Iceland - the big picture view

March 20, 2008

Dear friends,

The situation in the foreign exchange market and in the stock market in Iceland worsened yesterday. The developments are seen crystal clear in the 9° 30' Virgo rising chart for Iceland.

While the impact on the currency (the ISK) is largely explained by the affliction of natal and transit 12th lord Sun in recent days, as enumerated in earlier posts, there is also a bigger picture story to tell about 6th lord Saturn as major period lord.

The Saturn major period has been operating since January 1, 2005 and will run its course in January 2024. Issues related to Saturn, as per the natal influences, will therefore be felt for a long time to come. The Saturn sub-period ran until January 2008, when the more favourable sub-period of 1st lord Mercury began. This is a helpful change. However, the transits remain difficult in early 2008.

We may note that transit Saturn entered Leo and the 12th house in July 2007, with ramifications for the Icelandic financial market. In August and September 2007 it was also under its own natal aspect. It is presently conjunct the most effective point of the 12th house and will remain in the MEP until July 2007. The transit of Saturn through the sign of Leo ends in October 2009. During this transit, the passage of Saturn through the MEP will be the most difficult part. So, it is important to analyse its natal influences, to understand its impact.

The natal influences of Saturn are important for the overall story during this time. Saturn as 6th lord of financial stability is natally conjunct the Sun as 12th lord and the most effective point of the 10th house. This means that conflict and excessive debt have the potential to create losses for the country. Certainly, the worsening financial conditions in Iceland may be traced to Saturns entry into the sign of Leo and the 12th house in July 2007. The stock market peaked in July and has been on a tear down since. It is now half its July 2007 value! As Saturn is natally conjunct the most effective point in the 10th house it also aspects the 12th house of losses, 4th house of communal harmony and the 7th house of foreign relations. All these issues are likely to be affected by differences of oppinon or concerns over debt management during its

period.

The issues having to do with conflict, financial stability and health became important in the period of Saturn. The first "financial crisis" erupted in early 2006. The second one began in late 2007 when the deepening "correction" could not be termed anything but a "slump". At that time, funding became more difficult for the banks and households. The crisis however erupted in full force more recently, with the local currency, the ISK, dropping the most since it was floated on the FX market in 2001 and stocks have reached a rock bottom (it seems on the stock exchange).

In early 2006 the initial crisis broke out when all the functional malefic planets ganged upon the most effective points of various houses. It was a dramatic episode. However, as soon as the FM planets stopped afflicting so widely the situation eased and business as usual returned. Presently, the transits are very difficult and the situation is expected to ease once the transit afflictions lift.

Interestingly, while Iceland is a small country (around 300.000 inhabitants) these issues have become quite well publicised internationally being written about in the major financial papers and covered on major tv networks. This is linked the natal conjunction of Saturn and Sun in the 10th house. The 10th house and the Sun also involve the government and indeed the government is placed in the spotlight at such times. This placement involving the 6th lord aspecting the 4th house also arouses strong or divisive feelings in the population. The situation became aggravated when transit Saturn became conjunct the most effective point of the house, aspecting also the 2nd house of wealth (linked to the banks) and the 9th house of luck, reducing the strength of natal Mercury in the 6th house, which acts as a basic support in the chart. This last point is important to keep in mind as the Mercury

sub-period is operating during the present Saturn major period.

Importantly, the drop in the currency, the ISK, is linked to the affliction of stationary transit Rahu in the 6th house to the natal Sun. This aspect becomes exact toward the end of this month, when also the nodes end their stationary period at around 3° 45' Aquarius and Leo, respectively. The adverse influence on the ISK was increased in recent days when transit Sun moved into Pisces and into the aspect of natal Rahu at 5° Cancer in recent days. Once these transit afflictions clear, the pressures should die down on the currency.

However, as transit Rahu will then begin to closely aspect natal 2nd lord Venus at 0° Gemini, the concerns about the wealth will likely continue until May 2008.

The nodes move into Capricorn and Cancer, respectively, on May 6, 2008. There they will become conjunct 4th lord Jupiter at 30° Cancer. This aspect suggests problems for the social harmony or fixed assets at that time.

With Mercury and Venus transiting the 6th house, where they are weak, they also became inflamed by this issue over financial stability. As Mercury and Venus become strong in transit and these afflictions clear, the situation is predicted to become easier again. Interestingly, the two recent financial crisis episodes have taken place in the first part of the year. This is fitting a Virgo ascendant, but this is the time when the Sun transits the 6th,7th and 8th houses, with Mercury and Venus in tow. The first third (or four months) of the year is normally more challenging for Virgos.

In sum, the Icelandic Republic chart perfectly explains these developments.

However, we should also not forget that at the root of these difficulties is the more adverse funding situation abroad due to enormous loan losses in the USA and financial stability concerns there (as explained by the SAMVA USA chart). This situation exposed the vulnerability associated with the rapid growth of the Icelandic banks abroad in recent years. They became very dependent on funding on the international financial market. At the same time, it seemed everyone closed their doors at the same time and the banks were cut off. This situation seems now to have changed for the worse, suggesting the banks will have to soldier on with a change in their business model. However, the default should not be expected as they have remained very profitable and are now likely to retrench to preserve the profitability through limited asset sales and rationalisation in staffing levels. That said,

the days of very easy credit in Iceland are over for now. We will see how things develop in the second half of the year, when the transit affliction eases, but Saturn continues its transit through the 12th house. Likely, Iceland will pass out of the spotlight, but things will remain difficult.

