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

Silver: Thinks it is overvalued. There is a huge production in the world. But people think there should be a ratio between gold and silver. Thinks it is ripe for a pullback.

A little weary of where we are. Globally we are at our near term highs. Except in Canada where gold might go a little higher. You need to pare back those ears of the portfolio that have grown out of proportion. The economy really needs support in the US. He has been taking some profits.

Silver. Probably tied to gold, which has gone up too fast in too short a time. One thing silver has that gold doesn't is that it is consumed because of industrial purposes. Believes in its strength because of the industrial component. Look for companies that have not followed the commodity.

Canadian Natural Rsrcs (CNQ-T) or Suncor (SU-T)? Likes and owns them both but probably prefers CNQ a little more at these levels. Has more diversification in its operations.

NAV Canada Bonds. Basically an infrastructure play. Very good structure. Fairly low yield but very dependable and a good bond. AA

5- Year Quebec Hydro strip bond. Hasn't benefited from the real interest rate move that has happened in the 30-year or 10-year. Over time, it should do fine.

Real Return Bonds. Real yields are in a bubble so these are not attractive right now. There are better assets for an inflation-adjusted return.

30-Year Canada bond yielding 5%. Because of its duration, it will have a lot of exposure to interest rate moves i.e., a lot of risk. Expects interest rates have put in a bottom and inflation expectations picking up in the short-term.

Today’s Market Call was pre-empted for live coverage of Federal Finance Minister Jim Flaherty’s Fall Economic Update.

He is looking for a very short term set back after the recent rally. He is optimistic going into the end of the year. The major impetus for growth will come from developing nations. Thinks the fed will do more quantitative easing, but he questions how much good it will do. Stocks will go higher after the US election on Nov 2.

We had been in a fairly wide trading range since fall of last year and now have broken out of it. He favours energy because price of oil has moved up quite nicely and is sustainable. He can see oil hitting $90 and maybe even $100 by end of 2011. Calgary and Alberta-based companies are quite exposed to Nat Gas. A lot of their valuation models have an expectation of higher gas prices. It could get to $3 or less.

Natural gas prices. Shale revolution and horizontal drilling has made the question of price recovery open-ended. There are massive shale reserves in North America. Might be some shorter-term spikes but the supply is there to meet them. Expect we are in the range of $3-$7 longer-term.

What a big turnaround in the markets since the spring. The double dip is a memory. You can’t loose for commodities. It’s rare to see all asset classes going up together. In the long run something has to give and he believes that over time bonds and gold will trend down. Gold and bond prices have gotten ahead of themselves. There were no earnings warnings heading into the third quarter. Profits are going to remain strong. If we have a 5-10% pull back in stocks, bond holders should move into stocks.

Gold: Can’t believe it’s got this high. Prefers to own the big producers. Maybe it will in deed hit $1500.

Canadian Bank Tier 1 Bonds and the call feature? Bonds can be called on a change in regulatory or tax regime. With the coming change in taxes, there is a risk these could be called early at par.