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

Market. Even if the US comes to an agreement on the debt ceiling, it is still going to be a mess for a while. It won't be like they have solved all of their problems. Difficult global environment. Has been as high as 25% in cash as of May but is currently whittling this down.

Problems in Europe are ultimately worse than the problems in the US. The US has an artificial crisis created by politicians trying to get reelected. US deserves to have its credit rating downgraded from AAA. He would view any major sell off as an opportunity to buy more stocks. He prefers multinational growth stocks with a dividend.

Natural gas. Warming up to this commodity. Looking at the major energy companies, they are buying natural gas properties. Their timeframe is 10-20 years so he feels they are seeing something that the market isn't. As a long-term investor, he feels maybe he should be looking at it too.

Safe havens. One of the best areas for safe havens is dividend paying stocks. They provide you with some downside protection in the event the markets go down.

Market: There has been a lot of noise in the market. But there are real concerns if the US does not come to some agreement on the debt. The longer-term impact – they have to come to terms with the debt at some point. Europe is a very real concern in the markets today. If there is some kind of a sell off he would be looking at all kinds of things. He has been adding a bit to some of his positions. Generally the quality of earnings has not been too bad.

Markets. On the broader risk asset classes, he expects we are heading into a tough period. Big rallies since March 09 lows have been liquidity driven largely by monetary and fiscal stimulus. Seeing signs of a slowdown in China. Impetus for further monetary stimulus is not really there at this time.

Economy. Once we turned the corner from the 2008 downturn, we've been picking up speed. The emerging economies are continuing to grow. The low interest rate environment will continue to stimulate growth. People are skeptical of the market and are under invested. With all of this, it's a positive environment.

Market: They are value investors. Commodity markets are signaling there is a strong economic recovery but stock markets are showing a stumbling economy. If the commodities are correct, then the stocks will follow. If the stock markets are correct then commodity prices could have significant weakness.

Markets have been undergoing a correction since mid-January. There are a lot of events and bad news that is built into the market. Basically, there is a nice bottom forming and we should be going up from here.

Oil. Global oil demand is at an all-time high and there are no significant sources of supply. There will be short-term back-and-forth movements and the bias has to be upwards.

Gold. In the last couple of months, he has been buying gold stocks. They've all had a good move so hasn't been buying in the last week or so but feels they are going to be a leadership group. Typically gold stocks perform pretty well in the 2nd half of the year. Gold tends to track global liquidity and money supply has been ramping up, especially in the US.

Ring of Fire in northern Ontario has a number of smaller companies that have been taken out. There will be infrastructure going in, which will make a lot of the smaller companies economic. You might like to own a basket of these companies.

Market: Deal brokered with Greece is a start. France and Germany are on side, so that is a good thing. US debt ceiling does not affect his investing style much. He is positive that US will do something about their debt. Company earnings are better than he expected. A lot is foreign demand and is also good balance sheets. He is 14’th largest shareholder in TMX group. His concern over time is: are they going to make the firm profitable? The banks and the shareholders want to make it cheaper.

Percent Dividend Payout: It is a percentage of cash flow. It’s a good indicator. Shouldn’t be above 60- or 70% because of lack of potential to raise it.

US finances. It is inconceivable that there will not be a settlement of the debt-ceiling crisis. Keep in mind it is only a Band-Aid that is required. Far greater issue is fixing deficits and the rate at which they issue debt to cover it.