Are U.S. rate cuts near an End?

Are U.S. rate cuts near an end?
RTGAM

Here's Allan Robinson's At The Bell which you'll find in tomorrow's newspaper:

The U.S. economy is just crawling along, but investors are betting that the U.S. Federal Reserve Board is almost finished its work, at least so far as lowering short-term interest rates go.The consensus opinion is that the Fed will lower the federal funds rate by one-quarter of a percentage point today to 2 per cent, but what investors will be looking for are hints."Growth appears to have ground to a halt with consumers tapped out, businesses on a recession-watch, and home builders still hacking away at output to pare bloated inventories," said Sal Guatieri, a senior economist with BMO Nesbitt Burns Inc.Nevertheless, it looks like the Fed may signal a pause in its rate-cutting strategy, Mr. Guatieri said.

"There's a sense if you keep cutting rates you get less and less of a bang for the buck," he said. The Fed has reduced the cost of borrowing and helped to deal with the availability of credit, he said. The federal funds rate has been lowered three percentage points since September.WHAT TO KEEP AN EYE ONThere is a lot of stimulus that has been injected into the system and concern is growing about the impact of the weak U.S. dollar on inflation, Mr. Guatieri said.

The first-quarter gross domestic product data, which is also scheduled for release today, is forecast to have increased at an annual rate of 0.5 per cent, compared with 0.6 per cent during the fourth quarter, according to a survey of economists by Bloomberg.Rising price pressures are also expected to be evident today with the GDP price index increasing to an annual rate of 3 per cent during the first quarter, up from 2.4 per cent during the fourth quarter of 2007 and only 1 per cent in the third quarter.HOW WILL THE MARKET REACT?All in all, that leaves investors in the somewhat precarious position of waiting for the economic turnaround.And indications that the Fed might be ending its rate-cutting strategy have already led to a stronger U.S. dollar.

The problem facing investors is that energy and materials, which account for about 50 per cent of the S+P/TSX, would be exposed to weaker commodity prices resulting from the stronger dollar. "A change in equilibrium of resource prices will have a large effect on the [index] performance," wrote Clement Gignac and Pierre Lapointe, strategists with National Bank Financial Inc.Copyright 2001 The Globe and Mail

PDP News

Petrolifera to participate in COPIC Producers Spring Conference; Posts new slide presentation on websitecnw

CALGARY, April 28 /CNW/ - Petrolifera Petroleum Limited (PDP - TSX) announced today that it is a participant at the 2008 COPIC Producers Spring Conference in Toronto, Ontario on April 29 and 30, 2008 and in Montreal on May 1, 2008. Presenting to the conference at

approximately 12:30 PM MST on Tuesday, April 29, 2008 and 9:30 AM on Thursday, May 1, 2008 will be Mr. Richard Gusella, Executive Chairman, Mr. Gary Wine, President and Chief

Operating Officer, and Mr. Kristen Bibby, Vice President Finance and Chief Financial Officer.To access the webcast of the presentation please go to the link provided below.http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID=2233660

Stocks sputter

Market News:
After the BellThe close: Stocks sputterRTGAMNorth America's modest rally turned south in the afternoon on Monday, leaving major indexes down slightly for the day.The S[amp]amp;P/TSX composite index closed at 14,085.85, down 18.02 points, or 0.1 per cent, sunk by the materials sub-index. Potash Corp. of Saskatchewan Inc., a materials stock, was the biggest single drag on the composite index:

Its shares fell 7.1 per cent, to $195.55, as part of a wider selloff among agriculture-themed stocks. Agrium Inc. fell 6.6 per cent.These steep losses were offset by Research In Motion Ltd., which rose 1.4 per cent, and Manulife Financial Corp., which rose 2.1 per cent. Royal Bank of Canada, which was downgraded to a "sell" recommendation by an analyst at Citigroup, fell 0.4 per cent.

The analyst believes Royal Bank will suffer another $4.2-billion in writedowns this year.After markets closed, Canadian Oil Sands Trust reported that its cash from operating activities doubled in the first quarter, to 92 cents a unit. The trust raised its quarterly distribution by 33 per cent. Its units closed at $46.32, up 91 cents.The Dow Jones industrial average closed at 12,871.75, down 20.11 points or 0.2 per cent. Microsoft Corp. fell 2.8 per cent after the deadline for Yahoo Inc. to accept its takeover offer came and went on the weekend.The broader S[amp]amp;P 500 closed at 1396.37, down 1.47 points or 0.1 per cent. Ford Motor Co. rose 9.5 per cent and Wm. Wrigley Jr. Co. rose 23.2 - the result of superstars Kirk Kerkorian and Warren Buffett, respectively, moving in on the stocks.

However, Monsanto Co. fell 2.8 per cent amid rising volatility in agriculture stocks. Visa Inc. reported after markets closed that its first-quarter profit rose 28 per cent. Its adjusted net income during the quarter - the first as a publicly traded company - beat expectations by a wide margin.[amp]nbsp;[amp]nbsp;Copyright 2001 The Globe and Mail

Post says Timminco will want to avoid Ceramic's fate

Post says Timminco will want to avoid Ceramic's fate
2008-04-25 08:20 ET - In the News
Also In the News (C-CEP) Ceramic Protection Corp


The Financial Post reports in its Friday edition that Timminco will want to avoid Ceramic Protection's tribulations. The Post's Barry Critchley, writing in Off the Record, says Timminco's chairman and chief executive officer is Heinz Schimmelbusch, the former CEO of Metallgesselschaft. He was fired in 1993 after the company's $1.2-billion (U.S.) in trading losses.

In September, 2004, Mr. Schimmelbusch was the chairman of Allied Resource when that company sold Alanx Wear Solutions to Alberta's Ceramic Protection. At the time, John Walsh was Alanx's CEO. As part of the deal, he joined Ceramic Protection. In December, 2006, Mr. Walsh moved on to became president and CEO of Timminco.

In August, 2007, Mr. Walsh became president of Timminco's magnesium division. Two weeks ago, Timminco said Mr. Walsh "had resigned to pursue other opportunities." Ceramic's problems started in September, 2006, when Arizona-based ArmorWorks, a customer of Alanx, cancelled a supply agreement. Ceramic sued. ArmorWorks countersued.

Thirteen months later, Ceramic and ArmorWorks settled. During that period, Ceramic's shares fell from $23.98 to $6.50 the day before the resolution was announced. The stock closed Thursday at $2.35.

Globe says Timminco shares rebound

Globe says Timminco shares rebound

2008-04-24 07:44 ET - In the News

The Globe and Mail reports in its Thursday edition the shares of Timminco rebounded sharply in a volatile trading session Wednesday. The Globe's Andy Hoffman writes Timminco shares closed at $21.60 up $3.37 on the Toronto Stock Exchange after the company said there were no material developments to explain the wild movements in its stock.

The shares were battered by short sellers and questions about the economics of its process to purify silicon over the past week. Volume topped 12 million shares, making it the most heavily traded TSX issue.

The company said "it is not aware of any corporate developments to account for the recent trading activity." Timminco has not permitted analysts or independent experts to view its "breakthrough" process to produce silicon pure enough for use in solar cells. Executives from leading German cell maker Q-Cells AG, with which Timminco has won a supply contract, have visited Timminco's facilities. A Q-Cells spokesman said the material delivered by the company has been "very good." Heinz Schimmelbusch, Timminco's chief executive officer, told Dow Jones he could not say whether customers had witnessed the production process.

Oil prices, gasoline costs to double: CIBC report

The close: Commodities beaten, Microsoft beats

RTGAM

Everything that was cold turned hot (and vice-versa) on Thursday after investors bet that the worst of the U.S. economic decline could be over. The new attitude could have to do with reports that the U.S. Federal Reserve is nearly done with its rate-cutting campaign, which is giving investors the feeling that the economy is nearing a turn - and, indeed, the previous rate cuts could be taking effect.

This sudden switch was bad news for the S[amp]amp;P/TSX composite index, among the best-performing indexes in the world this year and one of just a few that is above water. It closed at 13,966.33, down 103.47 points or 0.7 per cent.Investors ran away from what the benchmark index does best - provide exposure to commodities - and into the arms of previously beaten up stocks as they embraced riskier parts of the market.

