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

China: Official numbers for unemployment are probably 65 to 70 million people and is a result of laying people off from farming as they industrialize and try to boost yields. CIA number is probably 160 million. Also 25% food inflation in the last year. To prevent civil unrest, government will probably try to re-stimulate and try to keep economy going for the next year and a half. Post the Olympics there will be hyperinflationary growth. Banking crisis probably follows in 2012.

Euro: Believes the US will want to devalue their currency by another 20% to 30%. Market forces might do it for them. If this happens, the Euro will have risen so much that you’ll have some of the weaker nations wanting to bail out of the European Union. Feels the Euro will cease to exist by 2010.

Tonight's show was on wine, not stocks,so I have nothing to report. Bill

Oil Services: Outlook is probably as good as it has been in a number of years. You could look at some of the main players Schlumberger (SLB-N) or Precision Drilling (PD.UN-T).

Gold: Likes gold, particularly in these times. It has behaved very much like a commodity in the last couple of years, but in times of desperation gold becomes a currency. He is looking for gold to go much higher over the next year or two because currencies are being debased. Gold could go to $1500.

Gold: When US$ was falling, gold was rising. As inflation starts to come to the surface, there will be a major shift and gold will be more focused on inflation.

People are finding the markets rather tough. If you are prepared, you don’t mind. The bottom is not close. It’s been almost a year. The world is de-leveraging right now and it’s going to take time. Many institutions want to sell assets. There’s always something happening somewhere in the market. Is happy to short in this market.

Gold: Q: Royal Bank of Scotland (RBS-N) is calling for a market crash within 3 months. What happens to gold? A: If this happen, which she doubts, gold would probably go up.

Turkish Economy: Strong emerging market in 2008 and for years to come. Stocks trade at about 8X forward earnings with very handsome dividend yields of about 4% and 5%.

Canadian Banks: As of now they are dead money. If you go for yield, you are going to get slaughtered. Canadian Banks currently are the most expensive banks in the world.

Stagflation: When there is persistent inflation, say 4%, and at the same time the economy isn't growing. A period when it is hard to make money. If this happens, you might want to own “real return bonds”, bonds that are issued by governments and are reset according to inflation. Also regulated utilities that are allowed to raise rates according to information.

Natural Gas: Potential for natural gas in the future is very, very good. Based on where oil is trading, they should be $20 MCF rather than its 12. Undervalued. The potential probably won't show up until we are into the winter heating season.

Agriculture: Food inflation is going to continue to accelerate. With the price of oil going up, shipping costs have to be passed on to consumers. The input costs of growing food products has all gone up as well.

Would like to see the government have a strategy similar to what was done in the last oil crisis where they created Petro Canada. It did very well for the country by spewing a lot of money into government coffers and, when it was sold, was a big windfall for the government. Time has come to create a national alternative energy company at the government level. They should invest $50 to $75 billion and combine geothermal, solar and wind. Would like to see a point where we are completely self-sufficient on the electrical power grid through renewables. Currently about 13% of our electrical power comes from Hydrocarbon consumption, 16% from coal and 14% from nuclear. Surplus power could be sold to the US. 10 years from now oil is going to be astronomically high.

Market Call Tonight was a special on Stock Scams with the OSC representative. No stocks were talked about, so there is nothing to report.Have a good weekend. Bill