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

Market. The market here is going to give you some opportunity to make some money. Wouldn't add to precious metals here because they are so extended on a short-term trading basis but he does have a full position in this sector. Still seeing values in the Canadian and emerging markets.

Banks. These are so cheap that they will move up quickly with the market.

Oil. The next place he sees support is around $80. Would like to see it hold here. Once it gets below this, the question will be, is it a bigger correction. Still a good, long-term place to be but you have to be conscious of your price.

Market Call Tonight. This is a special edition with 2 Experts, James Hodgins and Bill Carrigan.

We have come through this massive debt bubble, focused in the US but really global. Debt to GDP ratio was about 350% in the US in 08. That was the tipping point and Debt could no longer be financed. The rally off the 09 lows has been artificially driven by monetary and fiscal stimulus. He started getting bearish this spring when he saw the end of QE2 coming. He also saw a shift in the political landscape from more stimuli to more austerity.

Market. The key to protecting capital and ultimately making some money is to stay diversified, especially in small and mid-caps. He is a little concerned about Monday where he could see a crash scenario.

Gold stocks generally have under performed bullion for quite a period of time. There will be a time to come back into precious metals but we need to wait until there is more clarity by the Fed as to what they are going to do regarding further qualitative easing. Doesn't expect this to come anytime soon, certainly not before we see some decline in inflation and more economic pain.

Gold ETF or gold companies? He currently likes physical gold rather than the underlying stocks. He has a kind of bearish near-term view on gold because he doesn't think we are at that point yet where we are going to see any more monetary stimulus. When that time comes, possibly in the next 6 to 12 months, feels that gold could really take off.

Uranium. He has been negative on uranium since the Japanese earthquake and he hasn't seen any reason to change his view yet. At some point, emerging-market demands for nuclear reactors will boost the sect or. Current demand is still largely driven by developed economies.

5 Stage Elliott Wave Theory. In a bull market, you have an advance of 5 waves and this is followed by an ABC correction that is usually short, relatively mild and fast. This is where we are now. At the peak, investors are most bullish but when you get to the bottom at the C, there is always fear and panic. He feels we have now hit our low. The current low is at the support of the 2nd peak so he is expecting to find a lot of support.

Darvas Box? This is just a matter of studying a list of the 52-week highs. He does this a lot but he wants to see those that have just hit the 52-week high because the 1st one is probably not going to be the last one.

Gold. Everyone is wondering why gold stocks are not keeping up with the price of gold. Has been in a linear rally since 2000-2001. In the early stages, smaller gold stocks outperformed the metal. In the middle stages of the advance, mid caps and big caps came on. In the later stages, the advances are muted. Mid-tier producers are going to do well.

Corporate strip bond portfolio? It is very difficult, especially in Canada, to buy corporate strip bonds. If you are building a “Strip” portfolio, on ladders they should go out to 10 years at least and even add in a few longer-term if you can find them. This can be handy if you have a child's education in 18-19 years, you can have a strip go out that long.

Bond values will drop when interest rates rise. Doesn't that defeat the whole purpose of bonds? Interest rate cycles last anywhere from 5 to 7 years. This is usually followed by an “easing phase of the cycle” and rates drop, when you usually get your very best year in bonds. You can't just focus in on 1 year.

Skyline Private REIT. Because this is a private REIT, they don't report and are not publicly traded so he doesn't know how they are doing operationally. They tend to have smaller apartment buildings, spread out in southwestern Ontario in the secondary and tertiary markets such as St. Catherines or Goderich.