The materials sub-index fell 3.5 per cent, partly a response to the fact that gold fell below $900 (U.S.) an ounce, well off its $1,000 level last month. The energy sub-index fell 2.9 per cent, with crude oil falling more than $2 a barrel, to $116.Potash Corp. of Saskatchewan Inc. fell 4.7 per cent, marking its second consecutive day of steep losses as it tumbles from a record high. EnCana Corp. fell 3.8 per cent, Canadian Natural Resources Ltd. fell 4.5 per cent and Goldcorp. Inc. fell 5.7 per cent.

Together, these four stocks alone accounted for 87 points of the index's 103-point dip.In the United States, the Dow Jones industrial average closed at 12,848.95, up 85.73 points or 0.7 per cent. Here, commodity producers, too, were thrown out the window as investors bought stocks that should benefit from a stronger - or at least more stable, economy. American International Group Inc. rose 7.1 per cent, General Motors Corp. rose 5.6 per cent and Citigroup Inc. rose 4.6 per cent.The broader S[amp]amp;P 500 closed at 1388.82, up 8.89 points or 0.6 per cent.

There, Ford Motor Co. surged 11.8 per cent, bond insurer MBIA Inc. rose 11.5 per cent and Apple Inc. rose 3.7 per cent.Microsoft Corp., which reported first-quarter results after trading ended, rose 1.1 per cent. It reported earnings, though down 11 per cent, that beat analyst expectations and also forecast higher than expected sales for the rest of the year.[amp]nbsp;Copyright 2001 The Globe and Mail

Oil prices, gasoline costs to double: CIBC report

SHAWN MCCARTHY
Thursday, April 24, 2008

OTTAWA — Crude oil prices will soar to more than $200 (U.S.) per barrel over the next five year – driving Canadian pump prices to $2.25 a litre and forcing a fundamental transformation in the North American economy, says Jeff Rubin, chief economist with CIBC World Markets Inc.
In a new report, Mr. Rubin forecast a continued run-up in crude prices, despite a slowing world economy and slumping petroleum demand in United States, the world's leading oil consumer.

He said he expects crude prices – now trading at above $116 (U.S.) a barrel - to average $150 by 2010, and more than $200 by 2012. That would translate into pump prices of $7 (U.S.) per gallon in the United States, and $2.25 per litre in Canada, double the current levels.

“Whether we are already at the peak of world oil production remains to be seen, but it increasingly clear that the outlook for oil supply signals a period of unprecedented scarcity,” the economist said.

World oil production has essentially stagnated at about 85-million barrels per day over the last two years, with growing demand met by increases in natural gas liquids, a fuel source that is used by the petrochemical industry but is of little use for transportation.

Mr. Rubin said he expects crude oil production to grow by about 1-million barrels per day over the next several years.
Meanwhile, growing demand in China, India, Russia and the Middle East will more than offset declines in the industrialized world.

“Millions of new households will suddenly have straws to start sucking at the world's rapidly shrinking oil reserves,” he wrote.

He said the sharply higher oil prices will prove devastating for the North America's industrial base, particularly the auto industry. But Canadians will benefit from the spinoffs, in terms of jobs, tax revenues and procurement, from the country's oil-rich provinces.

© Copyright The Globe and Mail

Timminco tries to placate investors CIBC Says $30.00 Target

Timminco tries to placate investors

ANDY HOFFMAN
00:00 EDT Wednesday, April 23, 2008

Under siege from skeptics and short sellers, Timminco Ltd. yesterday reassured investors about healthy shipments of solar-grade silicon to customers during the first quarter, but the update failed to buoy the company's battered stock, which skidded 17 per cent on unanswered questions about the economics of its "breakthrough" technology.

The Toronto company said its subsidiary, Becancour Silicon Inc., produced and shipped 100 tonnes of solar-grade silicon to customers during the three-month period at "average selling prices in excess of $60 per kilogram."

Timminco said "each shipment was tested by an independent laboratory and met specifications set by customers."

The news release did not provide information on Timminco's cost of production.
In the past, the company has said it is targeting between $10 and $12 per kilogram, less than half the cost of other solar silicon producers.

Robert Dietrich, Timminco's chief financial officer, declined to answer further questions.
In a voice-mail message, he said the company's news release provided "adequate information to understand the company's position."

René Boisvert, Becancour's Quebec-based president and chief executive officer, did not return calls.

Timminco was the top performer on the Toronto Stock Exchange last year, when its share price surged from roughly 40 cents to more than $20 after the once sleepy company stunned investors by saying it had developed a metallurgical process to purify commodity-grade silicon to levels high enough for use in solar cells, and won supply contracts with several unidentified makers of solar cells.

Last month, Timminco said it had signed a contract with Q-Cells AG, the world's largest solar cell manufacturer, to provide 410 tonnes of solar-grade silicon in 2008 and 3,000 tonnes in 2009 at "fixed prices."

Timminco's stock soon soared above $28, giving it a market value of more than $2.5-billion.
Timminco started up its new, 3,600-tonne-a-year solar silicon plant in the first quarter.
It has not provided earnings or revenue guidance for its new solar division.

However, in a recent report, CIBC World Markets analyst Michael Willemse estimated that once the company expands its solar silicon production to a projected 14,400 tonnes in 2010, the solar division could generate revenue of $652.3-million and post earnings before interest, taxes, depreciation and amortization (EBITDA) of $514-million.

For 2008, Mr. Willemse is estimating solar division revenue of $116-million and EBITDA of $84-million.

He rates the stock a buy with a $30 target price.

But short sellers and others are raising questions about Timminco's claims it has come up with a process to cheaply produce solar-grade silicon.

Timminco has said its process applies existing metallurgy techniques.
According to a patent application and information released by the company, Timminco heats commodity-grade silicon in a rotary oven powered by natural gas.

It uses chemical slag and stirring to remove impurities such as boron and phosphorous from the silicon.

A source who has done extensive research on Timminco's claims says the key issue is how many times the silicon must pass through the process to achieve the desired purity.
The company has not said what its energy costs are for each pass, how much slag is used or how much commodity-grade silicon is needed to produce one kilogram of solar-grade silicon.
"What's mystifying to me is why the company doesn't come out and say, 'This is going to all be water under the bridge in a couple of quarters, we're going to have fantastic earnings and we'll be vindicated,' " the source said.

Timminco's stock has lost 30 per cent in the past three days.
TIMMINCO (TIM)
Close: $18.23, down $3.92

GMP Loads Up As Anonymous Dumps+Q-Cells backs challenged silicon supplier Timminco

GMP Loads Up As Anonymous Dumps

Q-Cells backs challenged silicon supplier Timminco
Tue Apr 22, 2008 4:02pm EDT
FRANKFURT, April 22 (Reuters) - Germany's Q-Cells (QCEG.DE: Quote, Profile, Research), the world's largest solar cell maker, stood behind its Canadian silicon supplier, Timminco (TIM.TO: Quote, Profile, Research), which has recently drawn criticism about its operations.

Q-Cells Chief Executive Anton Milner told Reuters in an interview on Tuesday: "I sat down personally with the management to find out how they are doing, what they are doing and I had a very intensive discussion. We have a very high regard (for) the company and its management and what they've been able to achieve."

Timminco's stock fell C$3.92, or 17.6 percent, to close at C$18.23 on the Toronto Stock Exchange. The shares are off nearly 29 percent since Wednesday as questions mounted about the firm's silicon-purifying process.

A report in Barron's financial magazine questioned the company's claim that its technology can purify silicon for solar cells at a low cost, while the Globe and Mail newspaper reported that Wall Street investor Manuel Asensio, a short-seller with a reputation for bringing down companies, has also challenged Timminco's assertion.

Q-Cells signed a supply contract for directly purified metallurgical silicon with Timminco's subsidiary Becancour Silicon Inc (BSI) in March, which sees Q-Cells getting 410 metric tons this year and 3,000 tons in 2009, with prices fixed.

Q-Cells is negotiating a follow-up contract for up to 6,000 tons annually from 2010 to 2013, it said.

"The results that we have got on the Timminco product are with cell efficiency rates of well above 15 percent, which makes it a very interesting product, particularly given the cost of the alternative products," Milner said.

"The results on the sell side were positive and the product is very good and we are happy with the contract," he added.

Alternative products include polysilicon, whose prices have risen 20-fold in recent years as the solar sector began to compete with the semiconductor industry for the ingredient and supplies tightened.

Timminco has said it can purify metallurgical grade silicon at about half of what it costs its competitors. Last year, it shipped 89 tonnes of solar grade silicon to customers.
"With all technological developments there is risk. The largest risk is technology and they seem to have mastered that very well. There are normal ramp up risks beyond that, but those affect everybody," Milner said.

