Morning all,

Another slightly positive night overseas although broader indices in the US finished pretty much unchanged. An interesting aside Gold shares ,those much maligned bunch of shorted stocks had a pretty good night last night in the US as they rose nearly 3% as a few shorts got squeezed.

At the moment the World and his wife are shorting or selling Resource stocks and putting it into Banks and Dividend paying stocks…now at some stage that trade will turn and the shorts will get punished but the hunt for yield from SMSF and Mums and dads continues at pace and there is little interest in the BHP or FMG of this World..at some stage they will be value and worth a look but not just yet I suspect..there needs to be a catalyst to start the revolution, not sure what just yet..maybe some M&A activity but since February 21st BHP has dropped -8.5%, RIO -8.6% and FMG -15.7%. Interestingly the spot iron ore price in Australian Dollars has only fallen -5%, to $20.00 above consensus forecasts.Anyway something to ponder and all this while the index has powered ahead with all-time highs across many sectors..the bull is back!

Expect a small positive day today but the momentum is slowing…still expecting a pullback ..it would be nice..

Idea of the Day

Now some of you out there will have noticed the meteoric run of SIR in the last few days..Now I am not a huge believer in the science of nearology..that is if your neighbour finds a huge deposit then of course it must follow that it’s only a matter of time before you do too..but there are a couple of stocks that look interesting..SFX is one of them..they have a new prospect called ‘Red Bull’..apparently it gives you wiings ..but they are starting a new drill campaign towards the end of the month and so far results have been very encouraging..the other one BUX is slightly more advanced with their ‘Widowmaker’ project EM survey well under way…now neither of these stocks are for the feint hearted as the risks are great but then so are the rewards..anyway if you are feeling brave it might be worth a small investment in either of these two..

Things to make me go mmmm….

1.Deavid Beckham’s new club PSG have made it through to the next round of the Champions league.Whilst closer to home Cronulla looks like it has a few issues to deal with pre NRL season.

2.Who said Communism doesn’t pay.. Ninety members of the National People’s Congress are on a list of China’s 1,000 richest people published by the Shanghai- based Hurun Report, up from 75 last year, according to a review of the data by Bloomberg News. Everyone on the Hurun list had a fortune of at least 1.8 billion yuan ($289.4 million), more than former Republican presidential candidate Mitt Romney….makes Eddie Obeid look like an amateur…looks as easy task for the new Government to stamp out corruption and graft…yeah right?

3.US Congress passes stop gap measure to keep the Government working..there is an oxymoron in there somewhere…anyway Beige Book out last night as well shows modest recovery with housing helping in the US.

Highlight s package…can you get highlights from something that is beige..I don’t think so…anyway..

*FED SAYS ECONOMY GREW AT ‘MODEST TO MODERATE PACE’ IN FEBRUARY

*FED SAYS ‘MANUFACTURING MODESTLY IMPROVED IN MOST REGIONS’

*FED SAYS SEVERAL DISTRICTS REPORTED ‘RESTRAINED HIRING’

*FED SAYS MOST DISTRICTS SAW MODEST PRESSURES ON PRICES

*FED SAYS ‘WAGE PRESSURES WERE MOSTLY LIMITED’

4.If you looked at the Zombieland economy it’s hard to fathom why the Euro Equity market is at a five year high…11.7% unemployment apparently is great news..obviously the markets are looking a long way out..usually 18 months but is it going to be fixed then..I think not!!Lucky the ECB is doing whatever it takes to keep the money flowing!

5.One of the World’s oldest banks is back on the front page with news that the Monte Paschi Bank’s the head of communications committed suicide by jumping off the building.

6.The main cause of potential social unrest in China is pollution…the powers that be..the rich powers that be ..need to address this as they don’t like a restless nation..not good for business.

The burning of coal is the main source of pollution in Beijing, according to estimates by Greenpeace and Peking University’s School of Public Health. Not a positive outcome for Aussie Coal Miners….gas looks good though… Woodside Petroleum chief Peter Coleman says Asian LNG demand is strong enough to support Australian projects, despite a raft of potential competitors in the US and East Africa, where he says similar cost challenges will be present.

7. Senex Energy Ltd., Asia’s worst gas exploration stock in the past year, is rebounding after Chevron Corp.’s investment in an Australian shale competitor stoked optimism that it may be the next target.Last week, Chevron made the biggest single investment in shale in Australia, agreeing to pay as much as $349 million for a stake in Adelaide-based Beach Energy Ltd.’s Cooper Basin prospects. Senex, which also explores in the Cooper Basin, has risen 13 percent since Chevron’s investment fueled investors’ expectations that the Brisbane-based company could lure a buyer, even after its shares had lost 40 percent in the prior 12 months, according to data compiled by Bloomberg.

8.And from the UK.. Bank of England governor Mervyn King said Wednesday that the British government should split the Royal Bank of Scotland into “good” and “bad” bank divisions to return it more quickly to the private sector.He believes that the RBS is holding back the British economy…think he may have other issues as well but it’s a start!

9.Glencore Xstrata joins the growing list of Miners pulling back their risk appetite.. ”We are afraid of greenfields,” chief executive Ivan Glasenberg told investors at an earnings presentation in London.

”And it’s been proven: we were correct. Greenfields are risky. Greenfields do have capital overruns. Greenfields do have delays which kill the NPV (net present value) on those projects.”

10. Whitehaven’s nearest and dearest are getting increasingly alarmed about the prospect of margin calls on shares held by executives, as the stock continues to plunge ahead of major shareholder Nathan Tinkler’s big court hearing on Friday. Tinkler’s failed $5.20 offer last year seems but a distant memory for coalminer Whitehaven, which has been trying to sell itself for at least four years. And with the stock sitting at just $2.63 on Wednesday, attention has turned to the prospect of Shenhua Energy, China’s largest coal producer, or another Asian buyer scrapping plans for a joint venture and instead pitching an unsolicited low-ball bid, The Australian Financial Review reports.

And finally…………

There was a flood in a village.

One man said to everyone, “I’ll stay! God will save me!”

The flood got higher and a boat came and the man in it said “Come on mate, get in!”

“No” replied the man. God will save me!

The flood got very high now and the man had to stand on the roof of his house.

A helicopter soon came and the man offered him help.”

No, God will save me!” he said

Eventually he died by drowning.

He got by the gates of heaven and he said to God “Why didn’t you save me?”

God replied, “For goodness sake! I sent a boat and a helicopter. What more do you want!”

 

Have a great day Clarence

XXX

 

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