THE DISTILLERY: Milked fame

Pot luck at the breakfast table this morning. A lot of different subjects covered by the jottery. Easter and Anzac Day approach, a long, long weekend, with eggs, buns, footie (rain, no doubt), fish and fun. The high life. But it's also a big week for updates, from retailing to mining stocks, with some early earnings from March 30 balancing companies and of course, the usual drone and moan of politics and business life.

The Australian Financial Review says: "Treasurer Wayne Swan is to press ahead with significant cuts to government spending despite growing evidence of weakness in the domestic economy." And the paper also said: "NSW Premier Barry O'Farrell will dramatically increase public scrutiny of infrastructure planning by setting up a major projects advisory body and promising to release cost-benefit analyses for big developments."

Fairfax's Adele Ferguson says financing infrastructure projects is a running sore in Australia: "Leighton's $4.2 billion Airport Link road project and Victorian desalination plant and the collapsed RiverCity Motorways are part of a growing list of public private partnerships that have torched billions of dollars of private sector money in the past decade due to cost overruns and poor risk management. It is not hard to see why: certain big projects get up because there are a lot of people with vested interests. To make the project look viable these people underestimate costs, overestimate revenues, undervalue environmental effects and overvalue regional development effects. With such disasters, both sides of politics will need to make a lot of changes to the way public private partnerships are structured to rebalance the risk if they are to entice the private sector to keep bankrolling road projects."

The Australian's Nabila Ahmed says: "the market is again mulling an old question: a potential tie-up between Transfield and rival UGL to create a large-scale engineering services company. It's been a year since reports of informal discussions between the two parties and the Easternwell acquisition makes things a little more difficult. However, the whisper is that UGL boss Richard Leupen may be keen to revisit the situation if there was a way to carve out Easternwell – which would inflate the takeover price for Transfield."

The Australian's David Uren wrote from Sydney this morning: "A deal among G20 finance ministers to boost the International Monetary Fund's scrutiny of the seven biggest economies has failed to ease concerns about global economic recovery, which have pushed the gold price to a record of almost $US1500 an ounce. As International Monetary Fund and G20 meetings ended in Washington yesterday, markets were rattled by reports that the fund believed Greece had no alternative to default and of inflationary surges in China and India." And higher than expected inflation in Europe, while America's core inflation was lower than expected.

The Fairfax broadsheets report this morning that: "Australian businesses are caught between hope for the economy and fear for their companies, with the mining boom weighing heavily on the minds of manufacturers, according to a report. The Ernst & Young Capital Confidence Barometer, released today, is based on a global survey of more than 1000 executives by the Economist Intelligence Unit, conducted between February and March this year. The biannual report shows respondents from Australia and New Zealand feel less optimistic about the prospects for their businesses, despite more saying access to finance is ''not an issue'' and credit conditions have improved."

Michael Pascoe wrote on smh.com.au yesterday strap yourself in: "CFOs also tend to be a little more truthful than CEOs, more likely to stick to the hard numbers than waffle. And that makes a Deloittes survey of CFOs all the more important. The latest quarterly survey is embargoed until tomorrow, but I can tell you that it shows most CFOs believe that now is a good time to take more risk. That hasn't been the case for the past 12 months. The Deloittes survey confirms the Australian Bureau of Statistics December quarter figures on private fixed capital expenditure – what business is investing and is intending to invest. For all the downbeat corporate commentary around, the CFOs were quietly telling the ABS that they are planning a capital expenditure boom in the next financial year." And this morning The AFR wrote: "Prime Minister Julia Gillard is facing new pressure from big business to dump the current approach to negotiations with big emitters over a carbon price and agree to fully offset its impact on their operations." We're going survey and poll crazy.

And the Fairfax broadsheets also reported that: "The recovery hoped for in business lending is unlikely this year, with the country's biggest lender indicating the ''engine drivers'' of economic growth are hanging on to cash rather than borrowing it. Although the next round of lending data from the Australian Prudential Regulation Authority is not due for a fortnight, the Commonwealth Bank's comments suggest the boost in business credit experienced in February is likely to be ''modest'' for the rest of the year." Ahhh, not another survey!

This morning the Fairfax broadsheet business pages note that another situation is in trouble with shareholders: "Shareholders have threatened legal action against the rare earths miner Lynas over the proposed sale of a polymetallic resource to Forge Resources which has raised conflict of interest concerns. The Lynas executive chairman, Nicholas Curtis, a director and 15 per cent shareholder of Forge, stands to vest 24 million in Forge performance shares worth $30 million if the deal succeeds. In a letter to Lynas obtained by BusinessDay, the law firm Turner Freeman, acting for shareholders Surpion Pty Ltd, Aliana Pty Ltd and Daleford Way Pty Ltd, claimed that information made available to Lynas shareholders, including an explanatory memorandum and a notice of an extraordinary general meeting had been misleading."