Q-Cells's Milner confirmed the company's outlook, which it raised in March after securing further silicon supplies.

Q-Cells expects sales to rise to 1.275 billion euros ($2.02 billion) this year and to more than 2 billion euros in 2009, while striving for a production volume at its core business of more than 1.5 gigawatt peak in 2010.

(Reporting by Eva Kuehnen, editing by Richard Chang)
(Additional reporting Jonathan Spicer in Toronto)

Tim:t "To doubt is easy," Mr. Sprott said in an interview.

Some Timminco brass cashed in early
ANDY HOFFMAN, JACQUIE McNISH, ANDREW WILLIS
00:00 EDT Tuesday, April 22, 2008

As TSX high-flier Timminco Ltd. hunkered down yesterday to defend its stock against bearish short sellers, at least one group of early investors had already pocketed more than $390-million (U.S.) by indirectly spinning off their holdings.
Safeguard International Fund LP (SIF), a private equity fund based in Wayne, Pa., and headed by Timminco's chairman and chief executive officer Heinz Schimmelbusch and Timminco vice-chairman Arthur Spector, transferred the fund's controlling interest in Timminco to another subsidiary company on March 29, 2007, according to regulatory filings.

That company, Amsterdam-based AMG Advanced Metallurgical Group NV, conducted an initial public offering on the Euronext in July. The IPO and subsequent stock sales provided proceeds to SIF and its senior officials, including Mr. Schimmelbusch and Mr. Spector, of more than $390-million.

"To the layman, it is a complicated structure, but to us, it was a very logical endgame for how to take this group of companies and get value for them for the limited partners," Mr. Spector said in an interview yesterday.

His comments came on a hectic day of trading for Timminco shares on the TSX yesterday.
The company's stock slipped 3.5 per cent on heavy volume of more than five million shares. Major shareholder Eric Sprott, whose Sprott Asset Management Inc. owns nearly 18 per cent of Timminco's stock, said his firm added to its position on the weakness.

"To doubt is easy," Mr. Sprott said in an interview. "What you get paid for in this business is figuring out if something is right early, while everybody else is doubting. That's how you make money."

Mr. Spector, who's also deputy chairman of AMG, said SIF, whose investors included the "usual suspects" of large U.S. pension funds, was reshuffling its assets and was due to expire next year.
SIF's reorganization, that transferred its Timminco stake to AMG, came within weeks of the Toronto company's stunning announcement on March 15, 2007, that it had won a contract to provide solar-grade silicon to a major solar cell maker.

The surprise contract was the initial catalyst spurring Timminco's meteoric ascent on the TSX, which saw its stock climb from roughly 40 cents to a recent high of more than $28.
Timminco said it had developed a metallurgical process to make solar-grade silicon at a cost lower than its competitors, which include well-established players such as Dow Chemical.

Ravi Sood, president of Lawrence Asset Management Inc., is among a group of short sellers who have been critical of Timminco's lofty valuation and said it is "very peculiar" that insiders transferred the stock and profited through its IPO.

"It is curious that the major shareholders have effectively been reducing their stake," Mr. Sood said. "It makes you raise your eyebrows."

In an unusual development, some investors complained of a dearth of available Timminco stock to short.

"There is no place to borrow Timminco stock," said one hedge fund manger that was trying to do just that yesterday. A number of fund managers said institutional investors that currently own Timminco, including Sprott, are refusing to lend their shares to investors that want to bet on a drop in price of the silicon producer.

Short sellers profit from borrowing shares from other investors or dealers, and selling the stock. The shorts then buy the shares back at a lower price and replace what they borrowed.
"Preventing borrowing doesn't change fundamentals from dictating the price of Timminco. It just stops the shorts from profiting on any decline," said one equity trader who covers hedge funds and other short sellers.

Until the transfer to AMG, Safeguard had been Timminco's controlling shareholder. In 2006, Safeguard added to its position after making a series of loans to what was then a cash-strapped producer of industrial-grade silicon, magnesium and magnesium extrusions.

For example, in September of 2006, while Timminco was working on its process to use metallurgy to make solar-grade silicon, Safeguard agreed to lend Timminco $3-million (U.S.) in exchange for the right to buy an equal amount of shares at 40 cents each.

At the time, Timminco had not publicly disclosed it was working on the solar silicon process.
On February 8, 2007, Safeguard agreed to lend Timminco $4.5-million (Canadian) for the right to buy an equal amount of stock at 42 cents a share.

Mr. Spector said Safeguard was aware at the time that Timminco was working on the project, but didn't know if it would win the contract with the solar cell maker.
"What is, is," Mr. Spector said.
TIMMINCO (TIM)

Timminco Ltd. is facing mounting pressure from one of Wall Street's most feared short sellers

From hot stock to target
ANDY HOFFMAN AND JACQUIE McNISH
Monday, April 21, 2008

It was the top performing stock on the TSX last year and a home run for investing guru Eric Sprott, but market darling Timminco Ltd. is facing mounting pressure from one of Wall Street's most feared short sellers to defend claims it has developed a breakthrough method for producing solar grade silicon.
Manuel Asensio, a flamboyant New York-based investor who boasts a trophy case full of corporate hides, is challenging the Toronto-based metals firm's assertion it can cost-efficiently purify metallurgical grade silicon to a level high enough for solar cell use.
By targeting Timminco, the controversial Cuban-born money manager has set a collision course with Mr. Sprott, whose investment firm, Sprott Asset Management Inc., owns more than 19 million Timminco shares.
Over the weekend, an article in financial journal Barron's raised many of the same questions about Timminco that Mr. Asensio has been asking.
Among them, how the company can claim its unique process allows it to refine silicon at half the cost of its competitors. Timminco's Quebec solar silicon plant began operating in December, but the company has yet to release detailed cost information for the new plant or its pilot trials.
Reached yesterday, chief financial officer Robert Dietrich said Timminco's contracts with several solar cell manufacturers, including the world's largest, Q-Cells AG, offer proof that the technology works.
Timminco has already delivered more than 89 tonnes of solar grade silicon to customers.
"They are very impressed. It meets or exceeds their specifications and it certainly meets their expectations. They're finding it to be material they can use. We haven't had any returned. We haven't had anybody not pay for it. We ship it and they pay for it and they're happy," Mr. Dietrich said.
Once Timminco's new plant is up to full capacity by the end of the second quarter, the company expects to produce 3,600 tonnes of solar grade silicon a year. It plans to expand annual capacity to 14,400 tonnes by mid-2009.
Timminco's claim it had developed a revolutionary way to purify silicon helped its stock skyrocket from 30 cents to more than $22 last year, generating massive returns for its major investors - including Mr. Sprott's firm, which owns nearly a fifth of the company. In the past 12 months, the stock has gained 490 per cent, giving the company a market value of $2.4-billion.
Demand for solar grade silicon is soaring. But it is expensive to produce. Attempts by companies such as Dow Chemical to develop cost-efficient ways to convert metallurgical silicon into solar grade silicon, with a grade of 99.9999 per cent, have been largely unsuccessful.
Timminco is spending about $87-million to construct its plant in Becancour, Que., while a competitor called Elkem AS is spending more than $700-million to build a plant with less capacity.
Mr. Dietrich says Timminco's costs are so much lower because its "admittedly simple" process is very different than Elkem's.
"There are a number of people who would read our patent applications and nod their heads knowingly and say, 'Yep, that makes sense.' They may not be people that are shorting our stock," he said, presumably referring to Mr. Asensio.
Short sellers such as Mr. Asensio borrow stocks from their owners and then sell the shares on the bet that they can profit by buying them back at lower prices. Last month he went public with his Timminco criticisms in an interview with the Business News Network. He has also spoken frequently with Globe and Mail reporters about Timminco's alleged shortcomings.
Mr. Asensio, nicknamed Demolition Man for his aggressive tactics, won't say when he began to bet against Timminco or how much he is wagering.
He has been chased off company properties by security guards and was once fined by the National Association of Securities Dealers for "misrepresentation" in one of his many lawsuits. He raised early alarms about such high fliers as dotcom darling Winstar Communications and onetime Canadian hot stocks such as Crystallex International Corp. and Biovail Corp.
Mr. Sprott first made his name as a stock spoiler in the 1980s by accurately spotting such troubled companies as Grandma Lee's Inc. and Geac Computer Ltd. He parlayed his short selling successes into his investment firm, which is preparing for an initial public offering that values Mr. Sprott's stake in the company at about $1-billion.
Timminco Ltd.
Friday's close: $22.95, down $3.20
SOURCE: THOMSON DATASTREAM
The Timminco story
The edge
Timminco said last year it had invented a way to affordably refine highly pure silicon for use in solar panels.
The new market
The solar panel business is booming. And the highly purified silicon sells for a higher price than the metallurgical-grade product that has been Timminco's mainstay for years.
The doubter
One short seller, who profits when a stock falls, is questioning Timminco's claim that it can produce solar panel silicon for far less than its competitors do.

