Friday, March 5, 2010

Currency strength

A natal horoscope for a country can be read to reveal its future trends and events. It can also be read in comparison with the horoscope of another nation to reveal the relative currency strength of the two countries, the exchange rate.

In this article, the inherent strength of the UK Pound Sterling and the US dollar is read from the respective national charts. The strength of the currency indications in the respective horoscopes is then compared and contrasted, the long term trend noted and a prediction made.

Exchange rates
To many, the concept of an exchange rate is not so easy to understand. This is understandable as it tends to become a complicated matter in daily usage. However, some may find the following explanation helpful, while others may skip it and proceed to the next section. The exchange rate is the price of one currency in terms of another. In other words, it tells us how many units of a national currency are required in exchange for one unit of another currency. If a national currency is strong, it means the people of that country don't have to give up as much of it to obtain other currencies. The opposite would be the case if the national currency is weak. With a strong currency one obtains goods abroad at lower prices. However, the downside is that foreigners do not find the prices of our goods as favourable to buy. In other words, the pricier a currency is, the less well the country would tend to do in balancing its foreign trade, as it would tend to import more than it exports. Fortunately, price is not the only consideration as people also look to their income to decide if they want to spend to obtain a foreign good or service. Over a long time, the exchange rates may show clear trends, either up or down, depending on if one country is more dynamic than another or has some critical advantages influencing money flows. Another thing that may add to the confusion of understanding exchange rates is that their values change quite a bit over time. This is because currencies are traded continuously and the value depends on how many people want to either sell or buy the currencies at any given time and for how much. Moreover, people and companies trade currencies for different reasons. Many do so because they intend to buy foreign goods while others do so because they are aiming to reduce the risk of their international commercial dealings or speculating in the hope of earning a profit. Invariably, the gain of one person is another's loss. Interestingly, the flow in and out of currencies any given day is very large and most of it is for financial reasons and only a fraction to finance merchandise trade. In this regard, we can note that investors may place their money in a foreign country if they have confidence that the investment will return a profit. Countries with stronger currencies tend to benefit by sustained foreign inflows of capital (large sums of money) and tend to pay lower interest rates on such monies (loans or investments) than countries with less currency strength. To this we may add that when participants on global financial markets become worried about their investments, major moves can take place, with capital rushing out of one country and into another, with currency values then in wild swings. Normally, investors flee out of weaker currencies and into safe-haven currencies (noted for their strength or resilience) during difficult times. This quality may also depend on the size of the currency area and its liqudity, the ease with which one can sell a currency without affecting its price on the market.

Astrology of exchange rates
Astrologer & author V. K. Choudhry gave the following definition of currency strength on the SAMVA list on September 26, 2000, prompted by my question:

“It is the power of the state which is shown through the strength of the currency. The authority is first vested in the Sun and then in the Moon. The good financial strength of the nation/wealth is seen through the second house and the regular flow of income is seen through the eleventh house. Taken all these four together they show the real strength of the currency of a particular country.”

Currency strength of a nation thus depends on the integrity of and trust in a state (Sun), the government and the policies it may implement (Moon) as well as the income and wealth of the country. The power of the state may be linked to the size and endowments of the state and its track record in defending its interests in the past. The policies may either help or hinder the wealth generating potential of the economy, including the operation of markets. Markets may be given an excessively free rein or be constrained to the point that they do not yield the optimal outcome. The laws of the country set the rules of the game that either help to resolve ambiguities of what is fair for investors and consumers or they may be unclear and/or biased, such that they favour either seller or buyer at the expense of the other. It is a complex matter. That said, we can look to the natal potential of a horoscope to see the bottom line, in terms of the expected long term trend of currency strength. Over shorter time spans, the astrological analysis of the external value of a currency are linked to the changes between the major or sub-periods of the planets and significant events indicated by transits, which bring either advances or setbacks.

