Well, here we are at the last WICS of May - doesn't time just fly by when you're enjoying yourself! (It's also the last WICS of all of course, for those of you who haven't renewed your sub after the expiry of your initial no - cost three months' worth - if you haven't received notification of that fact, then you will doubtless be receiving the new password over the next day or two, effective 31st May. Please double check your junk folder, just in case!) Anyway, to those of you who are not planning to continue suffering these weekly ramblings, I wish you well - and you will be welcome to 'come back' at any time of course!

The other "admin" point to note is that the TTEW workshop on 21st June is now fully subscribed. Everyone concerned should have received either an email from me by now, or a letter from the publisher, with the relevant details. I look forward very much to meeting those of you who are attending.

Anyway, what's "new" this week? Not an awful lot, it has to be said. Grumpy Gordon still believes he can "steer the UK economy through the stormy times ahead" - although from his own point of view as ship's captain, navigation is getting harder and harder and the "Crewe" has mutinied......(Sorry - but that one was irresistible.) Oh well, he'll find somebody to blame for sure. Maybe it was the tracing paper he put over the chart ten years ago and never removed. (You'll doubtless have heard that one by now - if not, it refers to £5m of damage caused to a nuclear submarine that hit the seabed - after its navigation officer failed to read the chart accurately because it had been covered by tracing paper to stop people writing on it.......) Gordon's trouble is that he was totally happy to go along with the consumer boom that was driven by rising house prices, and he put nothing away for a rainy day despite all his protestations to the contrary - indeed he too borrowed and spent as though there were no tomorrow. His "Golden Rule" is now right out the window for sure. Either he genuinely believed he had put an end to "boom and bust" or he was a far weaker figure than anyone might have thought during his tenure of No. 11 Downing Street. Market economies will ALWAYS have booms followed by busts - it's the nature of the animal. Why so? Because markets are driven by EMOTION, nothing more complex than that. The sheep get an idea in their woolly wee brains and off they go, either euphoric that the world is a great place and prices can only keep rising - "boom" - or suddenly scared that something might go wrong, so they talk themselves into pessimistic mode and start looking for the downsides in what they had bought during the "boom" phase. Naturally, they find plenty to be scared of, because in the boom, they were sold so much total rubbish by the "wolves" (to continue the "sheep" analogy) that when they do finally wake up and start thinking a little, they realise that their "wealth" maybe ain't all it was cracked up to be - property valuations of course being the prime example at the moment - so panic sets in and what is the result in due course as the flock changes direction and charges back downhill at high speed? "Bust" - obviously! Last summer, one day all in the garden of toxic waste was still rosy, and the next day, that which had been valued at "rather a lot" was all of a sudden perceived as potentially worthless by the markets. I refer to CDOs in the USA (Please use the WICS search engine: "toxic waste" will give you a thread to track back.) Now the point is that yesterday for example, a piece of paper sold by a mortgage company to a bank, and sold on by that bank to a municipal pension fund, was perceived to be "worth" $110m. That's what the pension fund had been prepared to pay for what was perceived as being a "totally solid" investment. But today, because some clever clogs gave the matter some thought and said "Ah, but what if some of these mortgages are not repaid by the underlying borrower - ie the homeowner.....?" All of a sudden, people started worrying and asking pointed questions - the questions they should have been asking BEFORE they wrote the cheque after the fancy lunch. And that kind of feeling gathers momentum, so that well before the general public realised, those in the know were jumping ship as fast as they could - selling THEIR potentially worthless toxic waste to the Moms and Pops for as much as they could get for it. Once the media got hold of the story, the "bust" phase of Western economies had begun because by then the sheep were in possession of some of the facts and for sure, THEY are going to keep right on panicking for some time to come! A gross oversimplification? - of course - but not that inaccurate either. And as mentioned in these ramblings in the past, very few so -called "fund managers" and "financial advisers" are long enough in the tooth to understand what the "bust" phase of the economic cycle actually means. They'll find out now! I guess to summarise, when times are good, very few people (only the cynics - like this fella Williams) ask searching questions and conduct "due diligence" before committing money to something. It's not until times start to get bad that the nasty stuff surfaces - at which point the sheep start bleating that "THEY should do something" - whoever "they" might be. Too late, folks!

Anyway, onward - and it seems that the HSBC AGM next Friday will see some fireworks in some kind of "shareholder revolt" against the altered remuneration packages I mentioned last weekend. Dream on - votes on shareholder "revolts" always seem to be about as honestly run as the elections in Zimbabwe. Glaxo paid £2.5m to an exec to "stop him leaving" and you could have heard the cries of outrage in Harare - yet the vote still came out in favour of the deal. Shell is paying £800000 each to three execs who failed to get the top job, again to stop them leaving. Again, the shareholder outcry served for nothing. And Joe Public STILL buys their shares! Baaaa.... Methinks "scam" and "big business" are words that are entirely interchangeable.