High fliers clipped

RTGAM

Think about a high-flying stock. Now watch it fall.That seemed to be one of the themes playing out in North America on Thursday, as many of yesterday's winners turned south. Some might call it "profit taking."

Others will call it healthy consolidation. And still others will point out that winning stocks tend to overshoot their underlying fundamentals, creating dangerous momentum that ends in tears.Here are a few examples: Potash Corp. of Saskatchewan Inc. fell 1.1 per cent, its first losing day in the past 13 sessions; Monsanto Co. fell 3.2 per cent, a day after surging 7.2 per cent; and Timminco Ltd. fell 7.9 per cent, the biggest one-day setback for the specialized metals producer in about a month.That said, many of the long-ignored or beaten-up stocks performed well, leaving major indexes above water.

The Dow Jones industrial average closed at 12,620.49, up 1.22 points or flat on a percentage basis. Citigroup Inc. rose 2.5 per cent, American Express Co. rose 2.2 per cent and International Business Machines Corp. rose 2.2 per cent. Pfizer Inc. was the biggest loser on the blue-chip index, falling 3.3 per cent and dragging down Merck [amp]amp; Co. Inc. with it.The broader S[amp]amp;P 500 closed at 1365.56, up 0.85 of a point or less than 0.1 per cent. Google Inc. closed at $449.54 (U.S.), down $5.49 or 1.2 per cent.

After markets closed, the Internet company reported a surprising 31 per cent jump in first-quarter profit, beating expectations. In extended trading, the stock rose 11.5 per cent, to $501.In Canada, the S[amp]amp;P/TSX composite index closed at 14,115.50, up 16.02 points or 0.1 per cent. Without Potash Corp. - the biggest mover on the benchmark index in recent weeks, and now the biggest one-day drag - to drive it higher, the Big Banks and energy producers took the lead. Royal Bank of Canada rose 1 per cent and Toronto-Dominion Bank rose 0.9 per cent. Canadian Natural Resources Ltd. rose 1 per cent and Suncor Energy Inc. rose 1.7 per cent.[amp]nbsp;[amp]nbsp;Copyright 2001 The Globe and Mail

Low inflation? Ya, right

Low inflation? Ya, right

Thursday, April 17, 2008
Not everyone is buying the idea that the U.S. inflation rate is relatively benign and therefore nothing for the Federal Reserve to worry about as it slashes its key interest rate. Some observers believe the actual rate is closer to 9 per cent, rivalling China's problematic rate of inflation.

Martin Hutchinson, writing on Breakingviews.com (subscription required), noted that the official change in the consumer price index, as reported by the Bureau of Labor Statistics, showed a rise of 0.3 per cent in March. Big deal. But that is only after BLS changed its seasonal adjustment policy drastically.

Traditionally, BLS has seasonally adjusted the March rate downward, by an average of 0.2 percentage points over the past 10 years, and at most 0.3 percentage points. This time, according to Mr. Hutchinson, the seasonal adjustment was a baffling 0.6 percentage points because of a change in the methodology in January.

If instead the seasonal adjustment had followed the average, the March reading for the consumer price index would have been 0.7 per cent, more than double the official 0.3 per cent, which amounts to an inflation rate heading toward 9 per cent on an annualized basis.

“That is remarkably close to the inflation rate in China, where the central bank is busy raising rates and squeezing financial institutions,” Mr. Hutchinson said. “It's well above the rate in the euro zone, where the European Central Bank has held rates constant, without letting troubled banks run out of money. But the Fed has been cutting while prices rise.”

Barry Ritholtz, writing on The Big Picture blog, couldn't agree more with the 9 per cent figure floated by Mr. Hutchinson: “That's a little closer to reality than the reported nonsense we got yesterday,” he said.

“Unless of course you believe that food prices in the U.S. have only risen 4.5 per cent over the past 12 months. Other countries with much stronger currencies are suffering from global food inflation in the double digits – but we of the free-falling American Peso have inflation under control. Does that smell kosher to you?”

© Copyright The Globe and Mail

Oil Patch Moving Up

JPMorgan relief - If good news comes in waves, Wednesday is a good day

JPMorgan reliefRTGAMIf good news comes in waves, Wednesday is a good day for

surfing.JPMorgan Chase [amp]amp; Co. reported first-quarter earnings that were 50 per cent lower than last year, but above expectations and a huge relief for investors worried that big surprises lurked at the investment bank.As well, the bank's per share profit of 68 cents (U.S.) was higher than the consensus expectation of 64 cents a share.This follows the report Tuesday's report from Intel, which announced a 12 per cent dip in first-quarter earnings but a confident prediction for second quarter sales that topped expectations.In economic news, the U.S. Labor
Department reported on Wednesday that consumer prices - an important gauge of inflation - rose 0.3 per cent in March, much higher than the flat reading in February but right on expectations. Much of the increase was due to rising energy prices.

The core rate, which strips out food and fuel prices, rose 0.2 per cent, also in line with expectations.The U.S. Federal Reserve, which has been cutting its key interest rate to strengthen the economy, is betting that the inflation rate will settle back as the economy slows.North American stock index futures were higher with an hour to go before markets open for trading. Futures for the Dow Jones industrial average rose 64 points, to 12,418. Futures for the broader S[amp]amp;P 500 rose 9 points, to 1345.In Europe, the U.K.'s FTSE 100 rose 0.9 per cent and Germany's DAX rose 0.6 per cent. In Asia, Japan's Nikkei 225 index rose 1.2 per cent in overnight trading.[amp]nbsp;Copyright 2001 The Globe and Mail

PDP Insider Share Ownership

Oil prices surge to new record

Wednesday, April 16, 2008
NEW YORK — Oil prices surged to record highs Wednesday as the weakening U.S. dollar drove up investments into commodities.
Light, sweet crude for May delivery rose as high as $114.53 (U.S.) a barrel in electronic trading on the New York Mercantile Exchange before retreating to $114.46 by midday in Europe, up 67 cents.
The contract closed at a record $113.79 a barrel Tuesday and then jumped in after-hours trading to an all-time high of $114.08.
In London, June Brent crude contracts were up 52 cents to $112.10 a barrel on the ICE Futures exchange, after setting a new record of $112.16 earlier in the session.
Analysts said the oil increases were being caused by euro's new highs against the U.S. currency — $1.5966 per euro — as higher inflation in the euro zone practically eliminated the chances of an interest-rate cut by the European Central Bank.
Annual inflation in euro nations rose to a record 3.6 per cent in March, boosted by higher prices in transport fuel, heating, dairy products and bread, said Eurostat, the EU's statistical agency. It is the highest inflation rate in 16 years.
Olivier Jakob of Petromatrix in Switzerland said there had been a “very strong correlation” between rising oil prices and the weakening dollar in the last few months, which appeared to have been broken at the start of this week.
“Monday and Tuesday crude oil managed to move ahead without the help of the dollar,” Mr. Jakob said. “But once we broke above 1.59 euros per dollar and as we move toward 1.60, there's going to be more buying coming into oil.”
Analysts said growing investor demand for commodities — which have performed better than other financial instruments — also helped prop up prices.
“This is really driven by investors purchasing oil because returns have simply outpaced those of stocks and bonds,” said Victor Shum, an energy analyst with Purvin & Gertz in Singapore.
Mr. Shum said he didn't think supply and demand fundamentals were that strong, but added that “oil's price rise seems unstoppable.”
Oil's recent run above $100 a barrel has been largely attributed to a steadily depreciating U.S. currency because a weakening dollar prompts investors to seek a safe haven in hard commodities such as oil and gold.
Traders were awaiting the release of U.S. government data later Wednesday on the state of America's petroleum supplies. Last week's EIA report showed an unexpected drop in crude inventories, which started oil on its way to several records.
The U.S. Energy Information Administration was expected to report later in the day that crude inventories grew 1.5 million barrels last week, according to a survey of analysts by Platts, the energy research arm of McGraw-Hill Cos.
Gasoline inventories were expected to decline 2 million barrels, to post their fifth consecutive weekly drop amid increasing demand for the fuel, the survey showed.
“Implied gasoline demand typically starts to increase at this time of year, but high prices at the pump and a slowing U.S. economy appear to have dented the pace of demand growth,” the Platts report said.
Analysts also projected a 1.7 million barrel drop in distillate stocks, which include heating oil and diesel, while refinery utilization rates were expected to jump 0.9 percentage points to 83.9 per cent.
“The market may choose to focus on the expected product drawdowns and interpret the report as bullish,” Mr. Shum said. “But product inventories in the U.S. are at healthy levels. The declines would simply be because refinery utilization operating rates have not been strong, and that's because refiners are responding to weak demand.”
Crude prices were also supported by reports of a number of supply disruptions.
Attracting the most attention was the closure of Mexico's three main oil-exporting ports on the Gulf Coast because of bad weather that started Sunday. Only one of the ports remained closed Tuesday, according to Mexico's Communications and Transportation Department.
In other Nymex trading, heating oil futures added 2.61 cents to $3.3000 a gallon while gasoline prices rose 0.65 cent to $2.8875 a gallon. Natural gas futures were up 7.5 cents to $10.280 per 1,000 cubic feet.
© Copyright The Globe and Mail

