Morning all,

News that the EU (or whatever initials it is this week)is bailing the Spanish Banks out with 30bn was welcomed by the markets in Zombieland..but as they said famously in Jaws ‘You are gonna need a bigger boat’.Still it’s a start…but this derailment is moving slowly towards its inevitable climax..I still cannot work out the whole bailout thing… when the ECB lends money to the banks at stupidly low rates ,then the banks buy Sovereign Debt with the money, then the Countries need bailing out with money from the ECB which is contributed by the Countries in the first place..Ponzi anyone?

 

Over the water in the US, they are starting to get cold feet on their earnings season. I was on Sky yesterday and an expert on the US said that expectations are so low that the corporates will have no trouble beating them..well that’s ok then…suspect the earnings season will disappoint.The last few months the World has taken a turn for the worse..look at ILU comments about the demand falling off a cliff (as has the share price).In fact last night was full of disappointment from US chip and truck makers!So much for that..come on Ben helps us out here.. we’re dying.

Expect more weakness in our market today with the big resource stocks under pressure..again volume will be woeful, as is the new norm. Down 30 is my call..

 

Last night on the box I talked about an old favourite of mine whose moment has arrived.I have been a shareholder of this for longer than I can remember..Its called Silex and they are in the business of 3rd Generation Uranium enrichment technology.The story so far…did a deal with GE money up front and a royalty..its been in a Pilot plant in the US for some time..and I do mean some time but we can see the light at the end of the tunnel with approvals possibly a month or so away.All the rhetoric coming from GE suggests that the approvals will go through at the end of August and then its game on. In the US they get 80 % of their Uranium from depleted weapons mainly from the Ruskies…and its managed by a company called USEC..not going to well. Nuclear is a big part of US energy and security of supplies is crucial. If the GE/SLX venture gets the green light they stand to do very well..They could easily make $120m a year in royalty payments ..not bad for a $750 m company..so I suspect there is more upside to come..HOWEVER they need the approvals so there is a risk still …The stock has run hard in the last week or so with comments form GE and the agency involved so watch and try to buy on a dull day if you like a little risk in your lives..I remain a shareholder but I did buy them at 60 cents back in 1995!!!Finally it may work…they also have some Solar so its not quite game over if they don’t get the nod but will be a long fall all the same! Not for the squeamish!

 

Things to make me go all enriched!

1.Spanish Miners heading for Madrid and a showdown..this will get violent and hinder the Governments plans to implement budget plans..watch this space!

2.Darrell Lea hits the Rocky Road and goes into meltdown..shame but hardly a shock..there’s only so much liquorice my wife can eat!

3. China has imported more Gold from HK than the entire UK reserves! And that’s just in the first 5 months of the year..and who can forget Gordon brown selling 400 tonnes of the stuff at $275!Almost as bad as the future fund selling all its TLS!!Almost!!

4.Not going to mention the England /Australia One day series…well one day maybe the Aussies will beat us!

5.US trade deficit with China continues to grow  .yesterdays figures from China not that flash so the GDP number on Friday will be a doozy!Gentlemen start your engines!

6.Big Nath looks increasingly unlikely to be able to raise the necessary to buy WHC ..and the market knows it.

7.I wish I had written Fifty Shades of Grey..how hard can it be?Got some time on my hands(hasn’t every broker) may give it a go!

8.Its 1066 all over again as the Battle for Hastings heats up with another bid on the Table..APA to counter attack?..careful you’ll have someone’s eye out with that!

 

Final thought… ‘in the land of the blind the one with the dividend yield wins!’BHP take note.Its all about yield..’money that what I want!’

And even more finally…

Dick Cheney walks into the Oval Office and sees The President whooping and hollering.

“What’s the matter, Mr. President?” The Vice President inquired.

“Nothing at all, boss. I just done finished a jigsaw puzzle in record time!” The President beamed.

“How long did it take you?”

“Well, the box said ‘3 to 5 Years’ but I did it in a month!”

Have a good one

Clarence

xxx

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