Good morning,

Lots to think about overnight with the Greek Tragedy now giving us some serious déjà vue..more elections, more bailouts, more indecision…more downside to come. In fact, nothing in Europe looks that flash and although people say it’s in the price or it doesn’t matter and that China and the US are the issue..it does matter…if the Euro Zone implodes which looks a possibility at the moment, it will give us another Lehman moment..and we don’t want that.

Club Med looks precarious , at least the issues  with Greek politics has taken the focus off Spain for a while..it will be back..SPI down 24..slide to continue..don’t get brave yet.

If you must look for high yielding fully franked stocks like Banks and TLS but would suggest waiting.

I remain slightly bearish and believe that the Summer in ‘Zombieland’ will throw the World some interesting social, political and economic challenges.

The Budget

Most stockbrokers would be pleased with the budget..the targeting of low and middle income earners will benefit us the most as we all now fall into that bracket!

 

The budget was filled with more magic tricks than a David Copperfield show but targeting the rich and giving money to the poor will help it retain its labour heartland even if it loses everyone else…there have been some suggestions that the 820 bucks that Wayne is giving us will immediately go into retail..suspect it will NOT..maybe the energy bills or insurance bills that keep coming in! Not sure they will stimulate the economy like Gerry Harvey hopes! Disappointment in company tax rate not coming down will pass..and the carbon tax will become the iceberg to the Goverment’s Titanic…

Things that make you go mmm.

1.Swans song at the budget..The Great Magician Swanny is predicting  surplus in 12/13….I am predicting I am gonna win lotto..but neither will happen!

2.ILU got smashed yesterday as they joined the downgrade club..is no one safe!!Start to look at a bounce in them tomorrow perhaps.

3.Oil falling which will help the US gas guzzlers who let’s face it don’t even know where Europe is! Gold smacked last night so expect pain in that sector to continue!

4.RIU Resource conference in Sydney seems to prove how disenchanted the investing public is with numbers of punters well down.

5.Leighton takes another hit of 80m bucks..will it never end!!

6.Lets hope Joe Hockey never becomes Treasurer..that would be truly scary…does this man ever listen to himself..where’s the gong!

7.Zombieland Credit risk surges to four month highs

8.VIX is back to 19..expect it to go higher in the coming days..

9.Fitch ratings agency says budget is strong and flexible..good..that’s a relief

10.If you want to get pessimistic read  Armegeddon scenario ..not much fun….but good to think about..

Remain wary and ensure you have some cash in your portfolio as this market will throw up opportunities..don’t rush!We will see 4200 I believe as the Euro Crisis drags on..if you have any Euros you may want to pop a few in your stamp album for the Grandkids as they will be worth something one day!!!

 

Thought for the day

“Most of us have never lived in normal times.”Anon…

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