CRO Receives Exceptional Nickel Recoveries from Recent Testwork

Canadian Arrow Mines Receives Exceptional Nickel Recoveries from Recent Testwork
08:21 EDT Wednesday, April 16, 2008

SUDBURY, ON, April 16 /CNW/ - Canadian Arrow Mines, Ltd. (CRO: TSX-V) (the "Company") is pleased to provide an update on the metallurgical test-work program underway on ores from the Kenbridge Nickel Project in Northwestern Ontario. Xstrata Process Support (XPS) of Sudbury, Ontario recently completed a series of variability tests as part of the Phase 1 program to verify and optimize the flotation circuit for Kenbridge. Results of the open circuit cleaning and rougher flotation test-work indicate high recoveries of nickel and copper at saleable concentrate grade can be obtained from the lower grade, open pit Kenbridge ores.
<<
Cleaner stage flotation results: 2 stage cleaning with CMC, Kenbridge
open pit
-----------------------------------------
Ore grade - Ni, Cu % 0.42%, 0.19%
-----------------------------------------
Nickel recovery 83.3%
-----------------------------------------
Copper recovery 91.2%
-----------------------------------------
MgO content 2.3%
-----------------------------------------
Combined Ni/Cu grade 11.0%
-----------------------------------------
>>
The open circuit recovery of 83.3% nickel is a marked improvement on the 72% used for the low grade open pit ore in Arrow's recently published Preliminary Economic Assessment study, (Feb. 28, 2008). These preliminary flotation tests have produced saleable bulk nickel/copper concentrate grades with an exceptional upgrade ratio for nickel of 18:1 which highlights the potential of the Kenbridge deposit. These test results were performed in an open circuit and as such are un-optimized. Improved efficiencies and further gains in metallurgical response are being explored by the XPS team in the form of rougher concentrate regrind and locked cycle tests.
<<
Rougher stage flotation results (variability tests): Kenbridge
-----------------------------------------------------
% Ni % Cu Ni recovery % Cu recovery %
-----------------------------------------------------
3.20 1.39 97.7 98.2
-----------------------------------------------------
1.66 1.39 97.7 98.9
-----------------------------------------------------
1.27 0.39 94.1 97.8
-----------------------------------------------------
0.83 0.24 92.8 92.7
-----------------------------------------------------
0.75 0.56 88.9 98.2
-----------------------------------------------------
0.47 0.45 92.0 96.6
-----------------------------------------------------
0.43 0.22 88.7 97.9
-----------------------------------------------------
0.42 0.19 92.3 86.5
-----------------------------------------------------
0.29 0.22 83.5 96.1
-----------------------------------------------------
0.29 0.14 78.9 81.0
-----------------------------------------------------
0.16 0.18 78.3 92.8
-----------------------------------------------------
>>
Kim Tyler, President of Canadian Arrow Mines, comments "We are very pleased with the results of the XPS flotation work and look forward to the final results from the locked cycle tests. These nickel and copper recoveries are well above historical results for low grade ores and will have a positive impact on the economics of the open pit and bulk underground resources at Kenbridge. The XPS metallurgical program will continue over the next few months to further optimize these reported results, test the flotation response of higher grade underground ores and determine the design parameters for the grinding circuit - all key requirements for the upcoming bankable feasibility study."
About Canadian Arrow Mines, Ltd.
Canadian Arrow Mines, Ltd. is an established Canadian exploration and development Company committed to developing and advancing base metal deposits close to existing infrastructure through exploration, development and acquisition. Shares of Canadian Arrow Mines trade on the TSX Venture Exchange under the symbol "CRO".
If you would like to receive press releases via email please contact: sarah@chfir.com.
THIS PRESS RELEASE WAS PREPARED BY MANAGEMENT WHO TAKES FULL
RESPONSIBILITY FOR ITS CONTENTS.
THE TSX VENTURE EXCHANGE NEITHER APPROVES NOR DISAPPROVES OF THIS PRESS
RELEASE.
%SEDAR: 00008534E
For further information: visit the website at www.canadianarrowmines.ca, or call toll free, 1-877-262-6354, or contact: Canadian Arrow Mines, Ltd.: R. Kim Tyler, P. Geo, President, Tel: (705) 673-8259, E-mail: kim@canadianarrowmines.ca; CHF Investor Relations: Barry Leung, Tel: (416) 868-1079 ext. 247, E-mail: barry@chfir.com; or Sarah Gingerich, Tel: (416) 868-1079 ext. 238, E-mail: sarah@chfir.com

PDP On the Move Today Aonymous Accumulation

Up is down, down is up

Tuesday, April 15, 2008

Clearly, the stock market is in one of its moods. Johnson [amp]amp; Johnson, which reported strong first-quarter results on Tuesday morning and raised its forecast for the year – bucking an early trend toward disappointment at the start of the earnings season – fell in early trading. But investors can't seem to get enough financial stocks.

The Dow Jones industrial average, rose 66 points, or 0.5 per cent, to 12,368. Johnson [amp]amp; Johnson fell 0.5 per cent.[amp]nbsp; JPMorgan Chase [amp]amp; Co. rose 2.4 per cent, Citigroup Inc. rose 2.2 per cent and Bank of America rose 1.9 per cent.
And, just to make things even weirder, General Electric Co. – which put the fear of a disastrous earnings season into the minds of investors last Friday – rose 0.9 per cent.

In Canada, the focus was once again on commodity producers, with gold up strongly and crude oil hitting a new record high. Gold rose to $936.70 (U.S.) an ounce, up $8.20. Oil rose to $113.33 a barrel, up $1.57. The commodity-heavy S[amp]amp;P/TSX composite index rose 91 points, or 0.7 per cent, to 13,830.

EnCana Corp. rose 1.8 per cent, Canadian Natural Resources Ltd. rose 1.9 per cent and Barrick Gold Corp. rose 1.8 per cent. The commodity producer that everyone is watching these days – Potash Corp. of Saskatchewan Inc. – rose 1.6 per cent, putting it well on its way to an 11th consecutive gain. Meanwhile, the Big Banks were mixed, a contrast to the United States, where financials were in high demand.

Why an $11 book costs $50 on eBay

Why an $11 book costs $50 on eBay
TheStar.com - Business -

April 12, 2008 Ellen Roseman

John Sacke got a surprise when he bought an item online at eBay for $27.99 (U.S.).
After charging it to his PayPal account, linked to his CIBC Visa card, he got a message from PayPal saying he would pay $29.92 in Canadian dollars.

Just after his email arrived, I heard from Ray Ho with a similar complaint. Not only did PayPal convert his eBay purchase into Canadian dollars, but he found an extra markup once he checked his credit card statement.

If you check PayPal's website, you can find information about its fees for Canadian users.
Here's what it says about currency conversion:

"The exchange rate is the retail foreign exchange rate as determined by PayPal at the time a transaction is completed. The exchange rate is adjusted regularly, based on market conditions, and includes a 2.5 per cent fee above the rate at which PayPal obtains foreign currency. The 2.5 per cent fee is retained by PayPal. This fee only applies when PayPal performs the currency conversion."

