1. QUARTERLY
An exclusive newsletter from Mark J. Krygier, LL.B., CFP
Vice President & Portfolio Manager
June 2011
Volume 14, Issue 2
“There will be no need for a
Good bye QE 2, it was nice knowin’ ya!
second bailout in 2012 and we’ve Later this month capital markets will begin to digest the impact of reduced
made that absolutely clear.” stimulus by the U.S. central bank through the end of the second bout of Quantitative
Easing or “QE II”. While this artificial stimulus has been a boon to stock holders,
Mr. Enda Kenny the liquidity created as the U.S. Fed has been buying Treasury bonds will not in
Prime Minister of Ireland practice stop anytime soon. Market strategist Dennis Gartman points out, “the fact
that the Fed will be reinvesting its stream of coupons back into more Treasury
securities means that QE II is really QE II+.” The question many ask is how then
Did you know? can the Fed manage its balance sheet, as “losses” keep mounting on the value of
Gold is on the minds of many
investors, as evidenced by a “cash for these Treasuries corresponding to the rise in interest rates since the beginning of QE
gold” store on every other corner. II. The answer to this is the same as it is for regular investors who hold individual
According to the World Gold bonds or other fixed income securities in their portfolios – such “losses” simply
Council, the nations/entities which don’t matter. While day-to-day valuations are affected by rising interest rates if, like
own the largest sums of gold are (in
billions): The U.S. at $372, Germany
the Fed, you hold your bonds to maturity – you recoup your capital!
at $155, the IMF at $128, France at Being a hedge fund manager isn’t so glamorous these days, as yet more
$111, the SPDR ETF at $59, and
China at $48. It is interesting that the
managers leave this once popular and lucrative field. The last couple of years have
IMF is the third largest holder and the seen Stan Druckenmiller, of George Soros fame, leave his job out of frustration at
gold ETF is the sixth largest! being unable to generate superlative returns, Ken Griffin of Citadel cut his
management fees, and more recently the famed Carl Icahn returning outside
To reach me: investors’ money after being troubled by losing so much in the 2008 crisis. Then
there are those, such as Raj Rajaratnam, head of the Galleon Group, who have left
T: 416-512-6441 the profession unwillingly, after being convicted of insider trading charges for
mark.krygier@td.com illegal trading on stocks of some of Wall Streets largest public companies. Perhaps
such stories represent a general malaise in expected returns in today’s economic
Or call:
Avital Pearlston, CFP
environment that don’t justify the risk, stress or fees of these highly publicized
Associate Investment Advisor funds. Perhaps, in this age of deleveraging, some are beginning to recognize that it
T: 416-512-6674 is hard to achieve extra-ordinary returns without using “extra-ordinary” means.
avital.pearlston@td.com Bottom line – If investing is viewed as a get-rich-quick scheme then any “means”
may be viewed as justifying the ends, but if one recognizes that it takes time to
The Madison Centre
4950 Yonge St., 16th Floor
create wealth, then having patience, using sensible business acumen, and not acting
Toronto, Ontario M2N 6K1 out of fear or greed will surely provide reasonable longer term results.
1-800-382-4964
CAPITAL MARKET HIGHLIGHTS
 U.S. housing prices are still deflating as a massive supply glut will continue to exert downward pressure on prices.
 Canadian interest rates were once again held steady with rate increases unlikely before the fall of 2011.
 Japan’s credit rating has been downgraded following the negative economic impact of recent earthquakes.
 The Euro has been very volatile as the EEC grapples with Greek debt problems, with Ireland, et al., not far behind.
 Canadian bank earnings were mixed vis-à-vis investor expectations, as a slowing economy affected profitability.
WHAT TO DO NOW?
 Economic challenges mean investors have to be prudent in positioning their investments and to have some patience.

