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07 September 2017

Fortune sellers 

If there’s one sector that’s recession-proof, it’s clairvoyance.

Especially during periods of economic uncertainty, vast numbers of people turn to divination for answers to unanswerable questions. At the peak of Europe’s recent recession, for example, Italians spent more than €5.5 billion annually on clairvoyants and fortune-tellers – shelling out between €20-600 a day for mystical financial advice.

According to Pew Research, one American in seven has been to see a fortune-teller. In France, one in four regularly reads their horoscope, while the country’s 100,000 fortune-tellers receive 15 million visits every year. In total, the French clairvoyance market is worth some €3 billion annually.

The first newspaper horoscope was published 80 years ago, proving a financial godsend.

“Horoscopes,” according to Jonathan Cainer, the late Daily Mail astrologer, “turned out to sell papers, just like the cartoon, Sudoku and crossword. They are a little bit of reader glue. And a good astrologer will do two things for a newspaper: bring in new people and keep the ones you've already got.”

Indeed, when women’s magazines publish their annual astrology specials, sales generally increase by at least 10%.

Like newspapers and magazines, tea-leaf readers have mostly moved online. While astrology continues to thrive in the printed press, fortune-telling is increasingly a web-based activity – with on-demand predictions available via webcam, text message and even smartphone app.

Take RTL, the French information hub. With a dedicated iPhone application and more than 550,000 visits per month to its website’s astrology page – representing up to 10% of all visitor traffic – RTL has left nothing to chance.

The leading French fortune-telling site, Cosmospace, boasts an annual turnover of €15 million. Meanwhile, Vivendi competes through its Wengo website, number one in France for “expert advice by telephone,” including fortune-telling.

Unfortunately for those who base their investment strategy on the movement of the stars, there’s little evidence that the markets can be tracked by crystal ball.

Consider a 2001 experiment conducted as part of the UK’s National Science Week that pitched a so-called “financial astrologer” against an experienced private investor and a four-year-old girl, each of whom invested a fictional £5,000 on the London Stock Exchange.

Given that the FTSE 100 was down more than 16% that year, it’s hardly surprising that none of the three did especially well. And even those without a crystal ball might have correctly predicted that the “financial astrologer” would finish last, underperforming the four-year-old girl by well over 100%.