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

Floating Rate Bond ETF such as HFR-T or XFR-T in anticipation of rising interest rates? Not a good place to put your money. Also it does not appear as though short term interest rates will be rising anytime soon.

Italian 10 year bonds? He has a very good outlook on Italy because he doesn't buy a lot of the criticism that they are coming under. 7th largest economy globally. 4th largest gold reserves globally. It runs a primary surplus. High risk transaction because you have the value of the bond plus the value of the euro versus the Cdn $. If you have a speculative inclination, this is a good value.

$20,000 bond coming due on an 8-year ladder. Should he renew at 4% or go shorter? He thinks you should keep the ladder intact. 4% is a reasonable rate in 82% inflation world.

Markets. Has become marginally more positive on risk assets over the last couple of months. European sovereign debt spreads have come in a lot, which is a positive change underlying the markets. There is now more noise out of the US Fed about low interest rates continuing for 2 1/2 more years.

Markets. Believes we are in a bull market. NYSE advance/decline line has broken out. Dow is now at its old peak of 2011. Chart shows a pivot point occurring at the end of October. Ance we clear the pivot point, it is an indication that the bull is assured. Expects there will be a little bit of selling but it should not be very aggressive. It could meander sideways for a couple of weeks.

Semiconductor industry. Rose about its pivot point this week. It will probably sell down a bit for a few weeks and then start moving again. After that, the upward trend should start again.

Markets: Looks more on the short term to see a direction. Primarily on the down days there is recovery and then follow-on. It looks like we are in a bull market. Getting close to 200 day moving average on S&P. That will give another group of people the interest to buy some more. He is getting rid of stocks that don’t do well when there are inflation worries. You are seeing negative returns for bonds this month. Reducing income oriented investments and getting more into momentum investments.

Silver: Some correlation between this and gold. It is in a downward trend in a trough. Don’t expect too much out of it and expect it to consolidate about the $30 level.

Options: are tricky because you can loose 50% and still be ok. If you are long, probably 50% stop and an expectation of a double. Manage the risk very, very carefully. Stocks: 5% stop lose or if it is volatile, you may have to go more.

Markets. Feels that stocks and indices are overbought right now. We’ve had a 5 week advance and RSI’s are getting close to 70, if not above so is expecting a pause or consolidation but nothing to worry about at this point but over the course of the year, is pretty optimistic and constructive. Dow Jones is near a May 2008 high and NASDAQ 100 is near a 2001 high. US stocks have outperformed Canadian stocks this last year by quite a big degree and this could continue for some time. It also tells him that the US economy is muddling along, not too strong, but still moving forward.

Healthcare? A more defensive space so from a relative performance, it may not be the best place to be this coming 12 months. Names that he continues to like are Pfizer (PFE-N), Bristol Myers (BMY-N), Glaxosmithkline (GSK-N), Merck (MRK-N) and Abbott Labs (ABT-N).

Economy. The economic data in the US, Europe and Asia is not bad. Particularly in the US where it has been quite strong with a lot of signs of firming. Job numbers are getting better and housing seems to be bottoming. There are a number of tail risks in the form of the European debt crisis that have to be resolved and moved forward.

Markets: Fed going to keep rates exceptionally low through 2014. Lots of reaction in markets including gold shooting higher. You can borrow cheaply and buy gold. There is fear about how far the US recovery can go and can it tip over. They are keeping rates low to keep money in Europe. All in all it is probably a good move. US may be printing more money and that is good for gold. Keep in mind we are in a negative interest rate environment. You are not really getting any return on your bonds. The yield players are still a good place to be, even though they are fully priced.

Markets: Chesapeak production cut: They are sending out a message that after they meet their minimum commitments, they aren’t making money, so are cutting back production. A 1.5% cut in US gas production. Others have cut back also. We are slowly starting to see this message.