Morning sports fans,

A few good things last night Michael Schumacher…Germany beating Portugal and the US scoring in 32 seconds!However there were lots more clouds on the horizon as Gazprom has cut off Ukraine’s gas supplies ,Russia is amassing troops on the border again and of course the Iraqi Civil War is going from bad to worse.The Kurds have now joined the fun and seized the fourth biggest oil fields.This coupled with the IMF pointing to lower interest rates for longer in a stalled US economy and the Iron Ore price falling below $90 does not appear to bode well…even the Gold price was easier last night.

Yesterday we saw a good rally off our lows as bargain hunters stepped in.Today I suspect we will slide a little..nothing dramatic but the Iron woes will be back…the problem is oversupply and the majors who have low sunk costs seem to be in no hurry to crimp their production…maybe their plan is to drive the small guys out of business and then pick up the pieces and dictate prices again..if so they are heading in the right direction.
Idea of the Day

Had a good meeting with iSelect yesterday and have come away very impressed with the new man at the helm…one or two issues to work through..provisioning trail fees and the loan to NIA but all up much misunderstood and a great business going forward…happy to continue to buy this one around 1.10…more in depth analysis tomorrow..

As the Iraqi situation gets worse and worse and heads towards a Syrian look alike conflict ,the West will have to respond and I feel that the only way is up on oil prices.In a world that is already spluttering along with growth numbers,blame it on the lack of sunshine,blame it on the moonlight or the the boogie,whatever ..it seems that we are in danger of falling backwards into a low growth ,low inflation,low interest rate,printing money abyss.This cannot be a good thing 6 years after the GFC…yet world markets are knocking on heavens door…all time highs …high P/E s and ridiculous valuations..yeah this time it is different I know!!!So……caution is the way forward I am happy to have a bit more cash than normal in portfolios as we navigate our way through the Northern Hemisphere summer…volumes will be low as holiday thoughts drift into traders minds and the bad news will continue to pile up ,ignored probably in the M&A frenzy that we are seeing..

 

keep-calm-and-print-money-4
It seems strange that corporates have so much cash stored up as they have failed to expand their own businesses ,take on new staff and invest yet they are quite happy to lob vast amounts of folding stuff at rival businesses or ones that offer dubious synergies in the hope of taking a huge leap..must be the power of the banker behind them or the egos of the CEO’s to make a vast acquisition…we had another one last night $50bn!!!It’s like confetti!!
Things to make me go mmmmm!!!

Super Cheap Retaill issued another downgrade and rose!!!Really?

Oil price rises will hurt Europe,Japan and the UK and of course China but the US which has improved its position thanks to the Shale boom and Russia will be winners..may explain why Obama is off playing golf!!

In its annual review of the US economy, the IMF cut its growth forecast by 0.8 percentage points to 2%,citing a harsh winter, problems in the housing market and weak international demand for the country’s products.

Seems strange that the US answer to mass shootings in schools is bullet proof accessories for their kids..at the very least you would think home schooling would be a growing option!

GM has now recalled more cars in 2014 than it made in 2012 and 2013!!!

Fortescue Metals Group will spend $US275 million buying four specialist iron ore ships in a show of confidence amid continued iron ore price weakness. On on into the valley of death rode the six hundred!

Meanwhile in Mosul the extremists are working hard on translating the manuals for the Black Hawks they have captured..seems they have a few tanks now too…this is going to get worse.

Looks like the Real Estate agents are getting a bit peeved with the charges that REA asks for and as a result there are rumours that the agents have got together to set up a rival web site..not in the REA game plan..priced to perfection stocks can suffer quiet dramatically…watch this space..maybe FXJ will be involved…you would think so …may even help OTH ,one of my favourites as the competition looks for an advantage over the incumbents.We shall see.

The Aquilla/Mineral Resources situation is looking intriguing as both went into a trading halt yesterday on an impending corporate transaction..

Napoleon once said that an army marches on its stomach…well maybe we can suggest that a Western economy marches on its house prices these days…although it seems like some of the steam is coming out of the UK market as the BOE moves to dampen enthusiasm..

This is a bloody good idea…the London Technology Week..it is expected to attract 30,000 entrepreneurs and the industry is forecast to create 46,000 new jobs in the next decade..plus the Chinese top dog will be in London..must be Wimbledon..

American pharmacy giant Walgreens may move to Britain for tax purposes as part of a $100bn restructuring that could include the acquisition of Boots.

This is whats driving the US takeover frenzy..Two tax-code quirks — one that charges U.S. companies when they repatriate overseas earnings, the other that allows them to claim a foreign domicile without moving their senior leadership abroad — Takeovers by U.S. companies of targets in low-tax environments — those with a corporate tax rate of below 20 percent — have doubled in proportion to all overseas deals, according to data compiled by Goldman Sachs Group Inc. analysts.
And finally….an oldie but a goldie..

Pierre, a brave French fighter pilot, takes his girlfriend, Marie,
out for a pleasant little picnic by the River Seine. It’s a
beautiful day and love is in the air.

Marie leans over to Pierre and says, ‘ Pierre , kiss me!’

Pierre grabs a bottle of Merlot and splashes it on Marie’s lips.
‘What are you doing, Pierre ?’ says the startled Marie

‘I am Pierre, the French fighter pilot! When I have red meat, I
have red wine!’

She smiles and they start kissing.

Things began to heat up a little and Marie says, ‘ Pierre , kiss
me lower.’

Our hero tears her blouse open, grabs a bottle of Chardonnay and
pours it on her breasts.

‘ Pierre ! What are you doing now?’ asks the bewildered Marie.
‘I am Pierre, the French fighter pilot! When I have white meat, I
have white wine!’

She giggles and they resume their passionate interlude: and things
really steam up.

Marie leans close to his ear and whispers, ‘ Pierre , kiss me much
lower!’

Pierre rips off her underwear, grabs a bottle of Cognac and pours
it in her lap.

He then strikes a match and lights the cognac on fire.
Marie shrieks and dives into the River Seine.

Standing waist deep, Marie throws her arms into the air and
screams furiously, ‘PIERRE , WHAT IN THE F… DO YOU THINK YOU ARE
DOING?’

Our ‘hero’ stands and says defiantly,

‘I am Pierre, the French fighter pilot! If I go down, I go down in
flames!’

Have a great day

 

Clarence

xxxx

 

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Get a Global take on things at http://www.ntmarkets.com

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