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

Metlife Bond. A Maple Bond. (?) Yields approximately 5%. Very High quality credit. Double A rated. Considered foreign content in the portfolio, but there is not the currency risk.

BCE Bonds. Sold his holdings because he is not sure how the bid process is going to play out.

Income Trusts are trading about 30%-35% over his model prices. In 2 years, they will have a 30% tax levied. so are trading at what their future earnings are.

Henry made comments throughout the show along with Dean Orrico. Henry was more general while Dean dealt with stocks. Henry's comments: Natural gas and crude prices are rising. This is because all the easy exploration and development have been done, and now the hard ones are left, which means you have to have higher prices to justify the work needed to get at the heavy oil, or the oil sands. Significant commitment to upgrading investment, and refineries around the world. The most aggressive investors are the exporting oil companies. The expansions have been underway for a year and a half or two. Thorium will is unlikely to be a uranium replacement for nuclear power. Towards the end of the year, we will see the first application for the first new nuclear power generation plant. This will trigger several more. Canada oil sands are a unique resource in the world oil supply demand picture. Canada's oil sands represent reserves second only to Saudi Arabia. All of their work identified the Canadian oil sand to be the only location in the world where they are forecasting increasing production as far into the future as you can see. It will be the dominant oil producer in the world over the next few decades. Very large ongoing expansion in ethanol production, and more recently a number of smaller bio-diesel facilities being started, thanks to government subsidies. Ethanol is subsidized to about $44 dollars a barrel, (22 locally, 22 as an import duty), Bio-diesel is subsidized as well. In the case of ethanol, the energy required to produce it is more then can be produced by the product. It's a political solution, not a practical one, not sustainable. There is a mandated ethanol amount in the gas in the US. This is forcing a huge push on production of ethanol which has not been reached yet. In a few months, it will zoom past the mandated levels, and there will be a drop in the price of ethanol, (and corn and soybeans) which will reduce the interest in investors for these alternative fuels.

Gold is contrary, so goes up when the market is correcting. Look at na-marketletter.com to see a number of gold stocks that are listed. (Oh look his name is on the site :)

Gold is the worlds worst commodity. Only one with decades worth of supply.

A paper currencies have been devalued 50% over the last 3 or 4 years. Think of price of oil and goal. Interest rates will go up, all over the world.

Haven't built any new refineries in North America since 1976. A refinery takes crude oil and makes it into higher valued products, the most important one being gasoline used in transportation. 2/3's of crude oil is turned into gasoline. The "crack spread" has historically been about $4, is now $32, because we are demanding more and more gasoline for transportation. That's why there is so much excitement about refining and why he recommends stocks that have a refining component.

This show isn't about stocks so much as emerging markets, so there isn't much stock information available. An enormous revolution in emerging markets, but not as quantifiable. There is more of a maturity in the markets. Her top 3 favorite countries are Brazil, Thailand (3-5 year basis), and Korea. Is negative on the India economy of late. Inflation there is 6.3% (in Canada it's 2.5%)

On Gold. There are big concerns about the US dollar and how far it can fall. In cases like that there tends to be a rush in to gold. At the present time however the Canadian gold sector is acting poorly, because their fair market value is continuing to fall. This might be due to gold being quoted in US dollars and the margins getting squeezed. It's a bit early to buy gold, but he has one in his top picks.

A caller was asking if that because the Canadian dollar has been running so hard, it might be a good idea to go into bonds to preserve capital. He replies that it's not a bad idea, but don't go too far out with it, because inflation is rearing it's head, and if the States decides to lower it's interest rates who knows what will happen. He says don't go into US bonds, but a 5 year Canadian bond is a good idea.

Canadian dollar is going up. People are buying companies which affects the Canadian dollar. Recognize when it's over. don't predict when it's over.

Our apologies for the site being down. Looks like we're back on track. Thanks for your concerns.

Price of gold, predicts that it will go over one thousand per ounce in a couple of years, based on US weakness.

(A Top Pick June 14/06. Up 2.1% plus coupons.) Government of Canada 2029 bonds. Rate of return has always been about 12%. He loves the fundamentals of the Canadian economy.