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

Uranium stocks in general: Not the most liquid market so once buyers decide to step in, they certainly drive the price up fairly quickly. Short term they are a little over bought. We are at a 14-month high. Long term they will do ok.

Lifecos? Manulife (MFC-T), Great West (GWO-T) or Sun (SLF-T)? Insurance sector has been disappointing. Has underperformed financial services as a whole. You need a long-term view for life insurance. If you want a more stable, consistent company then Great West, with a yield of about 5% but if you have a longer term view, she would select Manulife. (She owns Manulife.)

Oil is in the range of $70-$85 and the 2 year outlook is positive.

Silver. If you are positive on gold, then silver will also appreciate.

Some people are totally tied up with the idea of economic disaster. Corporations have fantastic balance sheets with lots of money. Governments are the ones in trouble. Feels safer in buying dividend-paying stocks than European debt. People are saying that all stocks should be thrown in the waste paper basket. The US has problems and it will impinge on our growth in the future. Doesn’t believe in the double dip, even in the US.

Government of Canada 4% bond maturing June 1/41. Feels that interest rates at the government level will fall further because of a deflationary environment.

(A Top Pick Oct 30/09. Up 7.6%.) US treasury 3.625% maturing August 2015. With no inflation threat, he thought the yields were too high compared to where inflation was going.

US or Canadian corporate bonds? Canadian yields are higher because the Canadian economy is stronger and inflation is a little bit higher. You're better off staying in the Canadian because of currency risks.

Little bump up in interest rates – maybe one or two more little increases for the year and then we take cues from the States. Believes rates will stay low for 2 to 3 years, especially in the US. You can get dividend yields quite above interest rates. Dividend stocks look attractive. Investors are paying too much attention to all the noise out there. People need to relax and enjoy their summer.

CHIP Mortgage Trust 4.49% bond maturing Aug 4/15. AAA rated. Essentially they take reverse mortgages and the collateral is the equity. Fairly low risk. Diversified across major centres across Canada.

10 year Ontario provincial bonds at 4% yield. Ontario is a big issuer and will continue to be a big issuer because of its massive deficit but he can't see any default risks.

Effect of a double dip recession in the US on high yield bonds? Typically high yield will be as volatile as equities so if there is a double dip scenario (he doesn't think so), generally high yields would suffer.

Cdn Gov’t bond maturing 2029. Volatile but with rates where they are and the forecast for stable and perhaps declining long rates, they may appreciate further.

Secular trends. 1968-1982 started with nifty 50s and ended with the “new economy”. In between was a sort of clutter. These usually persist for about 12 to 14 years, which include 3 bull & bear markets. The 2nd cycle is usually the big “granddaddy bear”. If 2000-2010 will consist of 3 cycles, the 2nd cycle was completed in 2008 so there is one more cycle to go. Historically the “granddaddy bear” would be 2008-2009. We now have one mini-bear to go and then will move on to our next big upswing which he thinks will be an echo tech boom.

Markets are Schizophrenic right now. With levels of government debt, they can’t stimulate much more. If stock market goes up a fair amount they become richer and are more willing to spend. There are lots of interesting valuations after the correction. Financial, for example. He has invested in 23 of max 25 positions. Has sat back and done nothing with his contra portfolio. NBG-N is something he has bought for his personal portfolio. Could be a 4d or 5 bagger but very risky.