Morning all,

After yesterdays turn around due to moves in Shanghai to prop up their equity market (someone mentioned stimulus but really just priming the system for their week long holiday next week!) expect a slightly less buoyant day but positive none the less..Gold was in favour last night as inflation seen rising with all this money printing. So fast money will be back chasing Gold shares..for fast money read computer trading!

News from ‘Zombieland’ was positive ..at least if you are a banker or politician that is..the rest of the poor citizens are getting right royally scre*ed!

Our market will focus back on Gold stocks and these are some of my favourites..perm any three from these! PRU, RSG, RRL, PVM, PIR, GRY, SBM, SLR, NCM, NST and BDR. Accumulate these on weakness..

We have had news this morning of another Gold company merger..UML and CRC…this trend will continue with stock prices cheap compared to the underlying…

 

Idea of the day: From my new friends at BBY!!looks promising and I do like the Oil and gas sectors at the moment..one for the plucky but at 35 cents worth a look..Stop loss at 30..

KPL – Kina Petroleum (35c)

Waiting on update for Reserves and Resources

• BBY is awaiting a near term catalyst for KPL expected      to come from Horizon Oil (HZN), who are expected to update the market on      their Reserves & Resources prior to the AGM including the PRL 21 JV of      which HZN owns 45% (KPL 15%).
• As Horizon is an operator, they are subject to more      stringent assessment of their assets and more frequent authentication,      this process is undertaken annually to the BFS level, and in the past has      been undertaken by external consultants Risk; and we would assume this      will also be the case this year.
• BBY expects this will provide the market with a      valuable look through valuation done to the BFS level by an operator, and      will serve to solidify the commercial expectations for the assets in PRL      21 which underpin our current valuation, however this alone is not      expected to be a catalyst for a revision of our price target.

STRONG BUY recommendation MAINTAINED

12 month share price target = A$1.44/sh

We continue to look towards further drilling for significant catalysts, with the Tingu well expected to commence drilling in Q1 2013, and FID in mid 2013.

 

Things to make me go Ole

1.Economic news from the US was disappointing but who cares..in this new world order bad is good and money is there to be printed and everything will work out if we can only get equity markets up so everyone feels warm and fuzzy!Good plan!

 

2.Chinese super city facing bankruptcy! After three decades of spectacular growth, Guangdong’s boom town of Dongguan is on the brink of bankruptcy.

Up to 60 per cent of its villages are running up deficits and will soon need a bailout from the township, researchers at Sun Yat-sen University have discovered.

 

3.Spain announced more austerity cuts to try to get its economy back from disaster..this is just a prelude to the official bailout request coming in October..the sad fact is austerity will not put people back to work…25% unemployment…this is set to get worse for the poor people of Spain..and don’t get me started on Greece..the great Euro experiment has failed ..will someone please just shoot it and get it over with!!!

 

4.Echo Entertainment Group’s defence against James Packer’s Crown Limited is crumbling after the board moved against chief Larry Mullin, just two days after its long-serving director, Brett Paton, tendered his surprise resignation. This one is in play and Packer holds all the aces now!!

 

5.China’s central bank poured a record amount of cash into its banking system this week (well a record since records began in 2008!!!), helping to inspire a rally in an otherwise depressed local stock market. Meanwhile Baoshan Iron & Steel suspended production at a plant making products for the shipbuilding and oil industries, signaling the pressure that China’s economic slowdown is putting on the world’s largest steel sector.

 

6.Blackberry maker RIM posts a lower loss than expected…stock bounces ..not dead yet then..nearly..

 

7.Such sad news from Melbourne this morning …Jill Meagher..thoughts and prayers are with her family and friends.

 

8.RBA will cut by 0.25% next Tuesday ..should make yield stocks more attractive..TLS is one to have.

 

9.If we are waiting for a Chinese Stimulus package to rule them all ..may have to wait until after leadership change…they have learnt their lessons from last time and how it stoked inflation and the Government doesn’t want property prices to get out of control.

 

10.One issue for China that no one is talking about is the rapid ageing of its population…this is set to be a huge issue in the next 10 years and expect to hear more on this…one child policy all well and ghood but it has downsides..who is going to support the ageing population!!want to know more..read this

 

And finally last Scottish joke I promise..next week?

A Scotsman marries a native red Indian girl and they have a baby. They decided to call it, “hawkeye, the noo”

Answer to Spanish quote

‘Mucho ruido y pocas nueces –Lots of noise and little substance’

Have a great long weekend…I will be taking a break on Monday as it’s a holiday in NSW and since nothing happens on a Monday, I will be absent from the office….

Clarence

XXX

 

Any financial product advice contained in this email is general financial product advice only and does not take into account any one person’s objectives, financial situation or needs. Therefore, before acting on any financial product advice in this email, you should consider, with or without the assistance of an independent adviser, the appropriateness of the advice, having regard to your objectives, financial situation and needs.