You're usually given the choice of using PayPal's currency conversion or your credit card company's conversion.

So, check with the credit card issuer to see whether it has a foreign exchange fee – most do – and whether it's less than 2.5 per cent.

The other difference is that when PayPal converts the currency, you can see the rate at the end of your transaction.

If you were making a U.S. dollar purchase yesterday, you would have seen PayPal's rate as $1.05 (Canadian) for $1 (U.S.).

If you don't use PayPal's conversion, you won't know how much you will be charged until you check your credit card statement.

Is there a way to avoid such fees? I had to track down someone in San Jose, Calif., to get an answer.

"PayPal customers have the ability to add a U.S. bank account to their Canadian PayPal account," says Sara Gorman, a spokesperson for PayPal, which is owned by eBay.

"So, if a Canadian customer wants to make a payment in U.S. dollars, there would be no currency exchange fee for payments originating from a U.S. dollar account."

Just in case you're confused by the last sentence, she's saying you have to open a bank account in the United States – not a U.S. dollar account at a Canadian bank.

If you buy occasionally at eBay, you may find it's not worth the trouble. But check with your Canadian bank to see if it's affiliated with a U.S. bank and if it can help.

Personal note: As an occasional eBay buyer, I made a winning bid last month on a 1,000-page book, How to Cook Everything Vegetarian by Mark Bittman.
I won it for $11 (U.S.), compared to the Canadian list price of $41.99.

My glee disappeared when I got an invoice from the seller, located in Michigan, for $47.70 (U.S.).
That included shipping and handling via U.S. first class mail ($26.20) and shipping insurance ($10.50).

I asked the seller if there was a cheaper way to ship the book and she said no. "All of this was explained in the listing," she said.

I hadn't seen any such details – and if I had, I wouldn't have bid for the item. But not wanting to get negative feedback, I went ahead.

My cookbook arrived last week, packaged beautifully. The final bill was $50.31 (Canadian) after using PayPal's currency conversion.

The lesson: Always ask about shipping costs to Canada. And find a local source if you can, especially for heavy items.

Professor Randy Pausch

Carnegie Mellon Professor Randy Pausch, who is dying from pancreatic cancer, gave his last lecture at the university Sept. 18, 2007, before a packed McConomy Auditorium. In his moving talk,

The close: TSX is in the money

The close: TSX is in the money

RTGAMChampagne corks were popping on Bay Street on Thursday afternoon after
the SP/TSX composite index closed at 13,909.58, up 159.03 points, or 1.2 per cent. The gain put the benchmark index above water for the year - by 0.6 per cent. That's the first time it has been in money-making territory since Jan. 3. Let the good times roll!The TSX twins - Research In Motion Ltd. and Potash Corp. of Saskatchewan Inc. - were again the biggest two drivers behind the push to profitability, rising 2.4 per cent and 1.7 per cent, respectively.But the index was actually firing on all cylinders, with all 10 sub-indexes contributing to the gains.

The utilities sub-index was the biggest winner, thanks to TransAlta Corp.'s 5.9 per cent gain. Meanwhile, MDA Corp., whose deal to sell its satellite unit to Alliant Techsystems Inc. was scuttled by Ottawa, fell 8.5 per cent, making it the single biggest drag on the index.In the United States, technology stocks were all the rage after reports connected Microsoft Corp. to News Corp., and Yahoo Inc. to Time Warner Inc.'s AOL unit. Intel Corp. rose 3.1 per cent and International Business Machines Corp. rose 1.7 per cent. As for Microsoft and Yahoo, the two tech companies in the midst of a takeover dance, their stocks rose 0.8 per cent and 3 per cent, respectively.

The Dow Jones industrial average closed at 12,581.98 up 54.72 points or 0.4 per cent. The broader S[amp]amp;P 500 closed at 1360.55, up 6.06 points or 0.5 per centnbsp;Copyright 2001 The Globe and Mail

Worst from credit crisis yet to come: Soros

Worst from credit crisis yet to come: Soros

Associated Press

April 10, 2008 at 4:27 AM EDT

SHANGHAI — The credit crisis is far from over, billionaire financier George Soros warned Thursday, urging regulators to move faster to contain damage from the collapse of the housing finance markets.

“I think the situation is more serious than the authorities admit or recognize,” Soros told journalists in a conference call. Measures taken so far to slash interest rates and stimulate the economy were “necessary but not sufficient,” he said.

“Because of that, I think the situation is going to get worse before it gets better.”
Mr. Soros is promoting a new book, “The New Paradigm for Financial Markets: The Credit Crisis and What It Means.” He has urged regulators to move more aggressively to improve market oversight to curb risks from excessive reliance on debt for financial speculation.

He said he agreed with the International Monetary Fund's estimate of more than $1-trillion in losses linked to the collapse of mortgage-backed securities.
Losses disclosed by financial institutions so far are related only to the decline in value of those financial instruments, Mr. Soros said.

“They do not reflect in any way a possible decline in the value of the loans held by the banks,” he said. “We have not yet seen the full effect of the possible recession.”

Mr. Soros pointed to the potential for massive losses from complex investments linked to the U.S. subprime mortgage market, such as credit default swaps, or CDS, which allow investors to put bets on the likelihood that companies will default on bond payments.

He described as a “Sword of Damocles” the $45-trillion worth of credit swaps.

“That's more than five times the entire government bond market of the United States. It's almost equal to the entire household wealth of the United States,” Mr. Soros said.

“This $45-trillion market is totally unregulated,” he said.

Credit crunch losses will top $945-billion: IMF

Credit crunch losses will top $945-billion: IMF

HEATHER SCOFFIELD
Tuesday, April 08, 2008

Ottawa — The International Monetary Fund is pegging the losses related to the global financial crisis at $945-billion (U.S.), and warns that the side-effects of the credit problems will be harsh.
“It is now clear that the current turmoil is more than simply a liquidity event, reflecting deep-seated balance sheet fragilities and weak capital bases, which means its effects are likely to be broader, deeper, and more protracted,” the Fund says in its Global Financial Stability Report, released Tuesday morning.

The IMF issues the report twice a year to assess the fragility of the state of global finances. The April report raises the alarm, warning central banks and financial institutions that they should prepare for the worst.

“Notwithstanding unprecedented intervention by major central banks, financial markets remain under considerable strain, now compounded by a more worrisome macroeconomic environment, weakly capitalized institutions, and broad-based de-leveraging,” states the report, issued just days before central bankers and finance ministers meet in Washington for their bi-annual meetings which are expected to focus on how to resolve the crisis.

The increased strain on the global financial system is coming from a simultaneous deterioration of credit quality, a drop in valuations given to structured credit products, a market liquidity drought and the ongoing de-leveraging in the financial system.

“The critical challenge now facing policy makers is to take immediate steps to mitigate the risks of an even more wrenching adjustment, including by preparing contingency and other remediation plans, while also addressing the seeds of the present turmoil,” the IMF paper warns.

The estimate of potential losses at $945-billion is on the pessimistic side, but is not outrageously high. More pessimistic analysts have pegged total losses at well above $1-trillion when all is said and done.

Still, the IMF warns that the losses may circle back to hurt financial institutions in a second round of effects, especially as monoline insurers run into trouble. Plus, the risk of litigation is growing, the report warns.

While the United States remains the “epicentre” of the crisis, the spillover effects to other industrialized countries is major. The IMF warns that industrialized countries with inflated house price levels, as well as stretched corporate and household balance sheets.

The Bank of Canada has repeatedly pointed out that in Canada, corporate and household balance sheets are remarkably healthy, and financial institutions are well capitalized.

However, analysts are watching house prices closely for signs of bubbles. And the central bank is moving to set up new liquidity functions in case the credit crisis takes more direct aim at credit conditions and solvency in Canada. Until now, however, the main effects of the global credit crunch have been in the form of tighter credit and a slower economy, especially for Canada's non-commodity exports.

The head of the IMF, Dominique Strauss-Kahn, said this week that the need for government intervention in credit crisis is becoming more evident, but the Global Financial Stability Report steered clear of such sensitive issues. Rather, it stuck to suggestions for private-sector action and urged central banks to devise ways to stabilize the financial system without increasing moral hazard and fiscal costs.

In question is whether the rescue of investment bank Bear Stearns, led by the U.S. Federal Reserve last month, was a one-time event, or just the beginning of a string of major financial institutions hovering on the brink of insolvency. The debate will likely dominate the spring meetings of the IMF and Group of Seven this weekend.