And Sydney Morning Herald journalist Stuart Washington wonders what happened to the other person in a Sydney insider trading case: "A young Sydney stockbroker, John Joseph Hartman, went to jail on insider trading charges for four-and-a-half years last December. Since then, by all reports, his one-time best friend Oliver Peter Curtis has been having a great time. As made clear in Justice Peter McClellan's sentencing, Hartman was the insider trading ''tipper''; Curtis was the insider trading ''tippee''. To elaborate, Hartman as tipper is in jail for an extra 18 months for offences he first appeared in court about in April last year. But Curtis as tippee – the recipient of the tips that Hartman made – has not faced any ASIC court action more than a year after Hartman was charged."

John Durie wrote a good column in The Weekend Australian: "On the same day next week that Coles releases bumper quarterly sales figures, the Senate economics committee is due to table its report on the dairy industry calling for a raft of changes to increase controls on the supermarkets. The timing is exquisite, given Coles boss Ian McLeod has brilliantly exploited milk prices to help re-establish Coles as a price-competitive supermarket. He may have found the political meddling bothersome, but it created advertising that money couldn't buy, with Coles' cheap prices appearing as the lead item on the evening television news." Woolies' third quarter sales figures are out today, and Coles on Wednesday. And The Australian reported this morning that analysts are tipping: "Woolworths and Coles are expected to report a pick-up in sales growth for the third quarter amid higher prices for fresh produce."

And Melbourne's Herald Sun said: "Today, Woolworths will be assembling a nice shelf display showing its third-quarter sales numbers to best effect and giving an important indication of whether consumers are ramping up their weak discretionary spending. In Woolies' case, that will be shown by the performance of their Big W, Tandy and Dick Smith arms versus sales at their core and market-leading Woolworths supermarkets and Dan Murphy's liquor stores. On Wednesday, it is Wesfarmers' turn, as the predominantly retail conglomerate outlines the numbers for its fast-improving Coles supermarkets and also its Kmart, Target, Bunnings and Officeworks businesses."

The AFR also reminds readers: "Given that this week brings quarterly reports from BHP Billiton and Newcrest Mining, investors could be forgiven for forgetting about Australia's soft commodities sector." It says there's renewed interest in Graincorp.

Fairfax's Ian Verrender says don't hold your breath waiting for credit rating agencies to be held to account over the GFC, there's a long list of misses: "The Asian financial crisis? Missed that one. The dotcom bubble? The agencies all gave the nod of approval to a range of dotcom darlings, including WorldCom, which torched billions of dollars in shareholder funds and where executives found themselves in jail. Were they embarrassed by this debacle? Not on your life. At the time the dotcom bubble was bursting, those same agencies were preparing the ground for the big one, the unfolding disaster in the US housing market. The ratings agencies didn't create the hugely complex debt instruments that seized up the financial system. But they legitimised them, for a fee of course, and then stood back while these worthless instruments were sold to hapless investors around the world."

The Sydney Morning Herald reported that Sydney businessman, "John Kinghorn is preparing to back down from his plan to delist RHG Ltd, the rump of the failed Rams Home Loans business, after influential corporate governance adviser ISS Governance told shareholders to vote against a controversial buyback. But Kinghorn, the RHG chairman, is understood to be pressing on with the buyback at 88 cents, even though it has been heavily criticised for being below the company's own stated asset value of $1.16 per share. Mr Kinghorn's move to keep the company listed is seen as an attempt to take the heat out of a campaign by rebel shareholders led by funds managers Geoff Wilson and Karl Siegling."

The Australian Financial Review reported on Saturday: "From the start of the bid for ASX Ltd by the Singapore Exchange, one person pushed for the deal to be killed as hard as anyone: Tony D'Aloisio, the outgoing chairman of ASIC." And the paper also made a good point in an editorial on the weekend: "The Australian Securities and Investments Commission is right to be looking at prospectuses and how they should contain clearer information but, as with any investment, the buyer should beware." In other words, ASIC can't make the risk go away, no matter what some people might think.

The Weekend Australian reported on Saturday: "Independent expert Grant Samuel has declared a planned spin-off of Tabcorp's casino division is in the best interests of shareholders, but flagged one or both businesses could be a takeover target after the demerger. In a scheme booklet released to the Australian Securities Exchange late yesterday, the independent expert declared the $5.2 billion demerger would enhance the ability of each business to pursue different strategies while increasing management focus on their respective businesses. The split would improve the prospects of Tabcorp shareholders receiving a takeover offer for either the wagering, gaming and keno business (New Tabcorp) or the casinos division (dubbed Echo Entertainment)."