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

Market: Europe. This is the start of act one of a multi act farce or pantomime. Greeks will be voting Feb 23 and gash knows what is going to happen between now and then. It’s a mess and not sure what people can do to solve it. Nov 23, the super committee is reporting on budget deficits and he is not very hopeful they will come to any resolve. Seeing hopeful signs: Better Q3 earnings and reasonable guidance going into Q4; Slightly better employment picture; Some indication that rental housing market is taking off and will eat in to oversupply of unsold homes. Bought something to day that was down on an earnings miss and was cheap in their eyes.

Bond markets. Canada is a net beneficiary from all the noise when looking at Cdn government bonds. Bond market has once again outperformed the stock market because of the flight to quality. However, it has put bond yields at levels that are less than exciting for the average investor.

Good corporate US bond? There are thousands of them so it is difficult to pick one. Would be very cautious of the financials. You might look towards a Walmart, Microsoft, etc. that are very strongly rated. You won't get much interest on them given where short-term rates are in the US. (See Top Picks.)

Outlook on bond funds and factors determining direction? Cdn bond markets have returned 7.4% year-to-date. If your fund has significantly lagged that you have to ask why. If you have a high MER on your funds that is something you have to be careful of. Would suggest you look at Universe Bond ETF (XBB-T).

Ontario provincial 4.4% bond maturing June 2/19. They're on track to reduce their deficit to get back to fiscal balance in the next 5 years.

How does an Exchange Traded Receipt differ from an ETF? Basically you have a piece of paper for the gold you have in the vault as opposed to having a piece of bullion held elsewhere or a futures contract.

Is it possible or advisable to write calls from options accounts that are covered by stocks in an RRSP account? It's a bad idea and it is not allowed anyway.

Could a person have a portfolio of nothing but ETF's? John has been doing this for 12 years. A highly desirable thing to do. Doing this, costs are very low. It is more tax efficient and you know what you are paying for.

Sell deep in the money Calls on blue-chip high dividend paying stocks. Good income strategy? Not a good strategy. He always writes options as close to the money as possible. It gives a lot more flexibility and potential gains.

Future for ETF's trading very few shares, sometimes none, on a daily basis? When looking at niche ETF's, it is a problem. You want to keep your portfolio size to a reasonable, understandable level. You don't need to get into the exotic, illiquid stuff.

Cdn Banks using covered calls if you own and naked puts if you don't? He uses covered calls on bank stocks and ETF's. Great way to generate very tax efficient income but your return will depend on the volatility of the equity. Wouldn't be too anxious to write calls right now.

If a stock is below BV, is this a good investment? In certain sectors, BV is very meaningful, but in others it is not. Would not buy a stock just because it is below Book. It is one of the ingredients but not the only one.

Markets. There are lots of opportunities. Was mostly selling in the 1st 6 months of the year and not doing much at all in the summer. Started to buy again in August. Doesn't know where the markets will go from here but there are lots of bargains out there.

Europe. Situation is untenable and is dealing with the financial stability of the world. A political situation trying to solve a financial situation, which is dangerous. Surprised that the markets are treating the situation so nonchalantly. Credit markets are always a good leading indicator. Generally speaking when you finish a crisis, there is some kind of a climax, usually on the upside..

Cash. To be invested in cash and have complete liquidity, you would not be invested in the stock market, which could be a good or bad decision. There is really no place to park your money in the short term and make anything on it.