Best wishes,

Thor

Cosmologer <cosmologersamva Sent: Monday, March 17, 2008 4:20:45 PM Iceland - financial market volatility at maximum

Dear friends,

The panic in global markets is affecting countries large and small. As we have an authentic chart for Iceland it is interesting to examine the developments in terms of this chart. First, the local currency the ISK has dropped over 6% today, while the stock exchange has dropped 4% and it is now half of the 9000+ level achieved in mid 2007.

These developments are seen clearly in the 9° 30' Virgo rising SAMVA Iceland chart:

Saturn - Mercury period is operating

Natal 1st lord Mercury is well placed and strong at 17° Taurus and 9th house. The aspect of Ketu at 5° Capricorn to the 9th house from the 5th house does not weaken Mercury.

Transit Mercury at 9° Aquarius in the 6th house is now exactly opposite transit 6th lord Saturn at 9° Leo in the 12th house. Transit 2nd lord Venus at 11° Aquarius is also afflicted.

Transit Saturn is also afflicting the 9th house closely thus doubly disturbing Mercury as well as the 2nd house and thus doubly afflicting the lord of wealth and the currency.

Transit 8th lord Mars at 10° Gemini is afflicting the 10th house, 1st (and thus Mercury), the 4th and 5th houses - and thus aggravating Ketu and its aspect to the 9th house - as well as the 11th house, where Mars is natally placed (and debilitated).

Transit 12th lord Sun at 3° Pisces and 7th house is also in an applying aspect from natal Saturn in the 10th house. The disturbance to the ISK is coming from the conditions abroad. Natal Rahu at 5° Cancer and 11th house is also aspecting the Sun, further weakening the currency. Add to this that transit stationary Rahu in the 6th house is exactly afflicting natal Sun and the impact on the currency is absolutely maximum.

The redeeming factor is transit 4th lord Jupiter at 24° Sagittarius and 4th house is aspecting the natal 11th lord Moon at 24° Aries in the 8th house. The ISK would be a lot worse off if this aspect wasn't in place.

The above should convince even the most sceptical of the merits of SA astrology in the mundane sphere.

Best wishes,

Thor

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March 23, 2008

Dear friends,

The Sunday Telegraph has today published the attached article which suggests the financial system and economy of Iceland is in deep trouble. Saturn-Mercury period is operating in the chart until September 2010. As Mercury is very well placed and strong in the 9th house (a Sun-like house), the luck should keep things manageable while transit Saturn passes through the sign Leo and 12th house (until September 2009). The passage of the transit nodes out of the 12th and 6th houses in May 2008 should also be helpful.

Best wishes,

Thor

Iceland shows cracks as the krona crashesBy Louise Armitstead

Last Updated: 1:16am GMT 23/03/2008

While financial stocks were being battered on both sides of the Atlantic Ocean, in between one goverment was scrambling to prevent a meltdown of an entire economy.

The financial crisis in full News and analysis from the banking sector Analysis: HBOS pulled back from the brink

The rollercoaster week: Click to enlarge

Iceland, which has boomed on the back of exponential growth in its banking sector, is now suffering in the clutches of the credit crunch.

One commentator said: "Iceland is being treated like one big toxic hedge fund. It's a tiny country whose corporate and banking sectors have leveraged up to get better returns and punch way above their weight. That leverage is now magnifying their losses. The story doesn't make sense any more. Nobody wants anything to do with it."

In recent weeks the Icelandic kroner has plummeted in value, the banks have had millions of dollars wiped off their stock and lending lines from both American and European banks have been savagely curtailed. As with HBOS, Kaupthing, Iceland's biggest bank, has been besieged by rumours that it could be nationalised, although the government and management deny any liquidity issues. Even so, traders in credit default swaps (CDS) have pushed the cost of protecting the country's three main banks' debt against default to stratospheric levels, leaving the banks facing prohibitively high funding costs.

It is not just Iceland's problem. In recent years the country's burgeoning lending arms have bankrolled investments in a raft of British companies. One of Kaupthing's best known clients is Robert Tchenguiz, the Iranian-born investor, who owns large chunks of J?Sainsbury, Mitchells & Butler, SCi Entertainment and Somerfield. The investments, all funded by the Icelandic bank, have plummeted over the past year. It is thought that Tchenguiz, who lost a paper fortune of nearly $1bn when the Qatari-backed investment vehicle, Delta Two, walked away from Sainsbury, is just one of about 15 top clients under pressure that are weighing heavily on the bank.Landsbanki, the second largest bank, owns Icesave, one of the fastest growing online savings banks. By offering one of the highest interest rates on offer, Icesave has attracted £5bn of retail savings and 150,000 customers in 18 months.

Meanwhile Baugur, the Icelandic investment company, owns high street names including Hamleys, House of Fraser, Karen Millen, Oasis and Iceland, the budget supermarket chain.

There are concerns that these investments could be vulnerable if Iceland's banks are put under any more strain.

Iceland's prime minister, Geir Haarde, has tried to reverse the negative sentiment. He said: "The CDS spreads are totally out of line and not justified given the fundamental situation of the banks."

But his pleas have fallen on deaf ears.

In recent days Moody's Investor Services, the ratings agency, downgraded the financial strength ratings of the top three banks - Kaupthing, Lansbanki and Glitnir - over concerns about their asset quality following years of rapid growth. Last week, the Icelandic krona touched a record low against the euro, tumbling another 6.2 per cent with one euro worth IKr127.96. It has fallen almost 25 per cent this year and 17.2 per cent this month.

One trader said: "The currency is in free flow. The banks are under serious pressure and sometime they're going to have to take a hit. We might all be wrong but this could cause fireworks."

Cosmologer <cosmologerSAMVA Sent: Thursday, March 20, 2008 9:37:26 AMRe: Iceland - the big picture view