June 7, 2010 Good Morning:

Fiscal Stimulus

An article yesterday titled 'G20 drops support for fiscal stimulus' (click here) says G20 Finance Ministers "ripped up their support for fiscal stimulus on Saturday, recognizing that financial market concerns over sovereign debt had forced a much greater focus on deficit reduction".

This strikes me as significant in circumstances where I think one has to seriously wonder where the world economy and individual country economies (read the U.S. in particular) would be today absent the extensive government stimulus spending that has occurred after mid-2008.

I am seeing increasing commentary suggesting that the U.S. Stimulus Packages have been very important to what many U.S. economists portray as 'U.S. economic recovery' - which if true to me means anyone who believes in meaningful near (if not longer) term U.S. economic recovery ought to 'give their heads a shake'.

This is something I think equity investors, including those who invest or trade in resource stocks, should carefully consider as (in I think an ideal world) they take more and more responsibility for their investments.

U.S. Sub-Prime An article titled 'Why Coming (U.S.) Option ARM Crisis Will Send Gold Higher - Much Higher!' says:

•about $750 billion worth of U.S. Adjustable Rate Mortgages ('ARMs') were issued between 2004 and 2007 and will begin resetting shortly;

•this will result in an approximate doubling of monthly payments of homeowners with ARMs;

•in combination with higher unemployment, U.S. home mortgage foreclosures will increase; and,

•this will to be a major drag on U.S. economic recovery and will send the price of gold higher.

Best Regards, Ian R. Campbell

President

StockResearchPortal.com