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In the Liberty Bonds section, Gann asks why securities of an issuer he regards as sound could fall in price. His explanation centers on holders who needed cash and sold their bonds during a depression. The mechanism separates confidence in promised payments from the price obtainable when an owner must sell now. Use an explicitly synthetic bond to isolate the distinction. A holder pays $100 for a claim with $100 principal due at maturity. Before maturity, the available resale price falls to $92. If the holder sells then, the principal-price loss is $8, regardless of whether the issuer ultimately pays the promised $100 to the new owner. A promise about maturity is not a promise about every intermediate market quote. Keep issuer payment risk, market-price risk, and the holder's cash deadline in separate columns. A need for cash can force the second risk to matter long before the first question is resolved. Gann's historical explanation is a reminder to examine the sellers' circumstances, not proof that every bond decline comes from forced sales. This approach also prevents the word safe from silently switching between credit safety and price stability.

Try it

Synthetic bond: purchase price $100, current resale bid $92, promised maturity principal $100. Does the $8 price decline alone prove issuer default? What principal-price loss results from selling now?

Limits

Gann’s account is one historical explanation, not a complete bond-pricing model. Interest rates, credit expectations, maturity, coupons, and liquidity can all matter; repayment itself is not assumed certain.

Source

W. D. Gann, Truth of the Stock Tape (1923), Book III, Chapter XXVI, How to Watch Investments, Liberty Bonds, printed p. 148. Primary source: Internet Archive scan of the original printed book; passage cross-checked against archived OCR and local Gann Study Group transcription. Synthetic examples and modern calculations are editorial, not historical Gann trades.

In the manuscript of Are Investors Moonstruck? Lunar Phases and Stock Returns, Kathy Yuan, Lu Zheng, and Qiaoqiao Zhu examine 48 countries from January 1973 to July 2001 and report annualized return differences of 3 to 5 percent between full-Moon and new-Moon windows in two global portfolios. Those are the authors' historical sample results, not a forecast and not a return per lunation. The most instructive detail is the structure of the experiment. Lunar phase is defined by the Moon's ecliptic longitude relative to the Sun, so a full Moon is one shared event for every country, not a separate treatment drawn 48 times. Local sessions differ, but the clock is common. Here is a deliberately artificial demonstration of what that means. Copy one eight-day return series into 48 country columns and average them. The average equals the original series and its variation has not shrunk at all, whereas an independence assumption would divide the standard deviation by the square root of 48. Copies contain no new information. The paper handles this with panel-corrected standard errors that allow contemporaneous correlation across countries. That is the reading lesson: counting countries is not the same as counting independent evidence. The causal bridge from phase to mood to returns remains unproved, and the authors say the relation could be spurious.

Try it

Put the synthetic returns 0.01, -0.02, 0.03, -0.01, 0.02, -0.03, 0.015, -0.005 in one spreadsheet column and duplicate it 48 times. Compare the standard deviation of the daily average with the original. Compute what independence would predict and explain why that is wrong for exact copies.

Limits

The manuscript was read but its data were not acquired or re-estimated, and no post-2001 persistence is established. The synthetic example is not the paper's result. The study does not validate zodiac, aspect, or planetary-sector claims or establish mood as the cause.

Source

Yuan, Zheng, and Zhu, Are Investors Moonstruck? Lunar Phases and Stock Returns (manuscript), Abstract; section 3, Data; panel-corrected standard error discussion on manuscript page 4. Empirical finance scholarship read from the author-hosted manuscript; USNO defines lunar phase by ecliptic longitude difference.