© Copyright The Globe and Mail

The Grandich Letter

Point + Figure Charts TIM,FNI,CRO,PDP,BWR

For A More Indepth Explanation Of P+F Charts Click Here

Pescod Talks PDP +CLL

The close: 2009 is looking good

Thursday, April 03, 2008

On Thursday, investors took a break from worrying about big picture stuff involving the health of the U.S. economy and instead focused on stock-specific stories, from stellar individual earnings to takeover rumours to plain old rebounds.

The Dow Jones industrial average closed at 12,626.03, up 20.2 points or 0.2 per cent. Alcoa Inc. rose 5.8 per cent after the aluminum producer was the subject of takeover speculation. Merck [amp]amp; Co. Inc., which had been hammered earlier in the week, rose 3.4 per cent after investors bet that it had been punished too severely. And General Motors Corp. rose 3 per cent after CSM Worldwide forecast that U.S. auto sales would recover slowly but steadily in 2009 – a welcome relief for anyone fearing the sector was doomed forever.

The broader S[amp]amp;P 500 closed at 1369.31, up 1.78 points or 0.1 per cent. Schering-Plough Corp. which had been battered along with Merck [amp]amp; Co. rebounded 11 per cent, and Ford Motor Co. rose 5.4 per cent. On the downside, Cisco Systems Inc. fell 2.9 per cent.
In Canada, the S+P/TSX composite index closed at 13,551.29, up 37.15 points or 0.3 per cent. But you can pin the gains on two big movers: Research In Motion Ltd. and Potash Corp. of Saskatchewan together contributed 41 points. Meanwhile, Bombardier Inc. rose 6.3 per cent after its strong earnings were released in the morning and BCE Inc. rose 1.5 per cent.

Report says oil stocks still cheap

Report says oil stocks still cheap

TheStar.com - Business - Report says oil stocks still cheap

Values poised to rise as higher commodity prices are factored in, bank economist says
April 03, 2008 Madhavi Acharya-Tom YewBusiness Reporter

Energy stocks still haven't factored in the value of $100 (U.S.) per barrel for oil, and that may be a hidden opportunity for investors, the chief economist for CIBC World Markets said in his latest research report.

That's among the reasons Canadian investors don't need to run for cover from the U.S. economic slowdown, economist and chief strategist Jeff Rubin wrote.

"Although even a modest U.S. recession would ordinarily be a sign for investors north of the border to hunker down, we do not believe that a shift to a completely defensive posture is as warranted today as it might once have been," according to Rubin's monthly ``Canadian Portfolio Strategy Outlook'' report, released yesterday.

Rubin has a year-end target of 14,500 points for the S&P/TSX composite index and he thinks it will hit 16,200 by the end of 2009.

That means the TSX would continue to beat the U.S. S&P 500 index with a return of 7.7 per cent this year and 14.1 per cent in 2009.

The stock market strength will come from mostly the energy and materials sector, which has been driving most of the gains for the past five or six years, Rubin said.

"I think we're going to see new all-time highs in the energy and materials sector, particularly the energy sector."

That's despite the recession in the United States, Rubin added.
While some economists say the slowdown south of the border will dampen demand for oil and commodities, Rubin pointed out prices are already at record highs, despite the current economic turmoil, largely because of massive demand from Asia.

"The U.S. isn't as decisive to those markets as it once was," Rubin said.
These higher commodity prices aren't being fully reflected in energy stock valuations, he said.

"In oil stocks, for example, they're pretty well pricing in $75 oil and oil is over $100."
Look for stock prices to rise as the remaining increase is factored in, he added.
Rubin's model portfolio is "overweight" in energy and material stocks, he said in his report. He said he expects firm prices for a range of commodities as supplies remain stretched for many minerals and industrial metals.

He said he remains "overweight" in bonds as well, expecting a 1 percentage point cut in interest rates by the U.S. Federal Reserve this year and a reduction of three-quarters of a percentage point by the Bank of Canada.

Rubin is "underweight" in financials, and he is expecting more asset writedowns resulting from the U.S. subprime mortgage market. U.S. commercial banks start to report their earnings in the third week of April, "raising the spectre of a further deluge of writedowns, which could affect valuations on both sides of the border," Rubin stated.

"Some Canadian banks now have significant stakes in U.S. banking."

He said he also believes gold's recent retreat to below $900 an ounce will be temporary, given the weak U.S. dollar, worries about inflation and more interest rate cuts by the U.S. Fed.

"I think gold is going to recover," Rubin said. "I think the Fed still has quite a bit more interest rate cuts to do, and in an environment of rising U.S. inflation, I think that's probably going to see gold top $1,000 an ounce."

Rubin and his team of economists see a "modest" downturn in the U.S. economy, with signs of recovery starting to show in the second half.

Still, Rubin believes Canada will be able to avoid a recession.

"Parts of the Canadian economy, like southern Ontario, are going to be affected, but I don't think the Canadian economy as a whole is going to see a recession," he said.

PDP 1st Q=considerable growth

Petrolifera Petroleum's Argentinean estimated sales volumes show considerable growth during first quarter 2008

cnwCALGARY, April 2 /CNW/ - Petrolifera Petroleum Limited (PDP - TSX) announced today it continues to grow and reestablish its solid production and sales base in Argentina. During March 2008, the company's estimated sales volumes rose approximately 40 percent from January levels to reach an estimated 9,000 boe/d. Petrolifera's March 2008 estimated exit sales rate was approximately 9,300 boe/d, of which approximately 85 percent was represented by crude oil and natural gas liquids sales and the balance was natural gas sales.

Sales volumes reported herein have been estimated based upon available information and may differ from reported sales volumes which will be based on actual sales receipts.Petrolifera's estimated monthly sales volumes for the first quarter 2008 were January - 6,460 boe/d; February - 8,290 boe/d and March - 8,975 boe/d.

The estimated daily average sales rate for the first quarter 2008 was approximately 7,900 boe/d, an increase of twelve percent over fourth quarter 2007 levels.

Readers are cautioned that a barrel of oil equivalent (boe) is derived by converting natural gas to oil in the ratio of six thousand cubic feet of gas to one barrel of oil and that this may be misleading, particularly if used in isolation. A boe conversion is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Production and consequent sales volumes in January were affected to some extent by the installation of new water treatment and waterflood facilities but showed excellent improvement throughout the remainder of the quarter, aided by successful new infill drilling as detailed herein.

The current level of production and sales does not yet in any measurable manner reflect the activation of the company's recently installed waterflood at Puesto Morales Norte. Petrolifera anticipates it will be later in 2008 before the initial impact of the waterflood will be discernible and the company does not expect the full impact to occur until the second half of 2009.

It is anticipated there will be increasing stability in Petrolifera's base production and sales volumes once the waterflood is optimized.During the first quarter 2008,

Petrolifera drilled or initiated drilling of 16 wholly-owned wells at Puesto Morales/Rinconada, resulting in eight oil producers, two water injectors, one gas producer (PME x-1001 - currently on a sustained production test through a ten millimeter choke at a rate of approximately 1.8 mmcf/d from the Loma Montosa Formation), two wells waiting on completion, one drilling well, one preparing to drill on the company's Rinconada Block and one dry hole.

The company's best new well was PMN a-1081, which tested over 1,000 bbl/d of light gravity Sierras Blancas crude oil and is now onstream contributing to the company's much improved sales.

Follow-ups to this well are anticipated.The company expects to drill its second exploratory well on its 100 percent-owned Puesto Morales Este block during April 2008 and plans an aggressive evaluation and drilling program on the balance of its extensive Argentinean acreage position during the balance of 2008.

Petrolifera is currently operating with two drilling rigs and two service rigs on its Argentinean acreage.

Detailed financial and operating results for the first quarter 2008 will be released to the public on May 8, 2008, which is also the date of the company's Annual General Meeting, to be held in Calgary, Alberta at 3:00 P.M., MT, at the Calgary Petroleum Club.Petrolifera Petroleum Limited is a Calgary-based crude oil and natural gas exploration and production company with its principal producing asset at Puesto Morales Norte in the Neuquen Basin onshore Argentina.

