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

Market. Feels we are in a bottoming process here and in the economy so it may take a little time but there are some opportunities out there.

Gold. Feels that gold will still remain relatively strong, above $1500-$1600. He is biased that the gold stocks (versus bullion) will start to rise.

Oil. This is probably in some kind of a range. Not sure it has bottomed yet or not. Might retest its lows in the next couple of months. Europe has some issues to work out as does the US. Economically sensitive commodities, such as oil, could just continue to grind away.

A good time to invest in a NASDAQ ETF or mutual fund for 12-18 months? 12-18 months is really speculating, not investing.

Tax implications on US holdings in a TFSA? It doesn't really matter, as you do not pay interest going in or coming out.

Short-term bond funds for cash positions? There are 2 he would recommend. A 5 year laddered from Claymore (1-5 yr Government Bond ETF) (CLF-T) is basically 20% in 5 years and 20% in 4, 20% in 3, etc. There is also the DEX Short Term Bond (XSB-T).

Ratio of small caps, medium caps and large caps in a portfolio? He would encourage people to tilts more to small and mid rather than to large. Large caps usually have lower returns.

Bond ETF's. Does the low average volume represent a higher level of risk or cause greater volatility, particularly on the downside? He used to be concerned about this, but the more he looks, the more he realizes it is not an issue.

Market: Concerned about markets. Buffeting we have taken is giving us cause for concern. Psychology turns on a dime and it is only evident after the fact. Pessimistic about the US economy but not expecting a recession. Corporate world is doing quite well and will hit record levels in a month or two.

Market: He is somewhat bearish on the economy, on the economic outlook. Stock market had risen so high that it was discounting anything that was particularly good that could happen. You had to have an awful lot of economic good news. Ben is almost at a loss for words. QE2 had not produced the results he had hoped for. There is a lot of dissent in congress and in the fed. The only way QE3 could get underway is if the stock market takes another tumble. The problem is that the US has an insolvent balance sheet and need to clean it up. Dow transport had been leading the market all the way up. It reached a valuation level it had not seen in 40 years. It has given him a bear market signal. Thinks it is one of the leading indicators of where the markets are going to go. He put is clients in 30-35% cash. Lots of income stocks.

Economy. Seeing a rapid deterioration in high-frequency data. Market seems to have been quite resilient to these data points and is not betting on QE3.

(A Pairs trade. - Long Sea Dragon (SDX-X) and Short Bankers Petroleum (BNK-T) Dec 21/10. Down 33.44%.)

China: Great to diversify by geography as well as industry. China’s market has been hard to ignore because of the pace of growth. You don’t have visibility into corporate governance and so on. You want exposure to China by investing in companies that do business there. Prefers SGS to get exposure to China.

Market: Frustrating market for investors. Corporate fundamentals look very, very good. Balance sheets have lots of cash on them that is not getting put to work. Equity markets don’t reflect this. Fears over the US and European economy and US sovereign debt standpoint. Investors don’t need to be completely afraid of it. We haven’t priced in the worst expectations. But it is a bullish signal when bad news is taken as a good thing as it was today. This was a holiday month and was thin participants-wise. Employment numbers at the end of the week will be the big data point. June and July he went to 10-12% cash and is mostly there. During August he brought any clients down to that point if they were above.

Small Cap Market. Volatile market will continue and investors are very jittery. There is a lot of good value in a small cap market. A lot of them are still reporting very good earnings. Very much a bottom-up scenario rather than a top down. Looks for companies that are trading at lower PE’s with good visibility. Likes those that grow their earnings at 20%+ and trade at 10-12 times earnings.