Don Coxe 8/18/11 (Thursday) Conference Call

· Without effective model for valuing assets you inherently increase your risks of investing in the stockmarket.

· Gold story is a story that is benefiting from all most everything going on including pressure on swiss franc which they are trying now to hold down. Euro, dollar, yen and swiss franc are the primary currencies. When it looks like paper money doesn’t have value then system gets quite dangerous. Meeting this week with sarkosky and merkel was a big disappointment. Difficult now to show the value in the euro.

· There is now a risk to the financial system itself which means we are no longer just looking at GDP numbers to determine stock market. Basic rules of investing and running governments are coming under attack.

· Deer came out with great numbers and future forecasts and their stock got hammered being down 7% on Thursday. This is saying that the “market is losing its sense of self.”

· With crude now down, it means the only real inflation that will hit the consumers is food. This could really help us. Means this is different right now than ‘70s. What it does mean is more and more money being spend on commodities compared to rest of the markets. Yet financial gurus are downplaying commodities. This is based on their predictable models but don thinks those models are not applicable still today.

· What can change this back to normalcy? If money supply slows down and if banking system starts to look good this would be a good indication. But European financial sector is in bad shape, even worse shape than US.

· Meanwhile Canada remains a relative sea of calm but its difficult given how its connected to rest of the world. Canadian dollar now back at par. Don thought that it would be much higher so he was wrong on that call. Dollar as an alternative to yen and euro is looking good.

· What’s amazing is that the Treasury market is having a great bull market and right after the S&P downgrade.

· What you do is try to remove or lessen the risk and what you do not do is believe those who say gold is in a great bubble! Don said “come on” its not. Gold is the safe haven asset.

· Silver is playing off of that and it is looking good certainly compared to those euro bonds.

· We are adrift as to what the rules are. You are though owning really great stocks paying great dividends.