=====================
-Avoiding a Greek "Horror Story"
=====================

Following the comments of the Bank of France Governor and ECB member Christian Noyer it should be clear to Europe that a restructuring of Greek debt, considered a form of default, will have catastrophic consequences not just for the Greek Economy and its banks but for Europe and the Euro. It is therefore essential that Europe comes together to agree a sustainable plan to assist peripherals economies in a way that, while implementing austerity measure, it doesn't suffocate their growth.

-European Banks Stress Tests
The European Banking Authority will be releasing the stress test results next month. With a new, stricter definition of capital there could be some unpleasant surprises. Even if some banks already raised 122 Billion since last year there could be some unpleasant surprises. So I still maintain that there are selective opportunities in the European banking landscape I favor well capitalized smaller - regional banks with good liquidity. Even in Switzerland some smaller banks with conservative business models are trading at very interesting valuations close to their book value.

-Commodities: Is the correction over ?
According to Goldman Sachs the healthy correction present a good buying opportunity. I agree that the pricing now is more interesting in several commodities. Gold is benefit from stronger fundamentals and from several factors including the announcement that the Shanghai Exchange is planning to launch Gold ETFs to meet the increasing demand.
In my opinion, while more corrections in the commodity market can be expected, investors should maintain an allocation to a diversified basket of commodities (10-20). This because the fundamentals in this market are still positive and growth will further increase demand while supply is fairly limited in several commodities.
Gold is an exception as it will raise regardless of growth - so I will be very surprised to see gold under 1600$ by year end.

European Opportunities
The market turmoils and uncertainties present some pocket of value. I like European brands with a long history and no replacement with strong presence in growing emerging markets - this include consumer products.
As an example luxury automobiles like Porsche and BMW will experience a 20% growth in China alone this year and are aggressively establishing new dealerships. I like European brands that has been around for at least a century and will be around in the next century. Any uncertainty in the broad European markets represent a good buying opportunity in this sector.

In short
Strategy: Greek solution to surface, opportunities in European multinationals
==============================================================================

- A Greek default or restructuring can have serious destructive effects to the broad European markets and the Euro.
Europe should enact a quick plan to address the situation in a sustainable way that will not suffocate growth.

- Cautious on European banks, with rare exceptions, before more clarity is established with the publication of new EBA stress test.

- Opportunities in Global European companies, particularly these with exposure to emerging markets.

- Commodities: while volatility might stay the long term fundamentals are largely intact. Particularly positive on physical Gold. I Recommend a broad allocation through a commodity index.