It also holds extensive exploratory rights and plans drilling activity in Colombia and onshore Peru, where it is conducting an extensive 2D seismic program on block 107 in the Ucayali Basin in preparation for the anticipated drilling program.FORWARD LOOKING INFORMATION:This press release contains forward-looking information, including but not limited to future exploration and development plans and the anticipated timing associated therewith, anticipated production growth from planned capital programs, current production, recently drilled wells and the recently activated waterflood, anticipated productivity of certain recently drilled wells and follow-up potential to the PMN a-1081 exploratory well.

This information is based on current expectations that involve a number of risks and uncertainties, which could cause actual results to differ materially from those anticipated. These risks include, but are not limited to risks associated with the oil and gas industry (e.g. operational risks in development, exploration and production delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections in relation to production, costs and expenses and health, safety and environmental risks), the risk of commodity price and foreign exchange rate fluctuations, the uncertainty associated with negotiating with foreign governments and risk associated with international activity.

There can be no assurance that flow rates established on the sustained production test of the PME x-1001 will be maintained when this well is placed onstream. Additional risks and uncertainties are described in the company's Annual Information Form for the year ended December 31, 2007 which is filed on SEDAR at www.sedar.com.Due to the risks, uncertainties and assumptions inherent in forward-looking information, prospective investors in the company's securities should not place undue reliance on this forward-looking information. Readers should review the risk-factors set forth in the company's Annual Information Form for the year ended December 31, 2007, available at www.sedar.com, for a detailed description of the risks and uncertainties facing the company. Forward looking information contained in this press release is made as of the date hereof and are subject to change.

The company assumes no obligation to revise or update forward looking information to reflect new circumstances, except as required by law.For further information: Richard A. Gusella, Executive Chairman, Petrolifera Petroleum Limited, Phone (403) 538-6201, Fax: (403) 538-6225, inquiries@petrolifera.ca, www.petrolifera.ca© 2008 The Globe and Mail

Looking back the letters A- N represent significant events that have taken place back to
Feb 15 2008. Feb 29th we saw a price of $12.50.

Petrolifera Petroleum "buy," target price reduced
03/19/08 - Jennings Capital

NEW YORK, March 19 (newratings.com) - Analysts at Jennings Capital maintain their "buy" rating on Petrolifera Petroleum Ltd (P9P). The target price has been reduced from C$17.40 to C$16.50.In a research note published yesterday, the analysts mention that the company's operating costs rose in 4Q on account of lower-than-expected volumes. Petrolifera Petroleum’s cash flows in 2007 were adversely impacted by higher-than-expected taxes, the analysts say. The company’s FD&A costs in the year were higher than the 2005/2006 level partly on account of higher-than-expected facility capex, Jennings Capital adds.

Petrolifera Petroleum rises on reserves increase.

Posted: February 26, 2008, 4:07 PM by David Pett
Energy
Petrolifera Petroleum Ltd. shares were up more than 10% on Tuesday after reporting increased reserves in 2007.

The company said proved resources increased 43% from 10.5 million barrels to 15.1 million barrels of oil, while proved and probable reserves increased 10% from 19.5 million barrels to 21.5 million barrels of oil.

The biggest material increase was in the proved probable and possible reserves category which was not evaluated in 2006. For 2007 the company reported these reserves reached 33.4 million barrels.

The huge short activity will result in PDP exploding up on the next significant news release.
The shorts will have to cover their position fast, since the float is small 50 Million shares, and the current volume at these levels is 22-28,000 shares per day, which is a joke.

Bernanke: Recession possible

Bernanke: Recession possible

JEANNINE AVERSA

Wednesday, April 02, 2008

WASHINGTON — Federal Reserve Chairman Ben Bernanke warned Wednesday the U.S. economy may shrink over the first half of this year and “a recession is possible.” Yet, he didn't offer any assurances of further interest rate cuts.
Bernanke's testimony to the Joint Economic Committee was a much more pessimistic assessment of the economy's immediate prospects amid a trio of crises — housing, credit and financial.

“It now appears likely that gross domestic product (GDP) will not grow much, if at all, over the first half of 2008 and could even contract slightly,”

Mr. Bernanke told lawmakers.

GDP measures the value of all goods and services produced within the United States and is the best barometer of economic health. Under one rule, six straight months of declining GDP would constitute a recession.

Still, Mr. Bernanke said he expects more economic growth in the second half of this year and into 2009, helped by the government's $168-billion (U.S.) stimulus package of tax rebates for people and tax breaks for businesses, as well as the Fed's aggressive reductions to a key interest rate. Nevertheless, the chairman acknowledged uncertainty about the Fed's next steps, notwithstanding the mounting economic woes.

“Much necessary economic and financial adjustment has already taken place, and monetary and fiscal policies are in train that should support a return to growth in the second half of this year and next year,” Mr. Bernanke said.

To try to limit the damage, the Federal Reserve has aggressively cut a key interest rate, now at 2.25 per cent, to spur buying and investing by individuals and businesses. At the Fed's last meeting in March, however, two members dissented from the Fed's decision to sharply cut rates, showing a rare division in the often unified front the Fed shows the public. The dissenting officials, who had reputations for being extra concerned about inflation, favoured a smaller reduction. Although Mr. Bernanke said he hopes inflation will moderate in coming quarters, he acknowledged high energy prices have clouded the inflation outlook.

Many economists had predicted the Fed might drop its key that rate again when it next meets April 29-30, although Mr. Bernanke's remarks cast some doubt on that scenario.
On Wall Street, stocks initially dropped after the Fed chief's remarks but later turned slightly positive.

Housing, credit and financial woes are threatening to push the country into a deep recession. The situation has emerged as a top concern for presidential contenders and a hot-button issue for Congress. It has thrust the White House and the Fed in crisis-management mode.
Faced with mounting home foreclosures and job losses, Mr. Bernanke has been under immense political and public pressure to provide relief and help turn around a faltering economy.
Committee Chairman Sen. Charles Schumer, D-N.Y., peppered Mr. Bernanke with questions about the Fed's moves to aid once mighty Wall Street firm Bears Stearns and then juxtaposed that with — what he believed was a lack of help — to millions of people at risk of losing their homes.

“I hope that you will use your position to jawbone this administration to get behind the housing relief effort before Congress.” Mr. Schumer said. “Addressing the housing crisis head-on will do as much to instill confidence in the markets as lowering interest rates or bolstering regulatory oversight of wayward mortgage lenders and financial institutions. We need to do all of it.”
“Wall Street has been helped. Now it's time to help Main Street,” added Rep. Carolyn Maloney, D-N.Y.

Many private analysts believe the economy contracted in the first three months of this year, signaling the start of a recession. The government releases first-quarter results later this month. The economy lost jobs in January and February, with many economists bracing for more losses when the report for March is released Friday. Mr. Bernanke said he expected unemployment to move “somewhat higher in coming months.”

“Clearly, the U.S. economy is going through a very difficult period,” he told lawmakers, adding that all the problems have weighed heavily on consumers whose spending is indispensable to economic vitality.

The Fed also has taken a series of extraordinary steps in recent weeks and months to prop up the nation's financial system, which has been in state of high jeopardy.
In a controversial move, the Fed backed a $29-billion lifeline as part of JPMorgan's deal to take over troubled Bear Stearns, the nation's fifth largest investment house. Bear Stearns had invested heavily in risky mortgage-backed securities that eventually soured with the collapse of the housing market.

Mr. Bernanke defended the move. “With financial conditions fragile, the sudden failure of Bear Stearns likely would have led to a chaotic unwinding of positions in those markets and could have severely shaken confidence,” he said.

“The damage caused by a default by Bear Stearns could have been severe and extremely difficult to contain.”

Although the taxpayers are on the hook for the $29-billion, Mr. Bernanke said he was “reasonably confident we'll be able to recover the full amount.” He also said that Bear Stearns' investments that the Fed took control of “are entirely investment grade.”
In addition, the Fed — in the broadest use of its credit authority since the 1930s — agreed to temporarily let big investment firms obtain emergency financing from the Fed, a privilege that previously had been granted only to commercial banks.

Those actions have prompted criticism from Democrats and others who contend that the Fed is bailing out Wall Street and putting billions of taxpayers' dollars at potential risk. Mr. Bernanke and the Bush administration argued that the actions were warranted to avert a potential meltdown in the entire financial system, something that would have devastating consequences for the overall economy.

Asked about the Bush administration's plan to revamp the country's creaking financial system, Mr. Bernanke said it was vital for the Fed to have sufficient enforcement powers. Under the plan, the Fed would become a top cop in charge of financial market stability but would lose its day-to-day supervision of U.S. banks.

© Copyright The Globe and Mail