David Fuller's view Sean Egan provides a clear, analytical and unemotional summary of a rapidly deteriorating situation for European banks and I commend this video to all investors.

This crisis certainly looks as if it will get worse before it gets better, not least because European governments currently seem to lack the collective vision or will to cope with it. I assume that there will be further contagion although that is unquantifiable because it involves panicky reactions.

Assets closest to the crisis epicentre have the greatest risk - sovereign bonds which have yet to fully discount the denouement mentioned by Sean Egan above, European banks and any other likely holders of these bonds, such as insurance companies.

Contagion can easily spread more widely, as that is in the nature of investment herds. This will create buying opportunities in assets which have very little to do with the European debt crisis. If I ask myself: What impact will the European debt crisis have on Fullermoney investment themes over the medium to longer term, my answer is very little. In fact, it may enhance their appeal.

(See also Eoin's comments below.)