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

US Banks: Not so sure that all the write-offs have been completed as yet.

Market Outlook: Actually quite bullish. Reaction to what is going on in the economy is overdone. Historically it can be proven that the market does well whether we go into a recession or not. It can be rocky for the next couple of months but if you are an investor over the long run, you have to be optimistic. Sitting with about 7%-8.5% cash.

Canadian Banks: - Given that 10-year yields are 3.9% and you can get 5% on a number of these banks, it's a steal of the century. They will continue to earn a significant amount of money. Balance sheets are in very good shape. Until the Commerce (CM-T) and Bank of Montreal (BMO-T) disclose their full exposure and the risk is, he doesn't think these stocks can go up. Over the short run, there could be some hurt.

Gold: - Bullish on this commodity. Demand will come from Asia as their economies continue to grow. Can easily see the price of gold going through $1000 by this time next year.

Growth vs. Value: 2007 was the 3rd worst year for value investors, so it has been a tough year for them. Could be entering a period when growth outperforms value, but you can still make money in value. If you buy good companies that 1) pay nice dividends 2) have pristine balance sheets 3) cheap and 4) have strong management, you're going to do okay.

The risk of owning BCE Bonds is priced in. He thinks the deal will go through in the 2nd quarter. If the deal doesn't go through, these bonds could be upgraded to investment grade.

Good time to deal in US bonds as long as they are not treasury. Yields on the treasuries are low because of the flight to quality. There are some very good values in short-term financials as long as you stay high up the food chain such as AA or very solid financial institution.

On bank preferred stocks; stick with 2 or 3 of the top banks that have avoided a lot of the structured investment vehicle issues and mortgage and credit problems. These would include Toronto Dominion Bank, Royal Bank or Bank of Nova Scotia. Pick variable and fixed rates. Find ones that are fairly liquid, as some of the illiquid ones don't trade well.

GMAC and Ford Credit bonds have yields exceeding 10%. You are getting this yield because you are taking on a lot of risk.

Bank of Nova Scotia 4.56 % bond maturing October 30/13. On a yield curve, he loves the 5 year area. Not a lot of risk. You can basically hold this bond until maturity. AA rated. One of the best run banks in Canada.

George Weston 5.05% bond maturing Mar 10/14. You're looking at a yield of over 6%. Treasury bills are yielding in the mid-to high 3%’s. You can hold this bond until maturity. Investment-grade. The majority ownership in Loblaws (L-T), which he thinks is a turnaround story.

GE 5.1% bond maturing June 1/16. Extremely high quality. AAA. One of the largest and most diversified companies in the world.

Technology Stocks - He would be very cautious on any technology stocks until there is some kind of a bottom on the semiconductors.

OIL - Chart shows an uptrend from August on, but a wedge is forming, which is short term bearish.

Junior Golds - Thinks we are relatively early in the big picture of gold. Past year had a disconnect. Price of gold went up 31% and yet the juniors as a whole did very poorly. There were speculative opportunities away from gold that attracted more attention. Believes the gold price will hit $1000 and will have a salutary effect on the juniors.