This week…

• The S&P 500 continued its recent rise and is now just shy of the highs of 2007. The NASDAQ made further new highs as did the Dow Jones Industrials who flirted with 13,000 this past week.

• The Fed saved the bonds from a down week with a large buy program on Friday. Could Greece default and withdraw from the Euro? A short discussion under bonds.

• Gold broke out and rose to its best levels in weeks. Further up moves are expected. The US$ fell and the commercial COT’s of the Euro and the Swiss Franc suggest that further declines for the US$ is probable.

• Oil broke out on fears of a conflict against Iran. Some important points to keep in mind about Iran are summarized.

D.C.

Chart of the Week – Gold CPI

Stock of the Week – A way to invest in oil

This week…

• Signs continue to point to a solution in Greece and an improving US economy. This in turn helped push the S&P 500 higher for basically the 9th week in a row. The DJI and the NASDAQ made new highs above the May 2011 highs. The S&P 500 is just below those highs. New highs are expected.

• Bonds were very quiet again this past week although the US Treasury bonds were left clinging to an uptrend line. Expect that line to be broken this coming week. An improved economy and QE in the background plus the expectations of a solution in Greece are pushing bond prices lower (yields higher). This i s despite the well known fact that the short rates will remain unchanged into 2014.

• Gold eked out a gain this past week but as of writing gold appeared to be poised to break out of a flag formation. Similarly silver appeared to be poised to break out of a pennant formation. These formations are bullish. The catalyst was a falling US$ and further threats of an attack on Iran.

• Oil prices rose sharply this past week as an attack on Iran moved closer to reality. As of writing on February 20, 2012 oil prices broke through $103 and were as high as $105 all on the Iranian situation. Iranian warships sailed through the Suez canal to Syria. There is also the question of Iran’s oil for gold and/or Yuan program. Iran cut oil supplies to a number of a European countries as a reprisal against sanctions .But Iran was booted from SWIFT an international payments system. This is not positive for the country as effectively it becomes very difficult to settle any financial transactions. Unless an alternative rises. China perhaps?

• The TSX was higher this past as energy stocks helped propel it higher. Energy and commodity stocks (primarily gold) should push the TSX higher again this coming week as the gold and oil rise.

Note: Next weekend will be a shortened commentary only as we are tied up all day Saturday in meetings.

D.C.

Chart of the Week – Gold/Oil ratio

Stock of the Week – An uranium stock

D.C.

This week…

• The week was actually kind of “boring” with only minimal movements in most markets. The S&P ended a winning streak given the uncertainty with the Greek debt settlement. This was against a backdrop of riots in the streets of Athens as the people revolted against the imposed austerity measures. These riots could yet turn even more deadly. The muted decline in the stock market suggests that there appears to be some expectation that a settlement might be found. The settlement as suggested here many times should include QE as it remains the only tool for the monetary authorities to try and save the financial system and as they say “kick the can” down the road.

• US bonds were just as “boring” as they awaited the Greek settlement.

• If there was an area that was negatively impacted it was gold and silver but even their decline this past this past week appeared only as a pause following a number of weeks to the upside. The gold stocks appeared to be more spooked. The US$ was down but managed to eke out a small gain not because of a falling Euro but because of weakness with the Japanese Yen.

• Oil prices were up but the stocks were mixed with the XOI up and the TEN down.

• The TSX Composite was down mostly due the weakness in golds, energy and metals.

D.C.

Chart of the Week – Euro rising, US$ falling. Isn’t it supposed to be the other way around?

Stock of the Week – Board battle at a Canadian blue chip.

D.C.

Chart of the Week – When is a default not a default?

Stock of the Week – Junior miners on the upswing

D.C.