In case any reader hasn’t worked this out already, 2016 is going to be a tough year.

Normally March is a buoyant month because investors are looking forward to nice dividend payouts from the leading stocks. After the dividends the market usually retreats a bit, hence the old advice “sell in May and go away”.

This year the market stayed stubbornly down despite the dividend season (which included a pretty poor one from dual-listed mining behemoth BHP Billiton) and now we are contemplating May with some dread.

May is also known as confession season because that’s the month when companies which are having a bleak year come out with their profit downgrades.

Royal commission a stunt

Worse, Bill Shorten and a few National Party MPs are calling for a royal commission into reported misbehaviour by banks. This can be dismissed as a stunt because the politicians should be well aware that regulators such as the Australian Securities and Investments Commission and APRA have all the necessary powers to punish banks for any misdeeds without spending millions on a royal commission. Nevertheless, the twin threats have been enough to deter punters from averaging down their bank holdings.

BHP and arch rival Rio Tinto are marking time until commodity prices improve. Shares of supermarket chain Woolworths have been sliding since September 2014, those of telecoms giant Telstra have been sliding for nine months and Wesfarmers, the owner of supermarket group Coles, has been going sideways since 2013. So the leaders have been leading us nowhere.

In this difficult environment, it seemed worth listening to the views of Geoff Wilson, one of Australia’s better long-serving fund managers, who was doing a roadshow around the capitals last week for his funds.

Wilson is nervous about the market, holding 37 per cent cash in his senior fund and not many shares in the leaders. “We’re not so much in the top 100 as the 100-to-200,” he said.

What makes Wilson nervous is that Australia’s record low interest rates have failed to stimulate the economy.

“We had a 30-year super debt bubble and got high growth, but maybe we are now going back to 1900-1960 – a low growth, low inflation environment,” he said. “Maybe this is as good as it gets.”

Being Wilson, though, he still has a couple of tips for the punters. He likes consumer products company Pacific Brands because management has cleaned up the company and it is now down to eight brands, including Sheridan and Bonds.

Move towards retail

Pacific has also moved from wholesale into retail. Becoming a retailer obviously required more capital because they had to have their own stores, but margins are better so to date the move has been working for them.

Sales have improved. Bonds and Sheridan, the top brands, are selling well and the group has returned to profit, although the higher Australian dollar is hurting the UK business.

Wilson also likes Southern Cross Media, because radio doesn’t have the same structural problems as TV. When the cross-media laws change in July, Wilson thinks we will see the same contraction as occurred in the banking industry in the 1970s and 1980s, when seven trading banks shrank into four.

One possible move would be for Nine, which already holds 10 per cent of Southern Cross, to take it over. The earnings would boost Nine and its advertising base would be spread wider.

Anyhow, Wilson reckons there should be further upside in both stocks.

Incidentally, the Wilson funds’ first presentation in Sydney drew a crowd of 500. Previously they’d never had more than 300.

Presumably that’s because more investors are seeking good advice – but Wilson thought it might be because they were giving away free sandwiches.