Morning all,

After falling the most in 2013 the US market has risen the second most ! Even Gold rallied last night albeit giving back some of its gains towards the end of the day. Good news from the US on housing, with new home construction beating estimates, and a few corporate earnings numbers from Coke and J&J helped things along but Goldman Sucks disappointed with its numbers .Also it seems that the cost of living in the US has fallen as cheaper fuel and clothing helped there. ‘Zombieland’ was again weaker as German consumer confidence fell more than forecast and the IMF cut its growth forecast and urged the Zombies to do more.More!

So to  our market today. Expect a bounce today on the open but it will be tepid. Yesterday we saw some of the bargain hunting in anticipation of a Wall Street bounce so some is in the price. There may be some raking over the ashes in resource stocks with the Gold rally but again will be thin. More that sellers retreat than buyers get aggressive. Expect an up 20 start. But the BHP number may be a disappointment so can’t expect much from those guys.

Now for all you conspiracy theory fans out there ,there is a school of thought which has suggested that the Gold price was deliberately whacked by the order to sell 500 tons of the shiny stuff on Friday and that is all part of the Feds great plan to help the dollar look more attractive as the reserve currency and the place to put money in times of trouble rather than Gold which is now about as popular as Bitcons were after their recent crash…I am sure there are plenty more theories but I like that one…whatever the reason for the collapse in Gold I think it is overdone. But baby steps are needed to get confidence back in the metal. It will not happen overnight but it will happen!Maybe!

 

Idea of the Day

 

Now if you subscribe to my Gold is overdone theory and no reason why you should but one of my favourites is BDR..now I have banged on about this for some time and at higher prices but this is a low cost producer..they have cash as they have just completed a placement at 91c..now 67!!!Lucky professional investors to get a look at that one..but around the mid 60’s this is worth a look …it is dependent on a rally in the Gold price but their Brazil project looks to be going well and costs way lower than most around.. 200,000 ounces of gold forecast for CY 2013, Gold resource increased in 2012 12% to 5.14 Moz. Targeting a 1,000,000 ounces resource addition in CY 2013.

 

Things to make me go mmmm!

1.Macquarie Group: has taken a 19.84 per cent stake in listed mortgages company Homeloans Ltd, picking up the shares at a significant premium to the market price. According to substantial notices lodged on Tuesday morning, Macquarie paid $20.1 million for the Homeloans stake in an off-market transfer on Friday. The trade was done at 95¢ a share, or a 20¢ a share premium to Homeloans closing price on that day.Mortgages must be pretty good business these days …nice margins and the housing market is string stable and in places recovering nicely…so they tell us…and unemployment is still under control..according to the numbers!

2.Despite all the volatility in markets  from currency to commodities and shares the good old fear index fell last night by nearly 20% in the US. It does seem that there is a different play book this time being used!

3.Spot gold is down about 28 % from its record high in September 2011. During its 12-year rally, gold has gained more than 500 %. On an inflation-adjusted basis, it’s 43 % lower than the record high.

4.The boffins at the International Monetary Fund trimmed its global growth forecast and urged European policy makers to use “aggressive” monetary policy as a second year of contraction leaves the euro area’s recovery lagging behind the rest of the world. The global economy will expand 3.3 % this year, less than the 3.5 % forecast in January, after 3.2 % growth in 2012 ,this will be the fourth revision for 2013!

5.Worrying the IMF is ratcheting down its World trade forecasts as nations rely more and more on Central Bank intervention to keep things looking rosy. Their global trade forecasts one short year ago, as per the IMF’s April 2012 forecast, was supposed to grow 5.6%, they only see a token 3.6% growth. And its only April!!

 

 

6.European carbon permits declined by the most on record to an unprecedented low after lawmakers rejected an emergency plan to address a surplus of allowances. Carbon for December fell as much as 45% to 2.63 euros a metric ton on the ICE Futures Europe exchange in London, and German power prices for next year dropped to the lowest since at least 2007. Ireland, which holds the European Union presidency, vowed to continue talks on the plan after the bloc’s Parliament sent the draft back to its environment panel.

7.Anthrax is back and not the band!

LETTER ADDRESSED TO A U.S. SENATE OFFICE INTERCEPTED AT U.S. CAPITAL, TESTS POSITIVE FOR RICIN POISION. POISON LETTER WAS SENT TO SENATOR ROGER WICKER FROM MISSISSIPPI AT THE CAPITOL. FBI INVESTIGATING.

8. News Corp.’s entertainment business, due to be spun off from the rest of the company in the next few months, will go by the name 21st Century Fox, giving a modern-day twist to the company’s 78-year-old film-studio brand.Ah how progressive..next thing you know they will buy an internet business!

9.Bit of consolidation in the Gold industry announced yesterday.. Norton Gold Fields, Kalgoorlie Mining: Chinese-owned gold exploration and production company Norton Gold Fields is set to buy junior explorer Kalgoorlie Mining Company. The two companies went into trading halts on Tuesday ahead of the deal. Kalgoorlie Mining has a $7 million market capitalisation and recently reported a resource upgrade to 431,000 ounces of gold.

10. Ten Network has entered a period of exclusivity to the end of the month with Cricket Australia for the sports body’s media rights. The window effectively locks other bidders out of negotiations with CA, including the Seven Network and Fox Sports.If they get these rights it could spark a revival in TEN fortunes

And finally….

A guy is sitting at home when he hears a knock at the door. He opens the door and sees a snail on the porch. He picks up the snail and throws it as far as he can. Three years later, there’s a knock on the door. He opens it and sees the same snail. The snail says “What the hell was that all about?”

And appropriately enough from Marathon Man..Lawrence and Dustin!!

Christian Szell: Is it safe?… Is it safe?

Babe: You’re talking to me?

Christian Szell: Is it safe?

Babe: Is what safe?

Christian Szell: Is it safe?

Babe: I don’t know what you mean. I can’t tell you something’s safe or not, unless I know specifically what you’re talking about.

Christian Szell: Is it safe?

Babe: Tell me what the “it” refers to.

Christian Szell: Is it safe?

Babe: Yes, it’s safe, it’s very safe, it’s so safe you wouldn’t believe it.

Christian Szell: Is it safe?

Babe: No. It’s not safe, it’s… very dangerous, be careful.

 

Sums up markets pretty well I think!!

Clarence

XXXX

 

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