Rate cuts and Star Gazing

Week Ending 5th July 2019

Welcome to my Friday dribble where I talk all things the market, sport and life.

2 rate cuts and now tax cuts.....WOW. what a month. If this doesn't make people go out and buy a new flat screen TV, then nothing will...!!! It's strongly apparent that the government wants you to go out and spend big. But it's also apparent that people are a bit worried about their own personal household debt, which has never been higher in this country.

Last week I put out the dribble at 10.03am. A tad early given I mentioned Tim Hart and RIC, because the company announced at 10.15am that Tim would be leaving the company and there was a slight adjustment to earnings as well.

Watching the share price movements in BGA and FNP suggest that its pretty tough out there in milk land. Northern Victoria is obviously struggling and milk collection is getting harder to come by and they may need to pay up to get supply..?? If they pay up then margins get squeezed and the processors profits fall a bit.

Great to see the spin still coming from the almost out of fizz drinks company CCL. This week they finalised the sale of the SPC tinned peaches and baked beans company. As they said back on the 4th June announcement they have sold the business for $40m, stating they will make a profit on the sale of $14m. However that doesn't take into the account the original purchase price and capex along the way which totals way more than $500m.....Truth be known this is a crap deal done by crap management and don't be surprised to see the baked beans relist some time in the future with a market cap well north of $100m. Outstanding work by the purchaser...!!!

The dribble is off next week with the school holidays. Alice and I are off star gazing at Siding Springs and Milroy observatories near Coonabarabran. Better take a warm coat..!!