Horoscope of the UK
The horoscope of the United Kingdom has 16° Virgo rising with 2nd lord Venus well placed at 25° 27' Capricorn and the 5th house under. Venus is well placed in the 4th house of the Navamsa (D-IX) chart, supporting the strength of Venus in the natal (Rasi or D-I) chart. Venus is also well placed in the sign Leo in the Hora (D-II) chart. A planet in the sign Leo in the Hora chart becomes affluent. Venus is thus in good strength in the chart. It is, however, receiving an aspect from functional malefic Ketu at 22° 59' Virgo and 1st house, which could bring sudden adverse developments, but as the aspect has an orb of 2° 28' it is not strongly felt. In other words, the wealth of the British tends to be linked to their creativity and speculation. Not surprisingly, London is one of the major finance capitals of the world. The Moon becomes 11th lord of income and it is well placed at 28° 20' Gemini and the 10th house. The income is therefore strongly linked to foreign trade and the laws, but also the government, as Moon is the general indicator of the cabinet. As such, the Moon becomes a dual indicator of currency strength. In Navamsa chart, Moon is in 2nd house and in Hora chart it is in Cancer, its own sign. As the Moon is in old age in the Rasi chart, however, its overall strength is considerably reduced. Moreover, 12th lord Sun aspects the 10th house, indicating foreign developments and losses reduce the currency strength. The Ekadasmsa (D-XI) chart of income also comes with problems, including Moon as 5th lord of speculation conjunct Saturn as 12th lord of losses in the 5th house. This may further harm the Moon's general indications in the Rasi chart. The final indicator of currency strength, the Sun, at 19° 00' Sagittarius, is in the most effective point (MEP) of the 4th house. As such, the Sun also aspects its own house of placement, reducing its own strength. It is however well placed in the 5th house of Navamsa chart but in Cancer in the Hora chart. The authority of the state is not as helpful as it could be. Lastly, the planet Mars, as 8th lord of obstacles and endings, is at 20° 40' Aries and 8th house, where it is aspecting both the 11th house of income and 2nd house of wealth, as well as the 3rd house of enterprise, this is unhelpful to currency strength. The orb however is wide, reducing the significance. Nevertheless, as the UK chart is running the Mars major period from 2006-2012, this would not be seen to be helpful to the value of the pound during that period, especially during the Saturn sub-period from May 2008 to June 2009, when the pound suffered a sharp drop. Overall, we get a mixed picture with the 2nd lord clearly the most helpful to currency strength whereas the Moon and Sun, while well placed, have their strength compromised.

Horoscope of the USA
In the SAMVA USA chart the indications of currency strength are in a class by themselves. The Sun becomes both 2nd lord and general indicator of currency strength in this chart. It is strong at 23° 44' Capricorn and in the MEP of the 7th house, thus also favourably aspecting the 1st house of self. While the Sun is placed in the sign Leo and 8th house of the Navamsa chart where it is conjunct 12th lord Jupiter, which reduces the strength at bit, it is in the sign Leo of the Hora chart, which boosts the strength. The 8th lord Saturn at 26° 46' Scorpio and 5th house aspects the Sun. However, the aspect is over 3° orb and the Sun is not influenced to a significant extent. Overall, the wealth generating potential and authority of the state is significantly good and involves foreign policy (7th house) and contributes to a healthy self-image (1st house). As Taurus, a non-Moolatrikona sign, is in the 11th house there is no 11th lord and this house is not afflicted, suggesting income would not be a major problem for the USA. Moreover, the Ekadasamsa (D-XI) chart of income is generally ok, although not perfect. Importantly, the other general indicator of currency strength, the Moon as 1st lord, is exalted at 7° 19' Taurus and well placed in the 11th house. This suggests that economic policies are geared to being income generating. The Moon is well placed in the 3rd house of initiative of the Navamsa chart, conjunct Saturn as 2nd lord of wealth and FM Ketu of sudden setbacks. American's tend to be entrepreneurial and wealth seeking, but the history shows volatility in this regard. In the Hora chart the Moon is placed in the sign Cancer. Moreover, in the Rasi chart, it receives two aspects, one from 6th lord Jupiter at 4° 25' Scorpio and 5th house and 10th lord Mars at 10° 07' Scorpio. The former aspect is not close enough to have a material negative effect and the influence of Mars is only helpful. The USA has been running the inauspicious period of Venus since 1996. This period has been associated with a bubble inflating and then bursting in the US housing market, followed by a banking crisis. An overall assessment is of great currency strength, consistent with the US dollar being a safe-haven currency in the world.

Long term exchange rate
We can now compare and contrast the evolution of the long term value of the UK Pound Sterling and the US dollar in terms of an analysis of their respective horoscopes. The accompanying chart shows the long term trend. The value of the UK Pound has fallen in a rather steady manner for almost one century with respect to the US dollar. This is not surprising as the USA has been in ascendancy in this period while the Sun has set on the British empire. After World War II, the international order of the British Empire, referred to as the Pax Brittannica, was replaced by the USA assuming the mantle in what became known as the Pax Americana.
Recent and future developments
Following the collapse of the Bretton Woods system in the early 1970s, the dollar has continued to gain on the Pound. While there has been volatility, reflecting the period and transit influences in both charts, the trend line has clearly been lower, such that those buying a pound with dollars now pay less than they did some forty years ago. Moreover, while there have been concerns about the long term viability of the dollar, given the debt of the US government and during the recent adverse planetary periods, it is expected that when the Sun major period rolls around in 2016, the integrity of the US dollar will be boosted. In the interim period, given the even more adverse major period of Mars in the UK horoscope until 2012, the UK pound may experience a further trend decline relative to the US dollar.

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