March 22nd, 2011 Newsletter

Dear Friends,

Today is the United Nations’ World Day for Water – meant to give us pause to reflect on the importance of this precious resource to our lives.   We are so fortunate to have such abundance and yet our vulnerability was laid bare this week as we watched the nuclear reactors under siege on the Japanese shores of the Pacific Ocean causing inestimable damage.  Today, we learn of a cargo ship which ran aground in the South Atlantic Ocean….the second photo below gives a glimpse of the impact that shipwreck is having.

photos of the day

March 22, 2011

A girl smiles as she carries water from the Ravi river on the outskirts of Lahore. The United Nations’ World Water Day is held on March 22 every year to increase people’s awareness of water’s importance in environment, agriculture, health and trade. Mohsin Raza/Reuters

Three oiled rock hopper penguins on the island chain of Tristan da Cunha. Thousands of endangered penguins have been coated with oil after a cargo ship ran aground and broke up on a remote British South Atlantic territory. The shipwreck also threatens the lobster fishery that provides a livelihood to one of the world’s most isolated communities. Trevor Glass/AP

The Elemental World, a Taxonomy

WATER

Nymph Queen, Landscape Queen: maintain the nature temple

Nymphs, Well Nymphs, and Pasture Nymphs: give individuality to a river, lake, meadow; develop their place into a source of blessing and healing

Nixies: enliven rivers, springs, lakes, and marshes

Undines: energize the sea

Watermen: maintain yang pole

Spirits of Balance: look after balance inside Earth’s crust.

~Marko Pogacnik, from Nature Spirits & Elemental Beings: Working with the Intelligence in Nature

Market Commentary:

Canada

By Cecile Vannucci and Nikolaj Gammeltoft

March 22 (Bloomberg) — Canadian stocks fell for the first time in four days as energy producers retreated and Canadian Pacific Railway Ltd. declined after forecasting earnings below analyst estimates.

Canadian Natural Resources Ltd., Canada’s second-largest energy company by market value, dropped 0.6 percent as energy shares slipped for the first time in five days. Canadian Oil Sands Ltd. lost 1.7 percent. Canadian Pacific, the country’s second-largest railroad, tumbled 2.8 percent. Auto parts supplier Magna International Inc. fell 1.2 percent after Canada reported a decline in retail sales.

The Standard & Poor’s/TSX Composite Index declined 13.70 points, or 0.1 percent, to 14,000 in Toronto.

“What we’re seeing right now is a little bit of pull-back from the last two days,” said Sadiq Adatia, who oversees C$12 billion ($12.2 billion) of assets as Toronto-based chief investment officer at Russell Investments Canada. “We’re due a bit of a pull-back in our economy, and you’re seeing that a in some of the numbers.”

The S&P/TSX gained 3.6 percent from March 16 through yesterday for the biggest three-day advance in more than 10 months, as oil rebounded from its decline following the earthquake and tsunami in Japan. Energy companies make up 28 percent of Canadian stocks by market value, the most among 10 industries.

Crude rose on speculation Japanese rebuilding efforts will bolster fuel consumption and as unrest spread in the Middle East and North Africa. Oil rose 1.6 percent after climbing as much as 2.2 percent.

A group of energy companies fell 0.3 percent. Canadian Oil Sands Ltd., the largest owner of the Syncrude project, dropped 1.7 percent to C$31.49 after rising 2.6 percent the previous session. Canadian Natural Resources lost 0.6 percent to C$48.44 after jumping 1.9 percent yesterday.

Canadian retail sales declined for a second month in January, led by a slump in demand for automobiles, while the country’s leading indicators index rose the most in nine months in February.

Sales fell 0.3 percent to a seasonally adjusted C$37.1 billion ($38.1 billion), following December’s 0.2 percent drop, Statistics Canada said today in Ottawa. Sales were forecast to grow 1 percent in the month, according to the median of 23 estimates to a Bloomberg News survey.

Magna International Inc., the country’s biggest auto parts supplier, fell 1.2 percent to C$48.52. Shoppers Drug Mart Corp., Canada’s biggest pharmacy chain, lost 1.4 percent to C$40.12.

Canadian Pacific Railway, the country’s second-largest railroad, fell 2.8 percent to C$62.71 after forecasting first- quarter earnings of as little as 12 Canadian cents a share, below the 74 Canadian cents per-share analyst forecast.

New Flyer Industries Inc. slid 13 percent to C$10.40, after dropping as much as 14 percent, the most intraday since November 2008. The bus maker reported fourth-quarter sales of C$204.8 million, missing the average of analyst estimates in a Bloomberg survey by 11 percent.

Financial companies gained 0.3 percent as a group. Bank of Nova Scotia, Canada’s third-biggest bank, rose 1 percent to C$59.21. Toronto-Dominion Bank, the Canadian bank that agreed to buy auto lender Chrysler Financial Corp., advanced 0.7 percent to C$84.55.

“They’re a safer play,” said Brian Klock, an analyst at Keefe, Bruyette & Woods. “It’s less of an impact of all the volatility that these global events have on capital market businesses.”

Rare Element Resources Ltd. surged 23 percent, the most since December, to C$12.56 after losing 6.8 percent last week.

Molycorp Inc., a Greenwood Village, Colorado-based producer, said yesterday that rare earth prices were “significantly higher” than anticipated.

Research In Motion Ltd., which said its BlackBerry PlayBook tablet computer will go on sale in the U.S. on April 19, gained 0.3 percent to C$61.14.

US

By Rita Nazareth and Lu Wang

March 22 (Bloomberg) — U.S. stocks fell, sending the Standard & Poor’s 500 Index lower for the first time in four days, as oil rose amid unrest in Libya and concern grew that Europe won’t find an immediate solution to its debt crisis.

