The original Roman calendar was modeled on the Greek calendar, which was based on the phases of the moon. Because the lunar period is 29.5 days, its months were either hollow (29 days) or full (30 days). Full months were lucky and hollow months unlucky. But there were originally just 10 months. Martius (named after the god of war), was the first month of the year. Then came Aprilis (sprouting), Maius (growing), and Iunius (thriving). The next six had no names ... they were just named fifth through 10th: (Quintilis, Sextilis, September, October, November, December). Trouble was, that calendar year was just 295 days long. Over time, 10 more days were added, but there were still about 61 days of winter unnamed ... in that dreary period between December and March.
Then around 713 BC Numa Pompilius added two months. He stuck them on, naturally, after December, naming them Februarius (cleansing) and Ianuarius (commencing). Yes, February originally preceded January. To fill these months, he first added 50 more days, to bring the length of the calendar up to the more appropriate 355 days. And because Romans at that time considered odd numbers lucky and even numbers unlucky (the opposite of the Greeks centuries before), he made all months have an odd number of days by taking one day from each of the 30-day months, making a total of 57 to share between Ianuarius and Februarius. The former received 29, and the latter just 28. Much later, in 450 B.C., February was moved to its current position between January and March.
But as we all know now, 355 are still 10 days (and a fraction) short of a full year. As time went by, the Romans found it increasingly difficult to deal with those 10 days that had no place on the calendar. They couldn't just add a day to 10 different months; that would have made them even, and thus unlucky. So they created an intercalary month, by borrowing five days from the end of February (the end of the year) and adding 22 more to form a new month of 27 days ... but doing so only every other year.
Still, that added nearly a day every year to the natural calendar as measured by equinoxes and solstices. Scientists eventually suggested refining the system by skipping one insertion every 24 years. This would make the average year 365 1/4 days long, and pretty close to perfect, considering the earth revolves around the sun every 365.2422 days.
But this plan was never implemented. In practice, the insertion of the intercalary month was governed not by the scientists but by the government, in this case the pontifices. They, for various reasons you can imagine, inserted extra months when it served their purposes, and skipped the process otherwise.
From Julius Caesar to Greek Easter
It would be hard to invent a better method of sowing confusion among a populace, which is why the years immediately preceding Julius Caesar's big change, when there was no addition of an intercalary year for five years, were called "The Years of Confusion." It's hard to remember to deal with the calendar when you're waging war.
Finally, in 46 BC, Julius Caesar, wielding his considerable political power, and heeding the counsel of Sosigenes, an astronomer from Alexandria, Greece, straightened things out by introducing what we call the Julian calendar.
First, he decreed the one-time insertion of two extraordinary intercalary months between November and December, thus pushing the growing season on the calendar forward to where it belonged. Then he made some permanent changes.
He eliminated all further use of intercalary months.
He added 10 days to the year, making each month the length we are familiar with today. (He wasn't such a stickler for that lucky/unlucky mumbo-jumbo; he was man who created his own good luck.)
He made the new calendar start on January 1.
The fifth through 10th months kept their names, even though they were now seventh through 12th.
And he instituted the practice of inserting a leap day every four years.
Two years later, in accordance with a proposal by Marcus Antonius, the old fifth month, Quintilis, was renamed Iulius (Julius), in tribute to their great--and recently assassinated--leader. Then in 8 BC, the old sixth month, Sextilis, was renamed as Augustus in tribute to Julius Caesar's grandnephew and adopted son, Augustus Caesar. Politics, you know.
(The story about Augustus stealing days from February for his own month is just plain wrong.)
And after that, things went along swimmingly for a very long time. The Roman Empire declined; the rest of the world grew stronger, and after a while the scientists again noticed that the calendar was getting out of whack with the seasons. Apparently, the pontifices (remember them?) had misinterpreted the recommendations of Sosigenes the Greek and inserted a leap day every three years instead of every four years. In that way, gaining about 11 minutes per year, by 1582 it was 10 days ahead!
Enter Pope Gregory XIII and his Gregorian calendar, which resolved the problem by ignoring every leap year that ends with 00, but not if it's divisible by 400. It's not a perfect system--in 8,000 years we'll be about one day behind--but it's darn close.
