Yesterday, MQG completed a $500m capital raising at $73.50 (a 2c discount to the previous day's close)

Yesterday, MQG completed a $500m capital raising at $73.50 (a 2c discount to the previous day's close). Compare this to the discounts investors demanded when optimism was a distant memory: CBA 2008-raised $1.65bn @ $26, a 12% discount. MQG 2009-raised $540m @ $27, a 22% discount. WPL 2009-raised $2.5bn @ $42,10 a 9.4% discount. The market's confident of the future than during the dark GFC days, with the $US10Tln of Central Bank stimulus arguably the main contributor. I believe the Central Banks still have not succeeded in stimulating world growth, but have created a bond-bubble that will need incredible efforts to avoid a harmful burst. In the short term, I believe the stimulus/free money will continue to inflate asset prices and the ASX200 can easily see the 6200 area. MQG is perceived to be perfectly-positioned at present, with corporate activity increasing, aided by the near-zero-cost of money. The only factor that investors must remember is that you cannot forecast MQG's earnings with any large degree of confidence, it's more of a macro-environment play and low-interest-rates, plus asset inflation are positive conditions for a merchant bank. (VIEW LINK)