Why Is It So, page-3

HIG is in the same boat as many stocks on the ASX. And I think its because of Australia's economic situation. We are experiencing the tail end of an out-of-control housing boom in the big capital cities. If you have property, you're in debt up to your eyeballs (hoping that interest rates don't go up). If you are renting, you're wages are being stripped bare. If you are a rich professional, you've gone in hard for your 10th property with a wacking great debt to avoid taxes. So it doesn't leave much room for buying shares. If you want proof, just look at retail sales bumping along the bottom, wages frozen for 3 or 4 years, and work becoming more and more casualised. If it wasn't for the recent period of good iron ore and coal prices, Australia would be in a recession already. And as it stands, the about face on "debt and decifit disaster" by the treasurer and his team-mates, is a dramatic demonstation that the economy is spent and a major downturn will occur unless there is a stimulus.
So how does this relate to HIG, and many other good small caps? Pensioners, Mum and Dad investors, as well as retail investors can't consider going back to the small-cap stock market at the moment. (Probably the only stocks they may be interested in are the ones that pay dividends.) But hopefully that will change when the housing bubble bursts. Then there may be a rapid reassessment by investors, and hopefully the big money may come looking for bargains. If so, the long suffering punters may be in a good position, but only if we have been able to hold onto good stocks. On the other matter, the dispute by PanAust with the directors is causing so much trouble and uncertainty. I hope you're right Dogon, and there is a solution to the Frieda problem. We are due for a break from hostilites. The good news is that the improved cobalt price looks like it will carry Ramu and Sewa along like a freight train in the forseeable future. The price of HIG these days is going up and down by +5% on very thin trade, so it is really meaningless. I'll now hand over to someone else to give their views.