Morning,(Still not good)
Last night we got a perfect storm of negative influences…’Zombieland’ ,China slowing and Moody’s downgrading banks across the board…it feels that in the land of the blind the one eyed man is king!If all the banks get downgraded does it matter…or are these ratings agencies just a sideshow..I mean they still haven’t downgraded Spain !!SPI down 53 and Aussie dollar off a cent…Gold whacked and Oil at 78 bucks a barrel…peak oil is a memory!
Anyway the news was all bad and the SPI will test 4000 again…so much for my theory of a go at 4200…we may see a little more to the downside in the next few days..yesterday there was a couple of sell portfolios around and that was enough to completely stuff our market and once again apathy rules! We will get no sustained rallies at all until the Zombie’s finally wake up and realise that they need to fix their problems…they still are in that river in Egypt!
Corporate Australia is covering itself with glory at the moment..a few months ago Ted Kunkel, the Chairman of Billagonebang, said that they did not need to raise money..and guess what? yesterday they raised a huge amount at a massive discount..Gordon Merchant who started the Bong is now rueing the day that he knocked back private equity and their bid..Ted did such a great job at Fosters if you remember as well…if he did the CEO sleep out I would leave him there! Poor old BBG shareholders will have no choice but to take up the rights or be diluted massively…not much fun.I have enclosed some research on Billagonebang…background more than anything but maybe once the rights issue settles down it may be time to have a better look at them..
In other news Gold and Silver got slammed last night as Uncle Bens’s reluctance to crank up the presses disappointed all them gold bulls..don’t worry it won’t take long to get them cranking!!It will have to happen.
Our banks will get hit early but they are paragons of virtue compared to their overseas buddies…good yields, strong business models in a glowing economy ..what’s not to like…they will come back and then should be good buying at around 5% of where they are now! Also may get a chance to buy TLS at some stage…still like this one..lots of ads at the moment telling everyone how good they are..must be a lot of people whose two year plans are up and looking to switch to best network!
Probably best to avoid resource companies just at the moment…nothing good is coming out of China!
Things that make me go oouch!!
1.The VIX had a big night last night up to over 20 again with a 16% rally!
2.QAN are out to scare the government with reports that if Emirates take on more Virgins they will be in danger of going down the Swanny! It’s hard to compete with Sovereign airlines!
3.Spain on the verge of a bailout ..didn’t they have a lite one a few weeks ago..I get confused!IMF has come out and said that Europe needs to be fixed..genius..
4.Clive James is nearing his terminus..such a great shame and so sad..
5.Greece issues its new demands through Bloomberg…they couldn’t even afford one terminal…but they want to retract cut to minimum wage and no further cuts for 13/14…
6.Paul Keating calls Moaning Merkel ‘intellectually limited and she is taking the whole world down’ and Tony Abbott a “Obstructionist Capuchin”..bring back Paul I say!
7.Fotescue challenges the MRRT in the high court!!Interesting good to see Twiggy keeping the lawyers busy..much like the Rinehart cowboy!
8.US jobless numbers weak …Phily Fed Index below recession levels..housing numbers soft…and there’s an election soon in the US.
9.Four way summit in Rome on Friday when Italy ,Spain and France all gang up on Germany and try to get Mertle to see sense!!unlikely..little less talk a little more action..
10.Portugal knock out the Czech Republic..into the semis..they at last have something to smile about.
Once again the focus will shift to the walking dead as yet another talk fest begins in the next week and they will undoubtedly come out with some major motherhood statements about strong support for ‘Zombieland’ but they are only words and words are all I have to take your heart away!
I continue to believe that any rallies are to be sold until Europe gets serious…some commentators have suggested that will not happen until they have their Lehman’s moment and realise that it is serious..luckily the Pollies don’t live in the real World at all and we can be assured of more jetting about talking to each other for some time to come..its gonna be a long summer in Zombieland!
Thought for the day
Did you know that dolphins are so smart that within a few weeks of captivity, they can train people to stand on the very edge of the pool and throw them fish?
And for those that are Douglas Adams fans..’so long suckers and thanks for the fish!’
Have a great weekend
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