A Comment -- General Comments From an Expert (A Commentary)

Markets. It is all about the fiscal cliff. Usually after the election you get a celebration, but a little pop into the end of the year and he thinks that is coming but markets are having to digest what is happening with the fiscal cliff and taxes. They are going to kick the can down the road. Thinks they will hammer out a compromise.

Education Segment. Fiscal Cliff. Base line scenario is US will have a $612 billion deficit and there will be deficits through 2022. Alternate forecast - if they do nothing it will be $1 Trillion Deficit next year. Debt will get downgraded. 2013 does not look good, not globally either. There will have to be a deal. If they raise the dividend tax, that could hurt the stock market, but he thinks instead they will increase the tax on the rich. See http://www.cbo.gov/

Markets. He is not focused on the fiscal cliff. They are politicians and will straighten it out. It’s just continuing to kick the can down the road. With Europe it is structural, though. The solution or part of it is more monetary easing. They are continuing to press the print button. He would go back to the BRIC nations. China is also going to do some monetary pumping or priming.

Markets. Environment for oil and gas stocks is very challenging. Europe, fiscal cliff. Many things to be nervous about. Statement today claimed US will be energy independent by 2018. Some names have been sold off for reasons of fund for reasons that are fund flow driven rather. For well over two years mutual funds have been redemption mode. People have been holding on to their money. That factor has been driving the overall market. Investors want yield and many oil and gas companies don’t provide a yield. US and European investors are not investing in Canada. There have been consistent headwinds. He thinks there has to be a catalyst to change that. We need a macro economic change – evidence that China is not slowing down any more. People need to be more confident that the world is not ending.

Markets. Investors have shown they are quite fearful. Obama sincerely looks like he is ready to compromise on the fiscal cliff for once. Recently he has had a little bit more cash than normal.

Markets. You can toss a coin as far as where the markets are going. The markets are not telling him a lot. The US election is out of the way after 3 years of leading up to it. There will constantly be negative news but nothing out there that will shock the markets. He has started to troll this week. We are moving into tax loss season and that is his time to buy.

Markets. European central bank sees no growth next year. He focuses on two sectors – precious metals, gold and natural gas. Feels the latter two will do well with negative or no growth. Nat gas is detached from global demand. US election was one little pin point that is no over with. The next thing is the fiscal cliff by year end and they are not cooperating on many fronts. Europe is voicing concern about 2013. Market is looking for concrete steps.

Markets. News is not affecting his investing strategy. Markets have not been kind following the election. Markets are worrying about how we get through the fiscal cliff. He will believe that the sides work together when he sees it.

Mutual funds. He has found through history that actively managed funds lag the benchmark. Asset allocation and other passively managed funds are different. He does not have a problem with them.

Can ETFs be overbought or oversold? No. ETFs replicate the underlying securities. It cannot be overbought or oversold more than the underlying securities. He thinks they are misnomers and that there is no such thing as overbought or oversold.

RESP: Can you contribute more, earlier? Yes, but you don’t get more than the max grant. The money grows tax-deferred.

Transfer stocks into TFSA? Yes, you can do that. But when you contribute the security, you still get hit with the capital gain.

CFA: is a great designation and pretty hard to get but it is for people that are dedicated to security analysis. He believes markets are highly efficient and so not a lot of time should be spend worrying about a penny or two of additional inherent value. CFP deals with a bigger picture.

Principle Protected Notes (PPNs): They are a structured product. Hard to sell until they mature. They would have been great in 2006 but in 2008 it was like closing the barn door after the horse has gone. If they are the only way to get you into the equity market then they make sense.

Low Volatility ETFs: Several companies have come out with them. This is one way for people who can’t stomach volatility to enter the equity markets.