Hi All,

First off a belated Merry Christmas and of course a Happy New Year to all of the NOT brothers and sisters.

2008 will go down as Noront's best and worst year. Having seen a new SP high in the first half of 2008 only to see the massive market selloff and oversell in the last half. I still cannot get my head around the current share price but when I look at every other stock I am still very happy to be holding a large percentage of my portfolio in Noront.

To know that the company has 40+ million in the bank to keep this baby going for a few years is comforting in this very unsteady market. When asked by others about how NOT is doing, I always answer the same way - "Surviving in this market, undervalued given the assets, and able to stay afloat for two years when many others will be going under.

The importance of this cannot be understated. Cash is king when in recession/depression and Noront has a lot of it. When other juniors begin to drop off the exchanges, those remaining will be good buy targets for the eventual return of the bull.

Some thoughts on 2008:

- I believe the board came together during the Proxy fight and market crash like never before. It is easy to be hopeful and happy during the good times, but during these two crisis' I believe a lot of longs were encouraged by the commoraderie on this board in light of the doom and gloom picture painted by the media.

- Markets move be fear and I have never witnessed as much fear mongering related to the ecomony and the financial systems as we saw in 2008. To have the likes of Suzie Orman and Jim Kramer (the mad money guy) go on national TV and tell everybody to sell all of their stocks was tantamount to economic treason. It does not matter what market one is in, a flood of supply will always kill price. Add to that the shorters who smell fear and add to the supply and it was a perfect storm for a 75% market drop.

- I hold the opinion that the market is massively oversold and most stocks are undervalued if one holds that the continued crisis will not continue for longer than a year or so. Apple is still selling IPODs, Esso is still selling gasoline, and many of the commodities that exist are still being used in manufacturing, though the level of production has dropped off.

Imagine if you will that you lived in a Neighborhood where you built a house for $250,000 and over two years it increased in value to $400,000. If a year later two neighbors on your street lost their jobs and were forced to sell their homes to the highest bidders, and if there were no buyers, would a sale of one of the homes for $150,000 mean that your house was worth $150,000? According to some I suppose. If the next guy sold his for $125,000 because he overleveraged by owning two other properties using this one as collateral for the other three, would that mean that your house was worth $125,000 now? What if the replacement cost for the materials and labour alone was $200,000?

Now picture if a third house sold for $50,000 and that was the stat showing in the newspaper today. Would anybody else sell for that price? Would anybody buy? Only those with cash I suppose as the others have mortgages worth more than the house.

That is where most of us are today with Noront and the current share price. Sitting on an asset we paid much more for but that has been knocked down in price due to desperate selling, overleveraged sellers, and a fear media that has scared the average guy from dipping their toe into the market. Most are on the side line renting rather than buying.

- Ignore CNN and American media for a moment and look at the economists world-wide, and you will see that GDP for most areas outside of N.A. and Europe look pretty good for 2009. 6% for China, 7% for Russia, 5% for Africa, 4% for India. These are major up and coming economies that still require our raw materials. Yes, the automobile and forestry industries are hurting and commoditiy prices have dropped but the world did not end in 2008. The problem with the current financial market is a liquidity one, not a fundamentals one.

- Liquidity - the source of all our woes in 2008. Yes the sub-prime mortgage fiasco created through poor policies under the Clinton administration and democrat held senate in the late 90s created the seeds for the mortgage crisis, but for the amount of mortgage dollars at risk, the damage created by the lack of trust among US financial institutions and then world wide financial institutions was 20X as damaging and drove trillions of dollars of paper equity out of the markets.

When GM of General Electric cannot get financing from major institutions to finance their sales, things are really bad. Canada was not as vulnerable due to our centralized banking system and power of the Bank of Canada over bank lending rates and rules. To see the US cut their prime down to .5% with no impact on liquidity tells me that the 1000s of independent banks are not trusting each other with loans that they normally float to one another. Every bank has their money in a mattress in the US and we all know what that does to an economy. Hearing that car dealers have to turn away customers as they cannot secure even a secured car loan on behalf of their good credit customer shows just how bad this hoarding of capital and lack of trust has become. Look for a centralized banking system (now that they are close to a centralized mortgage system) in the US if this liquidity issue does not sort itself out in 2009.

- In 2008 I believe we saw the hedge funds take such a beating that this could be the dawn of a new investment paradigm. As their beating and margin covers had an impact on the rest of the economy, new legislation, similar to what was enacted in Australia over shorting will likely see its way into both NA and Europe. How one can prosper by dumping other people's assets on the market has always amazed me. Borrow my share today and sell it so that you can buy it back much cheaper tomorrow by triggering a sell-off. And do it without my knowledge and leave me wondering why my share is worth 25 - 75% less for no fundamental reasons normally associated with business failure. It still blows my mind and now the minds of those who have turned a blind eye to it in the past.

The value of my portfolio may stink at the moment, but at least I was not forced to sell to cover a margin or a leverage call with another institution. The banks and funds fell like dominoes and unfortunately our portfolios were forced to follow. But we at least hold the paper until such a day when demand and value return to the market.

- Finally, do not fret about the price. With three years of a bull market between 2005 and 2007, a lot of capital gains taxes were paid out over those years. 2008 was a year of substantial loss and anybody who paid CG tax in the past three years likely sold for a loss in late 2008. Again, a large supply dumped on the market in order to claw back past years paid taxes on gains. If a stock loses 10% in a year, my guess is that very few tax loss sales occur on that stock. But when the TSE and TSX both drop 75%, rest assured that the losses would have become real on sale in order to get the clawback. This sell-off increased supply in the market again and thus lowered prices, contributing to the over-sell.

- I look forward to 2009 for many reasons. One is that Noront will continue to drill and with each assay brings new future returns. Secondly, the new TFSA (tax free savings account) that the Conservatives are bringing in tomorrow allows Canadians to contribute $5000 to an account whereby the profit when withdrawn from the account is tax free. Unless you have to claw back capital gains, this is a sure win, even at this low amount. While some will use it to get their 1% return at the bank, I believe it will attract a new brand of investor looking to profit in the short term and not wait until retirement (RRSP). Mutual and self directed funds will pick up as demand increases for assets for these accounts. I for one will be setting aside $5K for Noront in one of these accounts as what could be better than buying low and not having to pay a cent of tax when this stock rebounds in the upcoming months and years.

Anyway, it was quite a ride this year but we still hold an investment in what is one of the shining lights in the Canadian Junior market. Long term hold are the words of the day and I wish everybody on this board health, wealth, and prosperity in 2009.

M1.