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Morning all,

Well, what a day yesterday, worse game of Simon says ever. Memo to Crean if you are going to stab Caesar in the back in March better make sure you have a weapon. Still at least he gets to have six months off before the rest of his colleagues. Didn’t he look happy with Rudd..if looks could kill…maybe he needs one of those KGB umbrellas…

Our market will continue to suffer today following weak leads from overnight but the big players have retreated to the sidelines which means its easy to push things around..I wouldn’t be surprised to see some bargain hunting at some stage today as some book squaring pre the weekend. Maybe the Cypriot Government will get its act together and surprise us all…amazingly the US seems really happy for a Sovereign nation ion the edge of the Middle east to fall effectively into the hands of the Russians..lots of promises of gas for them ..Turkey may object to that though!!

SPI futures were down 35 but as I say maybe it won’t be that bad. Gold has been the one bright spot overnight, so maybe NCM will rally today..no really maybe they will. Oil was under a little pressure as the US said that it is using less than 20 years ago and producing way more. Strange days indeed!

During all the drama yesterday, Mike Quigley from NBN told us that things are progressing at a snail’s pace with the roll out of fibre..good for TLS as the little guys can’t compete on this infrastructure for a long time yet!

Anyway after the Cyprus thing gets resolved it will be back to business as usual and we should be able to forget Euro Trash for a while and focus on the better numbers from the US and China. Market will fall through my target of 4950 today but may start to find a base..it’s been a torrid week but looking at yesterday’s volume of only $6.2bn..sounds a lot doesn’t it but it was futures expiry day so it gets very inflated by that..so think it shows that the big guys are watching and waiting for the dust to clear…me too, to a degree..but start accumulating your favourites in the meantime…remember you can only buy when there are sellers!!

Idea of the Day

Gotta love analysts ..they upgrade or downgrade AFTER the fact…Macquarie has upgraded NAB after they have run 5 bucks..brilliant guys ..give that man a huge bonus!And the Goldman guys downgrade RIO after they have fallen from 78 to 57!!Give him a beach house..genius!!

Sorry but it amazes me these people…so what’s my idea of the day..ignore these analysts!!!They are telling you what has happened..

Things to make me go mmmmm.

1.Cypriot Bank Governor is called Panicos! Priceless…these guys are now holding a gun to the Russian’s head..bail us out or suffer a massive haircut of around 40%..in my limited ,mostly gained from movie experience, it’s never good to upset a Russian mobster. Good luck looking over your shoulder with those guys after you.

2.Bigger issue than Cyprus which is a drop in the ocean if they wanted to sort it,is the whole Zombieland economy. The French look like they are going backwards, not an uncommon feeling for a Frenchman but now the German economy is showing signs of strains according to numbers last night.Question is does Zombieland matter anymore..You bet!!Everything is connected to everything! Ask a butterfly!

3.Better numbers from US last night overshadowed by Euro Trash..may be the way of things for a while..still at least Ellen has arrived in Sydney!

4.Read an interesting article in the UK Telegraph today about the count down to Mark Carney taking over the job of head boy at the Bank of England.Things may be very different.One thing is certain the Government and the Budget are increasingly insignificant compared to what the Central Bank is doing with its money printing exercise.UK looks stuffed for some time to come I suspect.

5.Back in 2008 Trichet,President of the ECB, had this to say about Cyprus “For a small, open economy like Cyprus, Euro adoption provides protection from international financial turmoil.”Yeah right..what ever it takes ..well up to a point anyway!

6.Great performance yesterday from Billagone, looks like the bid if it comes will be much lower…least that is the rumour..as I have said in this letter many time, there is always a time when the hedge funds panic and maybe that is the time to step in..well, they panicked yesterday that’s for sure but probably the upside is still not enough..maybe steer clear!

7. We’ll save you…Aussie Home Loans: will be swallowed up by one of the big banks he spent his career battling, after the competition watchdog gave the green light to a takeover by CBA. The ACCC said on Thursday that it would not oppose the deal announced in December.

8.Looks like the NRA will scuttle Obamas plan for gun reform..from their cold dead hands indeed.

9.Lululemon suffered yesterday as its transparent corporate standards went a little too far..their latest offering was in fact see through.. “The truth of the matter is the only way you can actually test for the issue is to put the pants on and bend over,” Said Christine Day their CEO…these guys prize themselves on the quality of their products…doh!!

And finally…have a great weekend…let’s hope we get a plan C in Cyprus..a plan so cunning you could pin a tail on it and call it a weasel!

And I was going to add a political joke but what’s the point we all know its Canberra, so instead one bizarre moment on TV after yesterday’s bizarre moments…

“Today” show host Karl Stefanovic sat down with the Dalai Lama during his tour of the continent down under. For some bizarre reason he decided to tell him a joke:

“The Dalai Lama walks into a pizza shop,” and says, ‘Can you make me one with everything?’

It was met with a blank stare from the Dalai Lama!

Classic!

Clarence

XXX

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