"Government Accused of Smoke and Mirrors Over Bank Rescues" - a great headline spotted this morning! The reference is to the fact that due to a statistical "anomaly" (a very convenient one) the UK treasury can fiddle the budget deficit by counting operating profits from the failed banks as a "plus" while NOT counting all the losses/bailout cash as a "minus". Ho ho ho. And the reason for calling it a "great" headline? Lloyds has just appointed as its "senior independent director - whatever that might mean - the chairman of British American Tobacco...so at least we know where the above - mentioned smoke comes from!

And speaking of these losses, Lloyds has just had to dump about £74bn of (HBOS generated) mortgage - related toxic loans into the UK taxpayer's "guarantee scheme" - 20% of their total mortgage book!

Anyway, moving along - lots of wee snippets today, in no particular order - and first, it was amusing to note that the AIG board (proud owners of the biggest quarterly loss in US corporate history) have told the Obama one that they're "obliged" to pay out hundreds of millions of dollars in 2008 bonuses, but they will "use their best efforts" to reduce those for 2009, by "up to 30%". Now being a simple country boy, IW may be missing something here, but isn't 70% of "several hundred million dollars" still quite a lot of payment for abject failure? And isn't it the US taxpayer who will be shelling out? Clearly the Yank "man/woman in the street" is as compliant and uncomplaining as his or her UK counterpart.....Baaa, baaa.... will people ever wake up? But the Broon/Obama offensive on these nasty tax havens seems to be having an effect - while enjoying a wee rant over dinner the other night with a British garage -owning friend who's over here for a few days, he pointed out that "at least SOMETHING is being done about all this terrible tax evasion". Smoke and mirrors indeed! The estimated total extra tax that the USA and Blighty would raise if all "tax havens" were closed down, is about £185bn a year according to the OECD. My goodness - that's nearly enough to pay for 25% of the bailout costs for at least one bank! And if "action" causes economic hardship for (say) the Cayman Islands as jobs there vanish, won't UK Plc (ie the taxpayer) be obliged to send them some "overseas aid"? The Broon one is pretty big on that kind of thing after all. No, as far as this guy is concerned, the "shut down all the tax havens" nonsense is just that - nonsense - but it makes for great soundbites by politicians. And my friend is like most folk - he WANTS to believe "something is being done to help overcome the economic crisis" - perfectly understandable of course, given that he has a couple of main dealerships in the UK and has already had to "let go of some staff" as he puts it. When you think about it, businesses that operate internationally will ALWAYS find a "favourable" tax regime - they don't need "tax havens" as such. Look at Brit Insurance in the UK - or more accurately now, "not in the UK" - they have moved head office to the Netherlands - not a country generally considered as being any kind of tax haven, surely! And several UK businesses have their HQs in Dublin for tax reasons - RSA is about to move there too. Plus, if you are a VERY rich individual, your tax levels will be tiny if you want them to be, no matter how much Big Brother tries to spoil the party. A message from IW to the Broon & Obama comedy act - use your energies somewhere that might be more effective - ie nowhere.

Speaking of Broon & Obama, didn't you just love the gift given by the latter to the former the other week, after THE speech? A whole 25 DVDs. Gosh. And given the Obama one's commitment to free trade, probably sourced from Thailand at a cost of at least $12.50. Probably there will be lots of cartoons in the set - the Broon one will be watching Alice in Wonderland, while the Mandelson person meantime prefers Postman Pat. Doubtless too, members of the house of commons could learn a bit from studying The Simpsons. Give me a good bit of violence every day - Tom & Jerry would be the IW choice. (The originals - not the watered down PC rubbish version.)

Anyway, moving rapidly along before you begin to think I'm a bit of an intellectual - it seems the Russian government has just made a massive error of judgement. They're sending banking representatives to the UK to "learn how to deal with the financial crisis." Oh dear. The G20 certainly chose the wrong date for their fancy, ineffectual meeting - surely the 2nd of April is a day late?

Ireland's central bank chief says its economy is going to "shrink by 6%". Interestingly, he didn't say "during 2009" - probably he means "every month in 2009."

Next, "Fail in the City, become a teacher in 6 months" could be the wording for the current advert anent teacher training vacancies. Get "fastracked" into teaching and become a head teacher within 4 years. What nonsense. Sure, there are many rubbish teachers still "out there" doing harm, but PROPER teachers don't become such in 6 months - that idea is just plain insulting. The three Cattles directors who have been suspended anent alleged "accounting irregularities" will be retraining as maths teachers then.....not to mention those at Resolution Ltd. (FSA investigation ongoing.)

And the UK's Financial Services Authority has just announced it is going to "clamp down on risky mortgage lending" - they must be watching the Dr Who DVD surely, and trying to invent a time machine? And other "ill timed" pronouncements came from both the IMF and the World Bank - "The world economy will shrink in 2009." It's still amazing to this guy, just how utterly inane are statements that emanate from "the authorities." It was ever thus.

Speaking of "authorities", it appears that Charlie Windsor is in a bit of bother with the Advertising Standards Authority over claims he's making about the efficacy of his "Duchy Detox" potion. Maybe it doesn't actually work that well? You can't trust anyone these days......speaking of which, what do you reckon about the report that says over 1000 serving UK police officers have criminal records? If that is true, it's surely a case for total (and justified) outrage? It certainly reinforces my own total distrust of cops everywhere.

Finally today, mention was made the other week that California has deferred payment of tax refunds because it has nae money to pay them - now we see that 26500 teachers there, along with 15000 janitors and admin staff, have been handed "layoff notices". That doesn't mean they will all lose their jobs, but many will do so, because the education budget is to be cut by $8bn. Not good.

Anyway, on to a chart or two, and today we'll look first at that of The Restaurant Group, where a "falling wedge" seems to have formed. Then we'll see how the earlier triangle on the chart of Next Plc is developing. Finally we'll see how the German Dax Index fell out of its triangle and has now retraced to meet the 25 DMA. Where next for this one?

And that's all for this weekend - wall to wall sun & snow plus two hours left of the skiing day means IW has now left the building!

A couple of things to note - there will be no WICS next weekend (22nd March) because of family visiting for a skiing long weekend, and mentoring replies will be limited (at best) between Thursday lunchtime (19th) and Monday lunchtime (23rd). If you can simply "hold" emails between these dates it would be greatly appreciated. It's also worth pointing out (especially to those of you who don't really "know" me yet) that these past few months, mentoring responses have been pretty rapid. That has been entirely due to the weather - there has been a massive amount of snowfall this winter and most of my skiing has involved only the odd couple of hours here and there, or just an afternoon at a time. Don't get too used to rapid replies overall!

OK, on that note - happy trading till we speak again on 29th March then! (There will be video updates though on Wednesday 18th, and the next ones after that will be on Wednesday 25th.)

Ian.

'IMPORTANT NOTICE: These WICS charts are for EDUCATIONAL PURPOSES ONLY. They represent only MY understanding of what is happening in the market for any particular share, stock, commodity or index. In NO circumstances should they be construed as recommendations to trade. If I choose to trade what I see, that is MY decision. YOU must, in turn, come to YOUR OWN conclusions about what action, if any, YOU might choose to take'.