plus small numbers of integral and half integral numbers of synodic months. What I did not foresee was that the panic would take place at 123 + 3.5 synodic months and in January. As mentioned previously, this was extremely unusual as there have been no major US panics in the months November 1 to March 20 since 1928. Just goes to show that you can never take historical  cycles too seriously. Cycles change over very long time frames and in a manner that is unpredictable. 

There are also interesting parallels between the 1930's and 2000's, with the US stock market has been broadly repeating the similar pattern. Interestingly, the September 3, 1929 & March 10, 1937 DJIA highs were separated by 2745 days, while the comparable interval was 2743 days between the January 14, 2000 & July 19, 2007 DJIA highs. No Moon Sun cycles could be linked with this interval.
 

Additionally, the interval between the July 8, 1932 low and the October 18, 1937 panic was 1928 days, which aligned closely at 1930 days between the October 9, 2002 low and the January 21, 2008 panic. 

The bear market lows in 1932 and 2002 had similar lunar phase – a few days after a new Moon.

The January 21, 2008 panic had the same lunar phase as the September - October AOD falls of 1931, 1937 and 1989 - a few days prior to the full Moon.
 

Conclusions

For AOD falls in the Summer and Winter seasons were most likely to have lunar phase from 120 to 185 A^o, with the Moon located near the summer and winter solstices. Why this effect arises is unknown, but presumably it is based on Moon Sun tidal resonance. The ability to predict future market trends lies in Moon Sun cycles, but how the tidal effects function in financial activity remains a great unknown. General movements can be indicated from cycles, but that is all. Precise Moon Sun forecasts will only be achieved though major breakthroughs  in our understanding of such phenomena.

(c) Copyright. David McMinn. All rights reserved.

Reference

McMinn, David. Market Timing by The Moon & The Sun. Twin Palms Publishing. 2006.