Don Coxe 4/29/11 Conference Call

· Wants to talk about this week’s upcoming election. Initially looked like nothing much would change in Canada’s politics until the debate occurred in French. The socialist party has significantly increased its numbers which is reflective of its left of center views. Although Steven Harper seemed to be navigating and protecting Canada’s economy well during and since the financial crash, the country seems to be looking now to those who are promising new things (e.g., greater taxes on the rich, etc.) It’s a time where somebody who promises an easy way out of difficult times can pick up votes. Most recent poll 72 seats for NPD (sp?) and this could reach 100 seats. Liberal vote has plummeted.

· Implications for investors with this new deal are immense. Money had been pouring into Canada on the view of the great current government who has navigated turmoil so effectively. NPD views would be extremely bad for the energy sector and especially the Canadian oil sands stocks.

· Don cautions investors outside Canada that things may well not remain the same depending on the election. Canada could start looking more like the country to its south where they want to tax the rich, look negatively on oil companies, etc. (Get the impression that Don is concerned with the new investment scenario and that it may well not look as good as it did before the election.)

· For investors inside and outside of Canada it would be a disconcerting event if the more socialist party takes over (I think he is referring to NPD?). (Forgive me my Canadian friends but I am not really familiar with your political parties – trying not to get too familiar with those here in the US either – LOL)

· Food and fuel inflation is starting to show up with consumers. GDP numbers in US was a real disappointment. What could be unfolding is that the US consumer is truly tapped out. They just don’t have the money to spend what Mr. Bernanke is looking for to stimulate the economy.

· What’s happening in Canada may be a sort of lag on what’s happening elsewhere. Voters are discouraged with current government and hope that the new can provide what they promise.

· What is truly concerning for him is the underperformance of the financials. S&P financials are at a new low and underperforming the S&P since July. In the past you would have expected that all the creation of new money would strengthen the financials. Don said he would not be back to real bullishness about the S&P until we see a reversal of this financial trend.

· Lower GDP is due largely to the cut back on spending of the state and federal governments.

· Still believe we should be overweight the raw materials and underweight those using the raw materials. Still believes the commodity stocks are the best place to be.

· Fact that we are getting new highs in PMs every day is the 70’s all over.

· Question raised about ABX’s purchase of Equinox? Don said it was difficult for him to comment on as he knows the people so well. He said it does increase their cash flow although it’s hard on their balance sheet. Seemed to imply that possibly Barrick’s purchase of a copper company means that it has concluded that the gold price may not continue going up sufficiently to support the cost of finding new gold mines which is getting tougher. Therefore, possibly, they may be looking to copper to gain additional growth/cash flow. They must think that visible cash flow from copper will be greater than what they would get from increased cash flows due to mining additional gold. They must then view the China story as one where copper will be a good cash flow vehicle.

· Could you comment on increasing interest rates around the world and where do you see the dollar in a couple of months? Depending on election results next week the Canadian dollar may be quite a bit lower which will help the dollar at least temporarily. Interesting that Saudi’s actually cut production of oil after Libya turmoil which shows that $85 - $90 is the new norm which is what they need to support all their new social programs they need to pay to keep a lid on people’s discontent. (Saudi is going now into price maintenance of oil with 85 – 90 the new normal) Believes there will be higher interest rates around the world except in Europe and US but even then we shall see. (Implications being that US may not want to raise interest rates but may find themselves in a position where they will have to.)

Susan's Comment - without knowing anything about Canadian politics, I can tell that Don is very worried about the outcome of this election and its impact on investors in Canadian companies. He is waiting for the outcome before he considers making any changes in his investment recommendations. In the past he has highly recommended an over weighting in Canadian oil sands.