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

Now is a good time to invest in Canadian Banks. You don’t have the risks of the US banks.

Gold is over $901 because (1) Financial crisis has abated. (2) Inflation has not been resurgent and it has been a weak seasonal period for gold. Ended a late January/Early February for gold. We are confirming we are in a new higher range for the resource cycle. Has contrairion view on Natural Gas. Futures prices are higher than spot price and producers are moving up. We are starting an economic recovery of some sort. An up-tick on cyclical demand. Green shoots to cyclical demand.

Bank stress test is just as much a public relations campaign as a real test. Following tests, there might be a run on the worst of them.

Canada’s decline in GDP is in line with the rest of the world. It’s going to take 3-4 years to take out the previous highs. Mediocre outlook for rest of this year. Concentrate on firms with good dividends and solid balance sheets. Financials and consumer discretionary stocks will lead us into the recovery.

Gold: Might consider adding to positions. Gold performance since Lehman collapse has been under whelming.

Lots of money on the sidelines. Lightened a little in the last week or so. Energy & Technology look good. US Financials will turn. There’s a lack of investment alternatives out there. People are going to put a little more risk in their portfolio.

Maybe the IMF is not that pessimistic. This recovery is stretching out into a longer process than anyone would have anticipated. The Boats are Sinking Slower and it’s a while until you see a bottom. Another wave of loan losses coming, especially with credit card debt. We are long-term investors. It’s an opportunity to upgrade portfolios. Would avoid forest products. Auto industry is speculative.

There will be more layoffs; more factories shutting down and so there won’t be a sharp rise in the stock market in the near future. Not sure we will test previous lows, but certainly go down into the 8000s. Expecting to see a lot more earnings disappointments that surprises.

There’s nothing surprising about any of the comments coming out of the IMF. We are a small cog in the wheel of the global economy. Everyone is getting a little ahead of themselves in the rally. There’s lots of negative scenarios – printing money, unclear earnings, all lagging indicators and the question is: what will it look like in 6 months. People are getting to a comfort level. Thinks we are at the stage where we see turnaround. It’s time to dollar cost average. Markets are picking up a bit.

Natural Gas: Seen a significant decline in Natural gas. At some point the price will increase. Would not play a leveraged product.

There are active and passive ETFs. You have to buy them for the strategy that they use. Feels active management does not add a lot to performance.

Inverse ETFs can be bought in registered accounts, but there are more sophisticated ways to do the same thing in a registered account.

High Quality Corporate Bonds: He is seeing spreads inching up over the last couple of weeks. Probably get 2-4% above government bonds. Your still early in this game

Value-Based Equity: Value stocks are beaten down more than the growth stocks. Growth area has higher valuations.

Preferred Shares: You have widening of spreads. They are trading well below their par values. Yields to maturity are quite attractive. Tax-efficient income.