2. FINANCIAL SUCCESS SOLUTION$ - Estate Planning 101: what is involved?
Recently I heard a wonderful presentation from a Private Trust Manager of TD Waterhouse Private Trust outlining the
items we all need to take care of when considering estate planning – an often overused term. The issues that need to
be resolved and dealt with in one’s lifetime, to avoid future family conflict and to avoid chaos for one’s heirs include:
 Inventory and transfer of assets – this is the number one area that creates family conflict if it is not clear and reasonable.
 Planning for the impact of family situations (i.e. multiple marriages, dependant adult children).
 Will preparation – to avoid the problems of intestacy, delays in administering the will, extra costs and additional taxes.
 Choosing executors – this is often a more arduous task than one might imagine so be sure you have the right people.
 Planning ahead to minimize taxes – a Will creates opportunities for tax planning which cannot be done retroactively.
 Powers of Attorney – if not done in advance, people other than your trusted loved ones will be making decisions for you.
 Other considerations, including insurance planning, funeral arrangements, etc.
People who plan ahead leave their heirs wealthier and with less stress and conflict in their lives.
Speak to your professional advisors to help you deal with these issues, or if you need a referral to an advisor call us directly.
STOCK WATCH ETFs TO WATCH GLOBAL BENCHMARKS
(In Canadian Dollars to May 31, 2011)
CANADA
I-Shares S&P/TSX Capped
Canadian Natural Resources – Financial Index - XFN (TSX) -
CNQ (TSX) - $42.17 $24.45, Dividend yield: 3.2% Asset Class YTD 3-Year
Year High: $50.50 Low:$31.97 In Brief: This ETF offers a low S&P 500 (USA) 4.6% 0.1%
 Independent oil and natural cost and liquid way of accessing NASDAQ 3.7% 3.1%
gas company with the Canadian financial sector. TSX 60 (Canada) 3.6% -0.8%
operations in Western Some of the benefits of this ETF: MSCI Europe 5.8% -8.0%
Canada, the North Sea and  No guessing which bank MSCI EAFE 1.4% -7.7%
offshore West Africa stock will outperform. China Shanghai -3.3% -5.9%
 CNQ has raised its dividend  ETF’s are bought like a stock
for 11 straight years. Brazil Bovespa -4.9% -3.7%
so pricing is transparent.
 Leading production growth  74% is held in bank stocks, MSCI World 2.7% -4.7%
amongst senior producers. 21% in insurance companies, 3-mo. CDN T-Bill 0.4% 1.0%
Risks: Changes in oil prices or and 5% in other financials. 5-yr GOC Bonds 2.0% 5.2%
the regulatory environment. In summary: This ETF is suitable U.S.$/CDN$@0.9685 -3.0% -0.8%
for those wishing to get instant (% change)
U.S./ INTERNATIONAL diversified exposure to the
Apple Inc. strong Canadian financial sector. Diversifying asset classes is the
AAPL (Nasdaq) U.S. $347.83 first step in managing risk!
Year High: $364 Low: $235
 One of world’s largest
manufacturers of computers MY THANKS: WHAT AM I UP TO?
and other consumer To Nadine D., Harry Z., and I accompanied an Advance Level
products. Galina U. for referring my (ALS) paramedic on a 12-hour shift as
 Problems at RIM and Nokia services. If you know someone - part of my continuing education
could improve market share family, friends or colleagues - who requirements as a voluntary paramedic
 400% sales increase into the may be able to use some within a local organization. The
important Chinese market. assistance with their investment number one feeling I came away with
 Strong balance sheet. planning and you think that I can by the end of the shift was the sincere
be of some help, contact me and I dedication to patient health by all of the
Risks: Competition is fierce and would be pleased to call and meet health professionals I encountered,
Steve Jobs is on medical leave. with them personally. which was highly encouraging.
The information contained herein has been provided by TD Waterhouse Private Investment Advice and is for information purposes only. The information has
been drawn from sources believed to be reliable. Where such statements are based in whole or in part on information provided by third parties, they are not
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