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Morning sports fans,

OhShutUpTotokKansasSucked-copy

Another disappointing day yesterday with the gains withering on the vine as the banks took a beating as the NAB cash raise sucks the  sector dry..

Big day today….Jokin Joe gets to smoke another cigar after a good job well done(only $41bn  deficit apparently) ,NAB returns from exile shiny and new ex rights and Greece paid back $750 in interest so they can access more borrowed money!

jokin joe

BUT last night we continued to have “Bondapocalypse” as the US bond yields charged higher and higher together with Zombieland yields.in the US ten year yield rose to 2.26% and the 30 year yield to 3.02%.

…..hard to believe that the era of negative interest rates on deposits and mortgages couldn’t last!!!Violent moves for sure…looks like the Hangover 4 from all that Central Bank largesse is starting to unwind..could get nasty and as a result there was a huge VIX option trade last night betting that volatility on the US market will rise above 17/18…that’s the average by the way so at the present 13.85 its hardly an out of the park bet…

US Bonds…but could be any of them!!

debt marlets s a

So as we get seismic shifts in bond markets, what are the implications for equity markets..well probably not good…especially here in ASX200 land…hard to get excited about the biggest sector of our market and despite the iron ore price recovering nicely nicely ,the Aussie dollar rise has taken some of the cream out of that…

I suspect that we may see the ASX200 trade down to mid 5500’s before a base is built..

Idea of the Day-NAB theoretical ex rights price 34.70…..

Well it is going to be all about the banks again…NAB will return from Coventry and ex rights to boot…BUT if you buy them today you will get the div!!!99 cents …then in the next twelve months you will rprobablt get another 2.00 making it nearly 3 dollars of divs in 13 months with a shareprice of around 31-32 bucks…doesn’t sound too shabby…plus the updside is that the new CEO Thorburn is actually doing something major rather than just riding the wave and cashing the performance cheques…this is good long term for NAB and it shows they have grabbed the nettle which is the UK and fuinally addressed it plus they have first mover advantage on the capital raising game…I suspect that the other banks will remain under pressure as punters pile into NAB..

For those of you that are shareholders I would recommend taking up the rights issue at 28.50…for those of you who aren’t shareholders time to start thinking about it!!!

Things to make me go mmmmm!!!

Looking forward to Mad Max…good reviews

Seems like most of the budget has been leaked anyway so the so called Budget Emergency is going to be solved with a new Childcare package….really…sure we will see a ‘fairer’ budget and no cigars smoked but after last years’ disaster the government is now too wimpy to do anything bold or visionary..they want to hold onto their jobs…big mortgages and lots of investment properties to sustain…that’s why negative gearing won’t go!!!!

Remember this magic moment from only last year….

joe-budget-image deal or dea

Once again spin is king…. ‘The NetFlix tax’…this seems like the gov is extracting more revenue from digital downloads..yes they are, but the revenue comes not from Netflix but from the consumer..so no new taxes?This is a new tax…already we pay more for digital downloads in Australia than others around the world and now we will pay 10% more….it will not hurt Netflix or others like Adobe just us…and of course it will help Murdoch and other Media barons remain competitive with poor product offerings and expensive rates…like Foxtel…

Oh how I wish I could short the Chinese market!!!Big rally yesterday following the rate cut there..see that’s how it is done…comes though on the back of the worst week since 2010 with a 5% fall over the week…volatility is set to increase there and that is not a  great sign!!

Apparently Atlas are back today…after three weeks..

One of my favourites KAR ….A successful Brazilian appraisal well has changed the potential development sequence of their Kangaroo development in the offshore Santos Basin and provided options for lower development costs. The Echidna-1 appraisal well, the results of which were released to the market last week, had delivered strong flow rates.Good stuff for a company stuffed with heaps of cash too!!!

In local company news… Orica has downgraded its guidance and raised the possibility of cutting its ammonium nitrate supply as it reported a 3 per cent drop in half-year profit to $211 million.

Gotta love computers… Almost $100 million worth of options related to volatility in U.S. equities changed hands in a split second today in Chicago, transactions that together would represent more than half a normal day’s volume.About 40 different trades went off at 12:16:04 p.m!!!! Just over 1 million contracts were traded, all told, about 54 percent of the total amount of index options that traded at the CBOE all day Friday.

And finally…..

I’m reaching out on behalf of a friend of mine who needs some help who wishes to remain anonymous.

His wife told him to go out and get some of those pills that would help him get an erection.

When he came back, he handed her diet pills.

Anyway, he’s looking for a place to live.

Have a great day

Clarence

XXXXX

Get a Global take on things at www.ntmarkets.com

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