THE DISTILLERY: Hungry bears

GFC Redux, a Lehman Brothers moment, anyone for a bear picnic? What about a good old fashioned dose of gloom and doom? Beats Rate Rise Looms. Not so much red ink overnight compared to the night before, but markets are still nervy, with the Americans desperately searching for good news, despite more signs of stalling. In Australia, investors large and small and many commentators seem to believe we are in desperate straits.

The Herald Sun's report was typical this morning: "The Australian share market is teetering on the brink of a correction after a vicious sell-off wiped nearly 10 per cent off the value of local stocks in the past two months. A massive $28 billion was ripped out of the Australian share market yesterday, as a fresh wave of fear about the global economic recovery washed through the international trading community. The flight to safety leaves the ASX 200 index of Australia's biggest listed companies within a whisker of a correction – technically defined as a 10 per cent pull-back from peak levels – having tumbled 9.9 per cent from its 2011 high, in April."

Adele Ferguson wrote on smh.com.au: "Renewed fears of a debt default in Greece coupled with the release of some disappointing economic figures out of the US and Australia is behind the latest bout of investor jitters as sharemarkets around the world post falls. The fear factor was embraced by Australian investors, who dumped stocks this morning, and who have demonstrated over the past few months that it doesn't take much to prick their fragile confidence. Investors get spooked when they see headlines, photos and footage of tens of thousands of protestors standing up to the painful austerity measures that have been imposed on Greece as a precondition to a bailout." This morning Ferguson was on the same theme: "With the drumbeat of doom and gloom banging loudly over the global economy, it is little surprise that investors are bailing out of equities and currency markets. Global markets around the world took a battering in the past 24 hours as the Greek government spiralled out of control, tens of thousands of citizens protested in the streets, and investors punted that any future bailout package was all but dashed, leaving Greece to default on its debt obligations – all of which would trigger a deeper financial crisis."

The Australian's John Durie wrote this morning: "The Australian stockmarket has long lost international support and is now in danger of losing domestic institutional support, with the index down 10 per cent since April, the first official correction since last year. Retail investors have long ago lost interest and are tending to put more money into cash or pay down debt. This same caution is of course hitting retailers hard, particularly at the discretionary end of the market."

The Australian reports: "Australians may have to give bank bashing a rest – an annual RBA survey shows bank fees in 2010 did not rise for the first time in 13 years. Australians paid $11.1 billion in bank fees last year, but businesses are paying more to cover the banks' decision to cut householders' fees. The result was attributed to the major banks ordering widespread fee cuts in 2009 to win customers."

The Australian Financial Review reported: "Research by the Reserve Bank of Australia appears to confirm that the intense political pressure for banks to lower fees on households has led to an explosion in banking charges for businesses." And, the paper's Chanticleer columnist says: "The latest bank fees report from the Reserve Bank of Australia could easily mislead investors in bank stocks." And the paper also reported this morning that: "There's been a steady flow of deals in the mid-tier mining sector already this year, but some are tipping it to intensify if equity markets remain suppressed."

The Australian's David Uren says: "The mining boom is creating a sharp division between the economy's winners and losers with professionals and clerical workers gaining jobs while sales staff, labourers and skilled tradespeople are facing poorer job prospects."

Fairfax's Elizabeth Knight wrote: "The chief executive of Telstra, David Thodey, called the media together yesterday as the company was on the cusp of signing a deal and providing details of an historic agreement to cede its wholesale business to the government-built national broadband network. But he opened with media conference by saying he was unwilling to talk about it under any circumstances. The hot topic became the elephant in the room as Thodey proceeded to outline Telstra's plans to beef up investment in its cloud computing business. Thus yesterday's announcement took on the feeling of a sideshow - while the frustrated media recognised that they would have to wait until early next week to get the detail of the broadband network deal."

The Australian's Nabila Ahmed says: "For the first time since the index's inception in March 2000, Aristocrat is set to be punted from the S&P/ASX 100 after the close of trading today. It's another blow to a company struggling to gain traction with new products at a time when the soaring Australian dollar continues to eat into its earnings. Aristocrat loses $1m in profit for every 1 cent rise in the dollar against the greenback, so its guidance for profit of $60m to $65m for the year to December 2011, calculated on the basis of the two currencies being on a par, is under threat."

North to Alaska? The Australian's Tim Boreham wonders about Linc Energy's North American trek: "Sarah Palin may not be everyone's ideal tea party guest, but don't expect snide remarks about her from Linc. Linc has bought a controlling interest in a field in Alaska's National Petroleum Reserve for about $US50 million ($A47.5m). The conventional field is expected to peak at 50,000 barrels of oil a day (bopd). Earlier this month, Linc bought 14 oilfields in Texas for $US236m. It's all part of its target of being a 100,000 bopd producer "over the coming years"."

The Australian's Matthew Stevens wonders about the end of the affair at Fortescue Metals: "Yesterday's confirmation that US vulture fund Leucadia National is no longer a substantial shareholder in Fortescue Metals Group after trimming its position to just under the threshold, suggests the joy has gone out of the wonderfully profitable five-year relationship between iron ore's new force and its erstwhile cornerstone investor." Can the roses and chocolates.

The Australian's Bryan Frith wonders about the fate of iSoft and its possible acquisition, which would save it from an unfortunate fate: "Healthcare systems provider iSoft hopes shareholders of the debt-laden group won't let the supposed "benefits" that one shareholder, private equity group Oceania Capital Partners (OCP), will receive cloud their vision when they vote on a proposed takeover by US IT giant Computer Sciences."

And finally, AAP reported yesterday: "The country's biggest lender Commonwealth Bank of Australia has quashed media speculation that it was ever interested in buying Insurance Australia Group Ltd. "Commonwealth Bank of Australia wishes to clarify that, contrary to the implications contained in today's media reports, it has no current interest, nor has it ever had any interest, in acquiring Insurance Australia Group," the lender said in a one-line statement on Thursday. Fairfax reported on Thursday that CBA chief executive Ralph Norris "ran the ruler" over IAG last year, with a view to a possible $7 billion-plus takeover." So how did the story emerge in the first place? A beat up from one source?