The Gregorian calendar was quickly adopted by most Catholic countries (Spain, Portugal, Poland and most of Italy). Protestant countries and most of Eastern Europe followed later. But Russia remained on the Julian calendar until 1917, after the Russian Revolution (which is thus called the "October Revolution" though it occurred in Gregorian November), and Greece continued to use it until 1923.
Which brings us to Greek Easter.
While all countries have adopted the Gregorian calendar, most Orthodox churches have not. Some have accepted a compromise calendar, which enables them to celebrate the birth of Christ on December 25. But many remain committed to the Julian calendar, which currently puts that day on January 7. And the vast majority of Orthodox churches--most notably the Greeks--continue to honor the Julian calendar when it comes to calculating the date of Easter.
Which is a little ironic considering that it was Greek astronomers who had previously put the world on the "right" track!
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New Highs List
Segueing smoothly from the old Julian calendar, with its emphasis on the agricultural seasons, I note that in the business of investing there are seasons, too. But while the motions of the planets and moon are predictable, the motions of the market are not.
Still, we know that every bear market is followed by a profit-making bull market, and today I'm watching very carefully as the old bear market that very likely ended on July 15 (the Ides of July), is replaced by the next bull market.
What you don't want to do as the new bull market gets under way is be stuck holding the winners of the last bull market. You want to be holding the winners of the new bull market ... and the best way to do that is to keep an eye on the new highs list.
Today, for example, at mid-day, I saw 60 stocks hitting new highs. Some are too small, while some are too slow. But I'm most impressed by the fact that 19 of these 60 are in the medical sector, and that one of them is Myriad Genetics (MYGN), which I recommended on Monday. Congratulations if you had the guts to buy it!
Beyond that, I'm very impressed that of the 19 medical stocks hitting new highs, 10 of them are in the biomedical/biotech sector!
Listed from largest market capitalization to smallest, these are Celgene (CELG), ImClone Systems (IMCL), Alexion Pharmaceuticals (ALXN), OSI Pharmaceuticals (OSIP), Abraxis Bioscience (ABII), United Therapeutics (UTHR), Momenta Pharmaceuticals (MNTA), Osiris Therapeutics (OSIR), Emergent Biosolutions (EBS) and little Nabi Biopharmaceuticals (NABI), which is targeting nicotine addiction.
ImClone is the subject of a surprise takeover bid by Bristol-Myers, so it's in play; there's little unexamined potential there. But the other nine stocks are worth investigating. In general, I tend to favor the larger stocks, simply because there's less risk, and there's also greater potential for institutional investors to support the uptrend.
A Great Biotech Stock
So you might do very well with good old Celgene, which was initially founded as a unit of Celanese Corporation in 1980. Back on July 14, when it was trading at 71, the stock earned a spot in Cabot Top Ten Report, and here's what editor Michael Cintolo wrote.
"New Jersey-based Celgene develops drugs to treat cancer and other severe, immune, inflammatory conditions. Last year, 60% of revenues came from Revlimid, which is used in combination with dexamethasone for treatment of multiple myeloma (an immune system cancer) in patients who have received one prior therapy ... But the stock's latest run has been kicked off not by any achievement by the company but by the failure of a competitor. Back on July 1, SuperGen announced that its Dacogen drug failed a late-stage trial in patients with myelodysplastic syndromes (a group of bone-marrow diseases that limit the production of functional blood cells), cheering investors who look for the re-launch of Celgene's Vidaza in the fall. Revenue growth is accelerating and profit margins are fat."
Our recommended buy range then was 66-70, and if you had put in an order to buy at 70, you would have bought the stock last Wednesday. Since then, CELG is up 8%, and I think that long-term a much greater advance is possible.
Ideally, however, you should buy after pullbacks, as illustrated by the recommended buy ranges in Cabot Top Ten Report. With hot stocks like these, both your buying and selling strategies are crucial.
Editor's Note: Celgene will be followed in every issue of Cabot Top Ten Report until its momentum fades, as will OSI Pharmaceutical, which earned a spot in two recent tissues. This momentum-centric newsletter, published every Monday, is your ticket to the hottest stocks in the market, and as the new bull market pulls itself together, there's no better way to keep an eye on the potential leaders than subscribing to Cabot Top Ten Report. It's your best chance of discovering the next Research In Motion, the next First Solar, or the next Hansen Natural. To get started with a no-risk trial subscription, simply click the link below.
Yours in pursuit of wisdom and wealth,
Cabot Wealth Advisory