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

Oil: Physical demand now is about 86 million barrels, which is about what is in storage. Summer driving season will pick up another half million barrels. Going into the winter demand could be 88 to 89 million. With 86 million in storage inventory is very tight. Oil prices will be considerably higher. Could back off another $10 in the next month and that's when you should be looking to buy. High impact exploration companies can be taken on now. (See his 3 top picks.)

Oil: Guru George Soros is calling for a correction, so he would be a little nervous short-term. Not reducing his weighting in energy related stocks. Looking out in 3 years, their will be great domestic growth in China, India and other emerging markets, which will offset any decline in world trade.

Likes agriculture, precious metals and infrastructure groups both short and long-term.

Gold: To date it has traded on US$ weakness but thinks this weakness is now over. Major force driving gold from here will be inflation, accumulation by central banks and sovereign wealth funds as well as the general demand for gold. Sees gold at $1250-$1500 over the next 12 months.

Gold: Tough to forecast. Not something you can model a supply/demand on. Very much driven by sentiment and technicals. Inflation is a little bit of a concern and gold has always been viewed as a safe haven from inflation. Think it will trade anywhere between $825 and $1000. He buys at the low end and sells at the high end.

Canadian Bonds: Not enamoured with provincial bonds. With higher inflation and a 5% yield, inflation is going to chew into this. Not looking for interest rates to come down. He does like corporate bonds where spreads have blown out dramatically.

Canadian Banks: These are well run banks. If you have a diversified portfolio and are comfortable waiting, these companies will start growing.

REIT Market: Is now the time to Buy? A: Pick your spots and don’t buy everything. Have been through one of the major breaks in the system and one can never know. His feeling is that we are very much at the high end of the quality range and you should be OK with the better names.

What happened to this “Sell in May/Go away” idea? Probably a continued rally for a little while anyway. It’s a stock picker’s market – one has to be careful about stock selection. Don’t choose just a sector.

Solar Industry – 10-20% upside on a lot of the securities, but one has to be careful buying into it. Would be better to go into a conglomerate that has solar and perhaps wind power.

Gold may well have seen it’s peak in the near term, but as a hedge, a little gold makes some sense. He doesn’t like gold stocks and finds them outrageously overvalued, so use gold futures or something of that nature.

Suggests holding 80% of what oil and gas represents in the TSX (24-25% position). Gas could perform better than oil. Oil could weaken before it moves up again.

Energy: In the short term wouldn't be surprised to see oil pullback to $100-$110 and this would be a buying opportunity.

Inflation: Not a big believer in the inflationary arguments. The housing bubble deflating in the US is a deflationary event. Inflation is a trailing indicator. Also, unless inflation is seen in wages, it won't be a concern on a broader level.

GMAC (Canada) 5.1% bond maturing Apr 30/09. These yield 10% to 11%. Part of GMAC (US) book is US residential mortgages, which hurt them and reflected on GMAC (Canada), which has no mortgages but is auto financing. Fundamentals for financing in Canada are far better.