(MONDAY 14TH NOVEMBER - JAMES GERRISH - 7.52am)...The DOW JONES had a strong session Friday adding +259pts while the S&P 500 finished up +1.95%. European mkts were all higher (FTSE up +1.85%, German DAX up +3.22%, French CAC up +2.76%) while locally, the SPI FUTURES mkt is pricing a higher open up +44pts when trading kicks off here this morning.
On Friday, the S&P/ASX 200 added +52pts or +1.24% to close at 4296.
DOW JONES - it was meant to be a quite session Friday given it was Bank Holiday and the Bond mkt was closed however better than expected Consumer Sentiment data and approval of the new austerity plan in Italy was enough to get investors excited. The Italian 10 year bond yields dropped sharply settling at 6.42% after hitting 7.5% on Wednesday. We also had Berlusconi make way for Mario Monti who has a strong financial background which the mkt clearly liked. For an overview of Monti, CLICK HERE
S&P/ASX 200 - A strong day on our mkt Friday particularly in the last hour of trade. We think the mkt will continue higher towards year end but we're more inclined to buy into shocks rather than chase rallies. Although we've got positive developments from Italy, we've been here before. As soon as Greece got their house sort of in order, focus turned to Italy. Now Italy has made positive moves, I think we'll start to hear more about the time table of the US Super Committee - the panel created under the debt ceiling deal earlier this year.
The panel has until November 23 to reach an agreement on at least $1.2 trillion in deficit reduction over the next decade. If it works out an agreement, Congress must vote on the unamended plan by December 23. Failure to reach an agreement or gain approval by Congress and President Barack Obama would trigger significant automatic spending cuts scheduled to take effect in 2013.
We saw back in August the massive divide between political parties in the US which ultimately led to the downgrade of the US credit rating. The US has been extremely vocal about European leaders taking action so it will be incredibly interesting to see how the US approaches these upcoming negotiations.
The optimist would have to argue that the divisive actions that occurred on both sides of politics in August serves as a warning that such action can't occur again - there needs to be some type of bi partisan result and from a mkts perspective it will be essential for this rally to continue.
As with any political negotiation, there will be days when headlines are negative and as we said above, its probably better to be a buyer on these days.
A TRIBUTE TO BERLUSCONI - SOME CRACKING QUOTES IN HERE...! Well worth a read.
Italian Prime Minister Silvio Berlusconi is famed for making his views known in blunt, colourful, sometimes combative language.
At times he strays into what one of his predecessors, Massimo D'Alema, described as "planetary gaffes".
Here is a selection of quotations from Mr Berlusconi on a range of topics over his years in and out of office.
On Italy's debt crisis
Speaking on 13 August 2011, as he announced a raft of new austerity measures: "Our hearts are bleeding. This government had bragged that it never put its hands in the pockets of Italians but the world situation changed. We are facing the biggest global challenge."
But on 4 November 2011, he told a news conference at the end of a G20 summit: "The life in Italy is the life of a wealthy country: consumptions haven't diminished, it's hard to find seats on planes, our restaurants are full of people."
Scandals over his private life
Mr Berlusconi - caught in a series of scandals over his private life, including his alleged dealings with younger women and prostitutes - has frequently turned to a pithy phrase in an attempt to shrug off the allegations.
For instance, in April 2011, he said: "When asked if they would like to have sex with me, 30% of women said, 'Yes', while the other 70% replied, 'What, again?'"
At the end of the previous year, as allegations swirled about escorts and "Bunga, bunga" parties, the PM deadpanned the line: "I unfortunately have never in my life been to a wild party."
However, the talk of scandal has got under his collar at times.
He told Il Giornale newspaper in an interview on 12 August 2009 that he had nothing to apologise for and no skeletons in his cupboard: "I deserve to be left in peace: enough violations of privacy."
Questioned on the sex allegations in late July, Mr Berlusconi admitted: "I am not a saint, you've all understood that."
In an earlier interview with gossip magazine Chi, Mr Berlusconi denied he pays for sex, adding: "I never understood where the satisfaction is when you're missing the pleasure of conquest."
More bluntly, in November 2010 Mr Berlusconi hit out with the following: "It's better to like beautiful girls than to be gay."
Battles with the courts
On the news in October 2009 that Italy's constitutional court had overturned a law granting him immunity from prosecution while in office:
"Lucky that there's Silvio, otherwise we'd be completely in the hands of these gentlemen of the left... I will defend myself in the courts, exposing the accusers to ridicule, showing all Italians what stuff they're made of and what stuff I'm made of."
Earlier, he insisted that the charges against him were farcical and that his administration would "govern for five years with or without the law".
His view of Italy's judiciary in June 2008: a "cancerous growth".
On judges pursuing former Prime Minister Giulio Andreotti on charges relating to the Mafia: "Those judges are doubly mad! In the first place, because they are politically mad, and in the second place because they are mad anyway.
"If they do that job, it is because they are anthropologically different from the rest of the human race."
Politics and the Italian Left
In November 2011, facing the biggest crisis of his leadership, he said: "I want to look those who want to betray me in the face."
As a spat with his former wife hit the papers in late April 2009, Mr Berlusconi rebuffed her accusations that his party planned to field attractive young women as European election candidates: "We want to renew our political class with people who are cultured and well prepared... [Candidates standing for my party would be unlike the] malodorous and badly-dressed people who represent certain parties in parliament."
He is quoted as saying on 9 April 2008: "The left has no taste, even when it comes to women."
On left-wing voters at a conference of retailers during the 2006 campaign: "I trust the intelligence of the Italian people too much to think that there are so many pricks around who would vote against their own best interests."
