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

Natural gas. Chart shows a long decline from 2008 to the present. Probably one of the most volatile commodities that is actively traded. He would avoid this commodity and natural gas stocks.

Natural gas is a bit confusing. He has stayed away from the commodity as much as possible. Sees no fundamental reason why it will be a whole lot better next year. There is still ongoing supply growth in the US.

Oil. A lot of oil weighted projects make sense around $85. He gets worried when he sees it too much ahead of $100. He sees in the $70 range as a good floor.

Recent craziness is up and that is good. If we get increased clarity that EU has a plan to deal with the crisis, that maybe this rally is sustainable. If companies confirm there is continued profit growth that could be a catalyst for stocks to continue going up. Investor confidence has to be restored. Economic data from US confirms we will not go into a double dip. Clients’ cash levels are still relatively high but they have done some buying.

Markets. Since the 3rd week of August we’ve been in deflation. It's not about stocks, but about government policy, especially in Europe but will soon follow in the US. What is hopeful is that there has just been a big uptick in 10 year yields.

There is so much volatility in the global markets. Look through the noise. The non-farm payroll numbers showed some nice stability but some growth. There had to be some follow through bullishness on that news. Europeans are acting vs. reacting but market is pricing in a default so it is not a factor. Numbers out of Europe are not that bad. Seasonally the next two months are usually a rally in the market. Sees a bit of a recovery and a movement upwards. Dividend paying and utilities/REITs have done so well. They are almost a safe haven. He is more neutral on REITs now because they have done so well. Thinks there will be a sector shift out of the interest sensitive stuff.

First Capital reality 5.34% 2013. Extra 2.5 points above Gov’t of Canada. Very good at executing and developing own properties. Investment grade bond. It is hard to find value in the bond market.

Markets. Since 1924, the S&P 500 has gone down 8% or more in the 3rd quarter on 15 occasions. On average, the 4th quarter gain was 4.9%. We just had a very important inflection low earlier this week. We are lined up for a classic move in the 4th quarter. Next week we get the start of ¾ reports and they're going to be terrible. Markets will already have anticipated this and stocks will start to move on the upside on really bad news.

Historically it has shown a classic support level at its 200 day moving average. Since 2003, the 200 day moving average has been just below the price of gold. Last week, it came all the way down to the 200 day moving average and then popped again. Looks like we have a very important intermediate low as of last week.

Moving averages? The traditional one you want to use is the 200 day moving average. The other one is the 50 day moving average. Currently most markets are below this. If you see the markets moving above the 50 day in the next week or two, that is very positive.

Is the Dow theory still relevant in today's market? The theory is, if the Dow industrial and transports are trending in the same direction, that is considered to be bullish. Not a big believer in this theory. It works sporadically. Hasn't worked too well in the phase that started in 2000.

Technical analysis. With the wild market swings, is it still relevant? From May until now is the time of the year when volatility is the greatest and the time when you should hold a lot of cash. Watch the Volatility Index (VIX-I). Historically, when it gets above the 40% level and peaks, that is a really good sign.

Interest rates being at an all time low are making dividend yielding and equity more attractive. The reason the interest rates are low are concerns about the slowing global economy.

Markets. Thinks the markets were very oversold as there was very negative sentiment in the marketplace. Expect this is being cleared up right now but that was not necessarily the low. A lot of the issues that were causing this are still here, so this is going to continue. We need some real action from Europe. He is actually buying companies with good dividends in this marketplace. Companies are in great shape, its governments that are in bad shape.

Silver. Feels the outlook for the next six months is up. Silver is okay at this price.