Morning all,

The bull market continues with the US pushing ever higher. My target for 5600 by Xmas is looking very doable. On Friday we once again saw the strength of the financial sector, as the yield is just too addictive. It has been the same story all year. TLS, Banks, Consumer stocks and selected industrials. Not much shaking in resource land but things has improved since those dark and stormy days back in June when Tax loss selling got he better of us.

Expect another modest rise today as we await the musings of the Reserve Bank. I believe that there will be NO further rate cuts as it will stoke an already enflamed property market and push us into Tulip territory. First time buyers are non-existent and the SMSF and Overseas investors are driving it higher. Seems a little like the tech boom where overinflated prices are being swapped for other overinflated prices. All is good for a time.

Money is cheap and plentiful. I even had the CBA phone me up and offer me more money. Citibank are blanketing Sky TV with lines of credit ads…anyone remember why we got into this mess in the first place. Apparently not.

News out of the Plenum is now starting to pick up the pace with the abandonment of the One Child policy. This was inevitable and so necessary. They seem to be running out of invisible friends and siblings for the little ones to play with. Seriously though the Chinese have a massive problem looming. Too many old people. Way too many. Not enough young taxpayers to pay fro them and the old population will expect more. They always do. This is a story that will get more coverage in the years to come. It is game changing!

Idea of the Day

GrainCorppeeps…now on Friday the stock got walloped. Our fearless leader Tone was quoted in the West Australian as being against the takeover from the Yanks and did not think it would go through. Result hedge funds panicked, left in droves and have probably done some dough on this one. Takeover arbitrage is a risky game especially when Nationalistic influences are at play. And so in every takeover there is a day when things turn sour for the fast money and they get whacked. That was Friday. I believe that the takeover will go through with some conditions. Archer are quoted in the paper today saying they are happy to be more accommodating and ensure all concerns are met. They will not walk away lightly.

As a result at these levels they offer good upside in an expensive market where bargains are hard to find. I believe that we will see them taken out and tidy profits made for those who hold their nerve. The Bid is worth well north of $13.00.

Things to make me go mmmm!!

Giving some old boats to Sri Lanka.

GrainCorp: Archer Daniels Midland has revealed it is prepared to offer a better deal for growers to help secure critical support for its $3 billion takeover bid for GrainCorp. Bowing to growing pressure from farmers and National party politicians, ADM’s grains boss Ian Pinner said his company was now looking for solutions for any concerns that have been raised over the sale of Graincorp.

Telstra’s: new budget broadband brand Belong has set its sights on capturing two million of the nation’s most price-sensitive households as the telco giant seeks to differentiate itself in the saturated market. The cut-price service was launched with little fanfare a month ago after rival iiNet swooped on Telstra’s failed bid to acquire SA Internet provider Adam for $60 million. The Belong brand is offering only two plans: $50 a month with 70 gigabytes of downloads and a $65 plan with 250GB.

Bega Cheese will take its bid for Warrnambool Cheese and Butter directly to the company’s shareholders this week as it tries to neutralise a recommendation by the target’s board for a sweetened offer from Canada’s Saputo.

SPI up 8 Gold up a bit and Iron Ore continues to hold strong.

This chart is the imaginary made up digital money used for illicit purchases..the gold of tomorrow…Ladies and Gentlemen..Bitcon!

As the great free money experiment continues to play out…Dumb and Dumber!

Look how high our markets are!!

Meanwhile in a Galaxy far away…Chinese reforms will include local governments able to sell bonds to fund construction and officials will be rated on measures including borrowing levels, the party said Nov. 15. An easing of the one-child policy and extra land rights for farmers also featured in the biggest package of reforms since at least the 1990s.

Good to see Tim Geithner get a proper job now with Warburg Pincus…all that rubbish about writing a book…Tim you had us going for a whilebut back to your pals for you.

And finally…a businessman met a beautiful girl and agreed to spend the night with

Her for $500. They did their thing, and, before he left, he told her that he

Did not have any cash with him, but he would have his secretary write a

Cheque and mail it to her, calling the payment “RENT FOR APARTMENT “

 

On the way to the office in the morning, he regretted what he had done,

Realising that the whole event had not been worth the price, he had his secretary send a Cheque for £250 and enclose the following typed note:

 

“Dear Madam:

Enclosed find a cheque for $250 for rent of your apartment. I am not sending

The amount agreed upon, because when I rented the place, I was under the

Impression that:

 

1 – it had never been occupied;

2 – there was plenty of heat; and

3 – it was small enough to make me feel cosy and at home.

 

However, I found out that it had been previously occupied, that there wasn’t

any heat and that it was entirely  too large.”

 

Upon receipt of the note, the girl immediately returned the cheque for $250

With the following note:

“Dear Sir:

First, I cannot understand how you could expect a beautiful apartment to

remain unoccupied  indefinitely.

As for the heat, there is plenty of it, if you know how to turn it on.

Regarding the space, the apartment is indeed of regular size, but if you

don’t have enough furniture to fill it, please do not blame  the management.

Please send the rent in full or we will be forced to contact your present

Landlady. ”

 

Have a great day

Clarence

XXXX

 

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.