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

Government of Canada 5.75% bonds due June 1/33. Likes long bonds in Canada because he thinks we are in a deflationary and the yield curve is too steep. Looking for tepid economic growth and yields should come down. Risk/reward is very good.

Economy. We are in a deflationary period as opposed to an inflationary period in the shorter term. Capital utilization is still very low globally. There is no job growth. Now would be the time to invest in bonds.

Gold. Has run up a lot but could potentially go to $1500, but if that happens it will happen very quickly. If you think that is going to happen, the less risky way to play it is GoldCorp (G-T) or Agnico-Eagle (AEM-T). They may not go up as much but won't fall if gold collapses. Small caps will participate more. Alternatively you can own and ETF.

Crude oil. This will trade between $65 and $70. Seems to be a pretty strong barrier at $70.

Interest rates. Australians raised interest rates but doesn't think Canada will do so for at least 2 years.

Greater Toronto Airport Authority bonds. Fantastic business because they charge fees on every airplane that goes out. Highly rated bond but the problem he had was the higher risk for the amount of compensation.

Government of Canada 5.75% bonds maturing 2033. Real opportunity in the bond market is the long end of the yield curve. Curve is going to flatten, which means the long end rallies more than the short end. Real rates are too high in Canada with the Cdn$ going higher and the massive overcapacity globally and this will create deflation.

Nat-Gas : Unless we are heading into the coldest winter on record, the good news is in for a while. Take profits and look for something else

A Lot of people were looking for a pullback, but there is a lot of money on the sidelines. It is a liquidity-driven market. Let’s see how the third quarter earnings come in. Not a fan of the financial services sector. They have lightened up. There is not that much more up-side in Canada right now. Likes the liquidity flows in the US, but it’s a little bit stretched. The economy is recovering. He is not playing the market toward a correction, but he is upgrading his portfolio to reduce risk. The Nat-Gas rally has run its course.

Gold: Bullish. The breakdown in the US$ is significant for commodities. We are early in this move in Gold.

Gold: Bullish. The breakdown in the US$ is significant for commodities. We are early in this move in Gold.

Rebalancing portfolio mix. There has been a big run-up in the equity market and people have benefited from it. You should be looking at your portfolio and the asset mix to make sure it is in line.

Dividend biased equities. Dividends are an important part of any equity exposure. Equities have come very far and there is some downside risk. You want to focus on good companies that have a consistency of paying good dividends, have good cash flow and growing dividends.

Hard asset commodities. Consider currency risk of the US$ and inflation. Look at the diversification in your portfolio such as gold, silver and hard asset commodities. They can add a lot of value to your portfolio.

Market outlook. Expecting a pullback in the market. Pick the stocks that you like and a price you would like and wait for the pullback before buying. Caution is the order of the day.