Morning all,

Some weeks ago I mused that there were three things in life that were certainties, Death ,Taxes and the Dow going to an all-time high. Also mentioned Nurses but that’s another story! And so it came to pass Dow hits a high!!

Maybe it’s a good time to reflect on where the US economy was at that time-

• GDP Growth: Then +2.5%; Now +1.6%
• Regular Gas Price: Then $2.75; Now $3.73
• Americans Unemployed (in Labour Force): Then 6.7 million; Now 13.2 million
• Americans On Food Stamps: Then 26.9 million; Now 47.69 million
• Size of Fed’s Balance Sheet: Then $0.89 trillion; Now $3.01 trillion
• US Debt as a Percentage of GDP: Then ~38%; Now 74.2%
• US Deficit (LTM): Then $97 billion; Now $975.6 billion
• Total US Debt Outstanding: Then $9.008 trillion; Now $16.43 trillion

So all good really! And that’s in five years!!

Still US companies are raking in the cash and building a huge cash pile of $1.6trillion dollars..not too shabby and of course what do they do with it…well they certainly aren’t hiring ordinary workers as can be seen from the above numbers.

Anyway to our market,well its off to the races with the usual suspects leaading the way.If only BHP and RIO and some other resource stocks would chime in the index would really kick.No chance of that just yet I am afraid ..patience required..

Expect another strong day here and every analyst is saying get on board so it takes a brave man to go against the trend…everyone is hoping that once again they can get out in time before the market wakes up to reality…in the meantime make like you stole it…

With so much free money chasing returns the equity bubble looks set to continue …this is despite anaemic growth in profits down under this year and an election on the horizon! Still these things do last longer than we all expect ..

Idea of the Day

Had a presentation yesterday from a small Oil company launching an IPO..yes remember those..it must be a bull market..anyway looks interesting..small capital raising and a valuation of $50m roughly..its a stock called IPB.

Background on the Company

By way of background IPB is an Australian oil and gas exploration company and has built a strategic position in the oil-prone near-shore margin of the Browse Basin, offshore North West Australia.   The Company has interests in two permits covering a total ~9,500sqkm:

• WA-424-P – 75% owner (25% CalEnergy) – prioritised Pryderi Prospect for drilling in 2H2013.  The well is fully funded by the Company’s farmout partner CalEnergy.  Independent Technical Expert assessed that the Pryderi Prospect in Permit WA-424-P has a mean recoverable prospective resource of 40MMbbls and there is a 45% chance of an oil discovery. The Independent Technical Expert Report also assessed a high case (P10) of 78 MMbbls and a low case (P90) of 12 MMbbls for this drill ready Prospect.
• WA-471-P – 100% owner – immediately north of WA-424-P, 2D seismic data in the block highlights the potential for stratigraphic traps at deeper levels to the Pryderi Prospect.  IPB plans to further evaluate through the acquisition of 3D seismic data once the Pryderi well has been drilled.

Key Company highlights

• Large acreage position in highly prospective region
  • The Company has substantial acreage in the Browse Basin offshore North West Australia of approximately 9,485 km2 comprising:
    • the WA-424-P Permit (6175 km2 ) and
    • the WA-471-P Permit (3310 km2).

The Browse Basin which is located offshore North West Australia, an area where some of the largest oil and gas companies in the world are actively pursuing exploration and production projects.

• Low cost environment for exploration and development
  • The Company’s Permits are characterised by relatively shallow water (maximum depth of approximately 90 m and shallow drill targets (average approximate depth 700 – 900 m), which the Company believes will provide an attractive, low cost environment for exploration and development in comparison to other deeper water projects.
  • Fully funded near term exploration plan. “Pryderi-1”, will be drilled and funded by CalEnergy pursuant to the terms of the recent Farmout Agreement.

One for speculative investors but the small free float and plenty of friends involved should mean it’s well supported..downside is the time until the drilling starts in June/July but they have some permits to be announced in the meantime which will help..let me know if you have any interest and I will send more details and a prospectus…otherwise just buy the banks, WES,WOW and anything that pays a div!!

Things to make me go all bullish..its an all time high!!Yay!!

1Adios!!.Hugo Chavez is dead..long live the king.

2.Manchester United robbed of Champions League spot by the referee..shame on you..The choosen one Mourinho very gracious in defeat..take a lesson Rafa!

3.In  Brambles sources have suggested the Brambles board are seriously reassessing options to offload its Recall Information Management subsidiary this calendar year. Brambles tried to sell Recall early last year but pulled the auction citing deteriorating capital market conditions.

4. ACCC chairman Rod Sims has opened the door for more media mergers, arguing rapid changes in technology may make the regulator more willing to approve mergers in fast-evolving industries.Anothere reason to be long media stocks.Election year spending as well!

5. Nufarm has lost a second exclusive distribution deal, worth $100 million in sales, on the back of ongoing concerns over the agricultural market and increased competition. Shares in the listed crop protection company slumped by more than 12 per cent yesterday after agricultural biotechnology company Monsanto announced it would be seeking an alternative supplier of its Roundup-branded glyphosate in Australia and New Zealand.

6.Despite the Dow hitting a high ,volume was way down on what would be expected..more interest in the media than in the markets!

7.China announces a 7.5% GDP target and an inflation target of 3.5%…good to see and of course they will achieve that..its China after all.

8.The sad fact is the majority of Americans will feel no real benefit from the rising Dow as the vast proportion of the wealth there is concentrated in the hands of a few…this is a great piece of analysis on the State of the US inequality..click on this

9. Sirius Resources: appears set for another share price surge when new exploration results from the company’s Fraser Range nickel-copper project are released within the next day or so. Sirius shares touched a new high of $3.34 on Tuesday before trading was halted, with the company saying it would release the exploration results by the start of trading on Thursday.

And finally ..just to ensure you read this to the end…..

Two whales walk into a bar.

The first whale says to the other, “WOOOOOOO. WEEEEEEEEEEOOOOO. WEEEEEEEEEEEEEEEEEEEEEEEEEEOOOOOOOOOOOOOOOOOOOOO.”

The second whale says, “Shut up Steve, you’re drunk.”

Enjoy the ride

Clarence

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