Morning all,

Mayday celebrations across ‘Zombieland’ last night as people took to the streets to protest against the austerity measures,60 % youth unemployment in some countries is a massive waste of a generation! Meanwhile back in the land of make believe, the US fell nearly 140 points last night as the Fed said they would do more of the same to boost the US economy. Unfortunately it seems the Worlds growth spurt is spluttering. Yesterday we had China disappointing ,we have already had Germany and others in Zombieland disappointing and now the US is slowing as well, not great jobs numbers. Recent profit numbers from US corporates(profits are up a massive 1.1% in the first three months on average!!!) have hardly been brilliant. They have beat expectations but then they were so low anyway that it wasn’t difficult to beat those.So what does this all mean for us down here. I still believe that we will see a period of sideways at best ,down at worse performance until the dust clears in September and we have a new Government. We have Wayne’s Swan song next week which will  be good for a laugh as he tries to wriggle out of his promises and back flip faster than an episode of celebrity Splash. In fact I believe that after his stint as the World’s greatest Treasurer he will be on that show and his specialty will be the belly flop..all done to Bruce Springsteen music….problem is the alternative is Abbott and Hockey…blimey we are in trouble….the present Government have not done too bad a job of things economically but feel that we are poised on a knife edge..the economy can only hold on for so long before it falls into a heap…That Gordon Gretch bloke has a lot to answer for!!!

Expect another down day today with resources and Golds again feeling the pain more than the banks, but the rise in the banks has been pretty meteoric so maybe the gloss is starting to fall off a little bit as investors continue to search for yield…I hear from my source that Rwandan 10 year bonds are yielding 6% if anyone is interested…iBonds from Apple yield 4% for 30 years..good luck with that!!!!! Give me Aussie stocks any day!!!Still think our range is 4850 to 5150/5200 so pullback to around 5000 in the next few months perhaps…sell in May and go away…since 2010 the market has fallen 5.8% in May…which is around 300 points in old money…

Idea of the Day

Everyone loves the banks but maybe it’s time to have a look at your exposure..15 x earnings is getting into growth stock territory and the only growth they have is through cost cutting and bad debts reduction…yields are still good around 5 ish but nowhere near what they were…I am not suggesting you sell all the banks ‘cos that would be silly but maybe a good time to sell calls perhaps and /or trim positions a tad…they have had a great run.

Aussie banks remain the core of any portfolio and will do for the rest of my career ….if you don’t have them in your portfolio then you may get a chance in the next few months to start to accumulate….this is the big market question at the moment..the banks..to be or not to be….ah!!

Things to make me go….Bayern Munich crush Barcelona ..who says sport doesn’t imitate real life…Germans V Spaniards!!!!!.

1.By jove its starting…resource companies are finally working out that they need to reward shareholders…Oil now, maybe others later..WPL have set things in motion..expect to see the pressure increase across the board…Santos chief executive David Knox says its ability to reward shareholders will increase next year when a major liquefied natural gas project starts in Papua New Guinea. Mr Knox did not specify what kind of shareholder returns the company would distribute once its PNG project comes online in, but said the company recognised “yield is the theme” for investors at the moment

2.Atlas, Fortescue: An infrastructure deal is getting closer between Fortescue Metals Group and Atlas Iron, but it could hinge on WA Premier Colin Barnett letting go of his dreams of shared user export berths at Port Hedland.

3.Brambles shareholders and analysts are talking about the spin-off of $2 billion filing and storage business Recall as a fait accompli, and have turned their attention to where it should be listed. Recall is headquartered in the United States, makes more sales in the Americas than anywhere else and its closest listed peer, Iron Mountain Inc, trades on the New York Stock Exchange.

4.More reasons to buy TLS as Vodafone continues to struggle.. Vodafone’s Australian venture came close to breaching covenants on a $3 billion loan earlier this year, but was saved by its global parents in February who paid off $173 million to its international banking syndicate.

5.“The Fed has “enabled” Washington to do nothing, since the politicians expect the same “rabbit out of the hat” rescue that occurred in the darkest days of the financial crisis. This means no growth strategies (“the mix of policies has to be right”) will occur – until the Fed draws the line.” According to former Fed governor Kevin Warsh

6.In a three-year operation, hackers linked to China’s military infiltrated QinetiQ’s  computers (these guys are like Q from James Bond in the US) and compromised most if not all of the company’s research. At one point, they logged into the company’s network by taking advantage of a security flaw identified months earlier and never fixed.

7.PORSCHE REPORTS BEST SALES MONTH IN HISTORY; DELIVERIES UP 29%

8.With the eagerly anticipated global release of the latest Penfolds Grange looming, national liquor chain Dan Murphy’s has leapt out of the gates to offer a price of $669 per bottle, a 15 per cent discount to the recommended retail price for the iconic wine.

9.Find it a bit sad that Myers is going on about the new levy that will rob them of sales ..what about all the Disabled Australians and their carers who will be better off..isn’t that better than flogging a few extra bits of Manchester or dresses for race goers!!

10. Facebook Inc. (FB)’s first-quarter sales topped estimates, a sign that Chief Executive Officer Mark Zuckerberg is making headway in a drive to make more money from mobile ads.First-quarter sales rose 38 percent to $1.46 billion, Facebook said in a statement today. That compares with the average estimate of $1.44 billion.

And finally…………

Just read an article about a lady who makes ice cubes from left over wine.

I am so confused!

What the hell is left over wine?

Have a great day….

Clarence

XXX

 

Any financial product advice contained in this email is general financial product advice only and does not take into account any one person’s objectives, financial situation or needs. Therefore, before acting on any financial product advice in this email, you should consider, with or without the assistance of an independent adviser, the appropriateness of the advice, having regard to your objectives, financial situation and needs