On the subject of scams, it seems that a "miracle cure" for dyslexia is being touted at only £2000 a pop. Cheep att arf the pryse. (And lest you think I'm laughing at dyslexia, let me just say that two of our children are dyslexic and it's not funny. Anyone claiming a miracle "cure" should be locked up as far as I'm concerned. Our two are not that disadvantaged of course, and are doing well in their careers - but that's not the case for everyone.)

And this "Fairtrade" thing gets me going too - it's a company and a brand, for goodness' sake. It's not the saviour of all the poor third world producers. It's just more "big business" and it's causing a whole lot of grief to other third world organisations by successfully persuading too many in the west that it's somehow the ONLY way to be ethical when buying coffee etc. The "Green Tesco" of the planet perhaps? Grrr....

Staying with scams - if any of you good people happen to work for the Marks & Sparks directors' benefit society, could you please let them know that their liquorice allsorts are a complete con? Daughter Number One sent us one of her occasional Red Cross parcels the other day - you know the kind of thing - stuff that civilised folks simply cannot do without. Brazil nuts for example. (Amazingly unobtainable in France!) Decent tea. Liquorice allsorts. But please, Stuart Rose - a bit more "liquorice" and a whole lot less "coconut"! Am I the only person in the world who likes the former but detests the latter? I'll bet it's a whole lot cheaper to stuff the packets with coconut but it's the last time I'll be seeking them out.

Moving along before you become convinced of Williams' insanity, it was amusing to note Boris' comment regarding the Olympics budget - "I will be examining ways to rein in the costs..." Boris, to rein in a runaway horse, first you have to catch it........And I note that the Aquatic Centre (mentioned here last weekend) is not only massively over budget, but despite being a Paralympics venue - and with a 17500 capacity, it has provided just two lifts for the disabled. Maybe we should be pleased it wasn't only the one lift then?

Oh yes, and maybe the UK taxpayer will have a bit of a long wait to see a return on the Northern Wreck "investment" carried out by the Brown one on your behalf - anent comments above about "due diligence" it seems that the new chief exec has finally woken up to the fact that the debt can only be repaid if clients somehow redeem their mortgages - generally via a remortgage away from NR. And that if nobody else wants them as customers...........you get the idea. Maybe they'll all win the lottery. Hey - that could be the answer! - Gordy, fix the lottery so that everybody can win £120 a year. Then you won't need to find the £2.7bn Nantwich & Crewe bribe every year from now on. Gosh, I'll bet YOU wish you had thought of that one!

Oh yes - while I remember, a person on the Bank of England's Monetary Policy Committee suggested during the week that "Recession is not the most likely outcome (of the credit crunch) but it can't be dismissed." A month or two behind the times then......

Time for me to find some horizontal deckchair support methinks - but first, a chart or two. We'll take a look at Cattles, because there's some nice horizontal support there, along 180 - and way back in April 2000, 170 was the lowest it reached - we'll see if that matters too. Then, in the opposite direction, we'll see how the trend changed on the UK Coal chart and what then happened - and I'm delighted to note how many of you had asked about it at the start of this month! Next, there's a wee look at Informa, to compare with UK Coal - and we'll see too how the downtrend took the form of a channel - just out of passing interest because it's the potential trend change that matters. (If you're new to these ramblings, please use the WICS search engine for more about these terms - ie "channels", "trendlines" etc.) Finally we'll update the FTSE100 chart. Will prices rise again or is this (at long, long last!) the start of the "big drop"?

OK- that's all for this weekend (or for good, of course!). I'm off now to pen a letter to Golden Brown, offering him my lottery idea in return for a sirhood - or preferably first dibs on the lottery numbers - and I'll see you again here next weekend as usual. (Please note I'll be away from late Wednesday evening after I've done the video updates, till some time on Saturday afternoon, so I won't be replying to emails between these times).

All the best

Ian.

PS - in sending out the new password, many bouncebacks have already happened, as they always do. PLEASE double check your email "housekeeping" per my webmaster's excellent instructions which you'll find on this link. There are much better solutions to email than Hotmail or Yahoo accounts as these often block mail as a matter of course and have restrictions placed on them. Google's free googlemail accounts are found to be superior. Go to http://mail.google.com/mail/signup for an account.

'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'.