Promising to put family values at the centre of his campaign for the April 2006 general election: "I will try to meet your expectations, and I promise from now on, two-and-a-half months of absolute sexual abstinence, until [election day on] 9 April." He later insisted the pledge was "just a joke".
On Mussolini
"Mussolini never killed anyone. Mussolini used to send people on vacation in internal exile."
In the wake of 11 September
"We must be aware of the superiority of our civilisation, a system that has guaranteed well-being, respect for human rights and - in contrast with Islamic countries - respect for religious and political rights, a system that has as its value understanding of diversity and tolerance...
"The West will continue to conquer peoples, even if it means a confrontation with another civilisation, Islam, firmly entrenched where it was 1,400 years ago."
His response to worldwide condemnation of the above speech: "They have tried to hang me on an isolated word, taken out of context from my whole speech."
"I did not say anything against the Islamic civilisation... It's the work of some people in the Italian leftist press who wanted to tarnish my image and destroy my long-standing relations with Arabs and Muslims."
On his alleged conflict of interest as prime minister and one of Italy's biggest tycoons, with major media holdings: "If I, taking care of everyone's interests, also take care of my own, you can't talk about a conflict of interest."
President Obama's skin colour
Of Barack Obama, upon his election as US president in November 2008, he said: "[Mr Obama is] young, handsome and suntanned".
His response to the wave of criticism following the remark: ''God save us from imbeciles... How can you take such a great compliment negatively?"
An unabashed Mr Berlusconi rehashed the jibe on his return from the G20 summit in Pittsburgh on 28 September 2009: "Ah, Barack Obama. You won't believe it, but the two of them sunbathe together, because the wife is also tanned."
The L'Aquila earthquake
In general Mr Berlusconi won praise for his handling of an earthquake that hit central Italy on 6 April - except for his advice to homeless survivors that they should see their plight "like a weekend of camping."
Women
In September 2010, speaking at a youth rally, saying women should marry rich, older men: "Women are lining up to marry me. Legend has it, I know how to do it."
In January 2007, Mr Berlusconi was forced to issue a public apology to his wife, after she accused him of flirting with two women.
"If I wasn't already married, I would marry you right away," Mrs Berlusconi accused him of telling women at a TV awards dinner.
"With you, I'd go anywhere," he was quoted as telling another woman.
On Italian secretaries (comments made at the New York Stock Exchange): "Italy is now a great country to invest in... today we have fewer communists and those who are still there deny having been one. Another reason to invest in Italy is that we have beautiful secretaries... superb girls."
On himself
After his immunity from prosecution was lifted by the Constitutional Court in October 2009, he declared:
"I am without doubt the person who's been the most persecuted in the entire history of the world and the history of man."
"In my opinion, and not only mine, I am the best prime minister we can find today."
Previously, on the same theme: "I am the Jesus Christ of politics. I am a patient victim, I put up with everyone, I sacrifice myself for everyone."
"The best political leader in Europe and in the world."
"There is no-one on the world stage who can compete with me."
"Out of love for Italy, I felt I had to save it from the left."
"The right man in the right job."
"I don't need to go into office for the power. I have houses all over the world, stupendous boats... beautiful airplanes, a beautiful wife, a beautiful family... I am making a sacrifice."
Yet by May 2010, he appeared in a chastened mood when he told a news conference at the Organization for Economic Cooperation and Development in Paris: "As prime minister, I have never had the feeling that I was in power."
To a German newspaper:
"In Italy I am almost seen as German for my workaholism. Also I am from Milan, the city where people work the hardest. Work, work, work - I am almost German."
Other politicians
In June 2005, on enlisting the support of Finnish President Tarja Halonen for Italy to host the European Food Safety Authority: "I had to use all my playboy tactics."
Mr Berlusconi added insult to injury by saying that he had had to "endure the Finnish diet", such as smoked herrings.
To German MEP Martin Schulz, at start of Italy's EU presidency in July 2003: "I know that in Italy there is a man producing a film on Nazi concentration camps - I shall put you forward for the role of Kapo (guard chosen from among the prisoners) - you would be perfect."
During the controversy raging over the above remark: "I'll try to soften it and become boring, maybe even very boring, but I am not sure I will be able to do it."
At the Brussels summit, at the end of Italy's EU presidency, in December 2003: "Let's talk about football and women." (Turning to four-times-married German Chancellor, Gerhard Schroeder.) "Gerhard, why don't you start?"
On his first meeting with Danish Prime Minister Anders Fogh Rasmussen in 2002, Berlusconi complimented him with the words: "Mr Rasmussen is not only a great colleague, he's also the best-looking prime minister in Europe."
On Aids
A joke about Aids told by Mr Berlusconi: "An Aids patient asks his doctor whether the sand treatment prescribed him will do any good. 'No', the doctor replies, 'but you will get accustomed to living under the earth'."
His response to critics who said the joke was offensive: "They have lost their minds; they really have come to the end of the line, indeed they have gone beyond it. I would advise them, too, to undergo sand treatment..."
MODEL PORTFOLIO UPDATES
No updates this morning
AUSTRALIAN DUAL LISTED STOCKS
In New York, News Corp rose by US$035 to US$17.60, equivalent to A$17.12, A$0.06 above its last close on the ASX.
ResMed rose by US$0.25 to US$28.04, equivalent to A$2.73, A$0.02 below its last close on the ASX.
In London, Rio Tinto rose 48.5 pence to £34.68, A$0.76 higher in Australian currency terms.
BHP-Billiton rose 35.5 pence to £19.92, A$0.55 higher in Australian currency terms.
Henderson Group Plc rose 4.8 pence to £1.17, A$0.07 higher in Australian currency terms.