Walgreen Co., the largest U.S. drugstore chain, sank 6.6 percent as profit margin fell short of analyst estimates.

Carnival Corp., the world’s biggest cruise-line operator, lost 4.5 percent after forecasting profit that missed analyst projections. Sprint Nextel Corp. rose 2.5 percent after Raymond James & Associates raised its rating. Netflix Inc. added 4 percent as Credit Suisse Group AG lifted its recommendation.

The S&P 500 retreated 0.4 percent to 1,293.77 at 4 p.m. in New York. The gauge had rallied 3.3 percent over the previous three sessions. The Dow Jones Industrial Average declined 17.90 points, or 0.2 percent, to 12,018.63 today.

“We had a number of black swan crises back to back, and that’s always very disconcerting,” Barton Biggs, who helps oversee $1.4 billion as managing partner of Traxis Partners LP, said in an interview on Bloomberg Television’s “Street Smart with Carol Massar and Matt Miller.” “There’s still a couple black swans flapping around out there, but unless you come up with a dire scenario I think we’ll extend the rally.”

Biggs said the U.S. stock market will probably rise back to its 2011 peak from February after the S&P 500 lost as much as

6.4 percent following Japan’s biggest earthquake and as Libya’s Muammar Qaddafi attacked rebels seeking to end his 41 years as the country’s ruler. U.S. stocks rallied yesterday as concern eased that Japan will suffer a nuclear meltdown and after AT&T Inc. agreed to buy T-Mobile USA Inc. for $39 billion.

The S&P 500 today snapped a three-day winning streak, the longest in about a month, as Irish notes slid and oil rose 1.6 percent to $104 a barrel. The slump in Irish notes came after EU finance chiefs settled yesterday on how to enable a permanent rescue fund to lend 500 billion euros ($712 billion) as of 2013, while remaining divided over how to get the current stopgap fund to its full capacity.

“The market is trading on the headlines,” said Tom Wirth, senior investment officer for Chemung Canal Trust Co., which manages $1.6 billion in Elmira, New York. “Things can change from minute to minute. Whenever you get things that are unknown, you start to price in higher risk. Of course, you want to buy at the bottom when the fear is so prevalent in the market. The economic recovery is strong. It’s just that there are too many unknowns right now.”

Global markets are signaling that sustained economic growth will more than make up for Japan’s worst disaster since World War II, rising commodity prices and uprisings throughout the Middle East and northern Africa. Interest-rate derivatives, bond sales by the riskiest borrowers and rebounding benchmark stock indexes all show increasing confidence in the economy.

This year markets have contended with the ouster of Egyptian President Hosni Mubarak, battles between forces loyal to Libyan leader Muammar Qaddafi and rebels, protests in Saudi Arabia, Bahrain and Yemen, oil above $100 a barrel, record-high food costs and a magnitude 9.0 earthquake in Japan that killed more than 8,000 people and crippled a nuclear power plant.

“These events are not going to derail the global expansion,” said Hank Smith, chief investment officer at Haverford Trust Co., which manages about $6.5 billion in Radnor, Pennsylvania. “I’m not sure the risk is over, but the fear of it escalating and getting much worse is subsiding. The big picture remains slightly in favor of equity investors. That is, the economy is expanding, not contracting.”

Manufacturing strength from the U.S. to Germany and China is giving economists more confidence that the recovery from the worst financial crisis since the Great Depression will continue.

Goldman Sachs Group Inc. forecasts a global expansion of 4.8 percent this year, while JPMorgan calls for 4.4 percent. The average over the past two decades is 3.4 percent.

Walgreen slumped 6.6 percent to $39.21. Gross margin, or the percentage of sales left after the cost of goods sold, was little changed at 28.8 percent in the second quarter, Walgreen said. Analysts at Barclays Plc and Citigroup Inc. estimated gross margin would widen at the chain, which operates about 7,700 locations across the U.S. and filled one in five retail prescriptions last quarter.

Carnival fell 4.5 percent to $39.16. The world’s biggest cruise-line operator said it will have fiscal second-quarter profit of 20 cents to 24 cents a share. Analysts surveyed by Bloomberg had estimated 33 cents on average.

Sprint rallied 2.5 percent to $4.47. The third-largest U.S. mobile-phone carrier was raised to “strong buy” from “outperform” at Raymond James.

Netflix gained 4 percent to $221.39. The mail-order and online movie-rental service was raised to “outperform” from “neutral” at Credit Suisse. The share-price estimate is $280.

BJ’s Wholesale Club Inc. rose 5 percent, the most since Feb. 3, to $48.84. Shareholder Leonard Green & Partners said it’s examining an offer for the U.S. membership warehouse chain, reviving its overtures after BJ’s began looking for suitors.

Molycorp Inc. surged 18 percent, the most since Dec. 6, to $52.57. The owner of the world’s largest rare-earth deposit outside China rose as mineral prices increased and concern about the impact of Japan’s earthquake abated. Chief Executive Officer Mark Smith said yesterday that rare earth prices were “significantly higher” than anticipated.

Have a wonderful evening everyone.

Be magnificent!

Such awareness is like living with a snake in the room; you watch its every movement, you are very, very sensitive to the slightest sound it makes.

Such a state of attention is total energy; in such awareness the totality of yourself is revealed in an instant. -Krishnamurti, 1895-1986

As ever,

Carolann

The test of first-rate intelligence is the ability to hold two opposed ideas in mind at the same time and still retain the ability to function.

-F. Scott Fitzgerald, 1896-1940