Morning all,

Well yesterday we got the bad news from GI Joe with his JOEYFO…looks like he will have to cancel the biscuits…good to see the blame game for the deficit and the budget blowout ……and good to see they found a job for Sophie Mirabella…and there was me thinking that I would never see her again on Q&A which would have been a shame indeed….not sure what these idiots in Canberra take us for but after 100 days I think we are all singularly unimpressed…they all seem to be as bad as each other…still the cuts are coming…austerity downunder …its coming to a service near you..of course raising taxes seems to be out of the question and paid parental leave will survive even if schools, hospitals and the NDIS and of course the ABC take a big hit!!!

The dollar continues its slide…below 89 cents..I remember the heady days when we all believed that a string dollar was a vote of confidence in the country..we felt good..smug..complacent and bugger the manufacturing industry..at least it kept inflation down and ensured petrol was not a luxury…trouble with the low dollar is there is no one left to benefit ..they have all gone..too late she cried Mr Stevens ..way too late…

To the barricades then and in the market expect to see some weakness at the knees with Taper firmly in mind…Iron ore is slipping ,Gold is slipping, Johnny Foreigner is leaving and selling the dollar..GI Joe is still in opposition mode..all blame and no plan…

Idea of the Day

Good to see my idea yesterday of BLY up 10%..there is also movement at the station for the word has passed around that Mining Services are pretty bombed out to such an extent that we are seeing our friends the Vultures(Private Equity) picking over a few carcasses and even a non binding,highly conditional look at your books approach from BKN for Austin Engineering…More to come I expect..

For all of the funds that sucked up to their favourite broker in order to get access to the wonderful IPOs this Xmas ..unlucky..they have all been dogs it’s fair to say!!Pact Group was the latest casualty of hype yesterday dropping from its issue price of $3.80 to close at $3.32…good PR and Hype –Greedy brokers..

Yesterday we hosted the technology conference…very interesting…big changes ahead as the world takes to Machine 2 Machine connections!!!Supposed to be 20bn by 2020…everything will be connected to the world wide web…everything….and who will benefit…well apparently you and I …loads more free time to stare at our navels as productivity increases from machine anyway..we will only have to pop down the Dole office to pick up our cheques as the machines take over…however Netcomm (yeah I know they make the modems in Office works)NTC ,have positioned themselves very well to take advantage of this boom…next few years should be a good time for these guys..have run relatively hard but they are only valued at $36m market cap…one to buy on a down dip or at least some today to get a handle on some so you don’t forget…

Few others that impressed…OTH ..still really like this story on Real estate data…using internal funding to pursue growth activities and are NOT keen to raise money at these levels.. still believe that these guys will be bought by REA at some stage..it just makes so much sense..anyway…a few ideas to think about…

Things to make me go Ho Ho Ho….

First off ,congratulations to the Australian Cricket team for wrestling the Ashes off my countrymen…well some of them that aren’t Kiwi’s or South Africans!…..let’s hope the rest of the series is tight but I think 5-0 will be the result!!!

Bradken has launched a “highly conditional” takeover bid for Queensland’s Austin Engineering group, according to a statement from the target company to the ASX last night. Bradken, chaired by former NSW premier Nick Greiner, already owns 21.5 per cent of Austin and has offered 0.75 Bradken shares for every Austin share, valuing the company at more than $300 million.

Envestra: shareholders will receive up to $241 million cash under a new deal struck with suitor APA Group. APA secured the support of Envestra’s independent board committee by bumping its takeover offer to $1.17 a share.

In really surprising news there is a takeover announced in a gold stock as Asanko Gold (Canada) to acquire PMI….A West African gold and producer…hear that ..that is the gun going off for more takeovers to come!!!Of course they will be a levels that shareholders find discomforting

Linc Energy start trading in Singapore today…hope their grand experiment to do the Big Nath and relocate to Singapore is more successful!!!!!

Qantas: and the federal government are working together on a final proposal that would assist the airline in levelling the playing field against rival Virgin Australia without guaranteeing all of its debt. The proposal is believed to involve the provision of a standby debt facility with a government guarantee that Qantas could access for a fee.

Warrnambool Cheese & Butter saga continues as Saputo has put more money on the table to gain control of the highly sought-after Warrnambool Cheese & Butter, taking the target’s value to as much as $538 million in the three-way contest. The move by Saputo yesterday came as the Takeovers Panel stopped short of censuring the Canadian company and WCB for going back on a promise to offer special dividend payments to the target’s shareholders, in return for a promise that it sweeten the deal and extend the offer.

U.S. report says Pentagon less dependent on China rare earths….not the Xmas present LYC would want!!!

Estate taxes are the bane of many a billionaires life but it seems that a loophole in the US has allowed shifting of assets between trusts and as a result these tax shelters may have cost the federal government more than $100 billion since 2000, says Richard Covey, the lawyer who pioneered the maneuver. Good stuff..the rich can buy the best advice!!

VIX or the fear index up a smidge last night to 16.21 (+1.12%)….has rallied from 12.5 recently…

The wild ride in Bitcon continues as the price falls to $814 ….

Good to see one lucky Lotto punter walk off with the $70m jackpot!!!

Uncle Fester(Glenn Stevens) will today appear in front of the parliamentary economics committee to give us his take on where things are at…should be interesting and another chance to jaw bone the Aussie dollar down!!

According to a recent survey by the Pew Research Centre, just 33% of Americans think their children will have a better life than they did. On the other hand, 62% believe their children will be worse off. In Europe things look even more dire. Just 28% of Germans think their children will be better off than they were. In the UK it’s 17%, in Italy 14%, and in France just 9%. Contrast this gloomy picture with China, where 82% think their kids will have it better than they did. In Nigeria, the number is 65%. In India, 59%.

Remember the German elections in September…well finally…Chancellor Angela Merkel took charge for a third term, after forming a coalition with the defeated Social Democratic Party….seems things move slowly in Germany..

And finally….bit rude but good all the same….stop reading now if easily offended!!

Shamus and Murphy fancied a pint or two but didn’t have a lot of money between them; they could only raise the staggering sum of one Euro.

Murphy said “Hang on, I have an idea.”

He went next door to the butcher’s shop and came out with one large sausage.

Shamus said “Are you crazy? Now we don’t have any money at all!”

Murphy replied, “Don’t worry – just follow me.”

He went into the pub where he immediately ordered two pints of Guinness and two glasses of Jamieson Whisky.

Shamus said “Now you’ve lost it. Do you know how much trouble we will be in? We haven’t got any money!!”

Murphy replied, with a smile. “Don’t worry; I have a plan, Cheers!”

They downed their Drinks. Murphy said, “OK, I’ll stick the sausage through my zipper and you go on your knees and put it in your mouth.”

The barman noticed them, went berserk, and threw them out.

They continued this, pub after pub, getting more and more drunk, all for free.

At the tenth pub Shamus said “Murphy – I don’t think I can do any more of this. I’m drunk and me knees are killing me!”

Murphy said, “How do you think I feel? I can’t even remember which pub I lost the sausage in.”

Have a great Wednesday…enjoy the Taper…60% chance it will happen according to PIMCO man.

Clarence

Xxx

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