At the end of his call, in response to a question, Mr. Coxe talks about going long (bond duration) to protect against a market collapse/fall. He said it was still early but thought it made sense. He said he would do a future call on that topic. However, I guess I've assumed that sooner or later, long term rates will go way up in response to real inflation and the fact that the Fed must wring the easy money out of the system to prevent high inflation. I'm starting to wonder if that is correct.

Bill, thank you for the consideration of Canadian stocks - it's always nice when you cover some home ground.

There was an interesting article in Barrons entitled "Messy Mañana for Miners." In the article, Kopin Tan writes about the election next week in Peru (home to many precious and industrial metal mines) and the possible effect on the miners and the metals (metals up, certain miners down)as a result of the candidates' stances on taxation of foreign mining companies. Gold/silver etc. is therefore a good investment (price up) and certain miners will get hurt. Specifically, the article states:

"Peru heads to the polls June 4 to elect a president from two candidates who, as far as mining companies are concerned, might as well be named Bad and Worse. Their real names are Alan Garcia, a former president who once shifted banking-industry control to the government, and Ollanta Humala, who now threatens to slap foreign miners with windfall taxes."

My recollection is that Humala is also a former military leader who got a bit over zealous in fighting the shining path and there was a lot of "collateral damage." The article continues:

"Peru is the world's second-biggest producer of silver, third-biggest producer of zinc and fourth-biggest producer of copper; it accounts for 40% of sales at Denver-based Newmont Mining (ticker: NEM) and about 67% of sales at Pan American Silver (PAAS)."

"Option prices and projected volatility have risen noticeably in Newmont, Pan American, Barrick Gold (ABX) and Southern Copper (PCU). In Newmont's case, for instance, traders have accumulated 0.94 puts for every call outstanding, the highest ratio in a year."

It's unclear whether the candidates will follow through on their election rhetoric but this is something you may want to throw into the mix.

And just to lighten the chat, someone from a brokerage told me about a client who called up and asked about investing in a Peruvian copper company where the president fell out of a helicopter....no names mentioned....lol.

The Bush administration can continue to cook the stats but the world's largest retailer has spoken....

Interest-rate jitters, dollar weakness, Wal-Mart outlook dents

by Steve Goldstein, MarketWatch
Last Update: 7:30 AM ET May 30, 2006

LONDON (MarketWatch) -- U.S. stock market futures were sharply lower on Tuesday, with interest rate fears, dollar weakness and Wal-Mart Stores' disappointing May sales combining to unsettle markets.

S&P 500 futures dropped 6.1 points at 1,276.60 and Nasdaq 100 futures fell 11 points at 1,598.75.

U.S. stock markets are coming off three consecutive gains after upgrades for companies including General Motors and Goldman Sachs, with the Dow industrials ending 67 points higher on Friday.

But Wal-Mart Stores lackluster 2.3% May same-store sales rise - at the low end of company forecasts - dented chances for a fourth rise in a row.

"Wal-Mart continues to see higher gasoline and utility prices impacting its customers, as discussed during its first-quarter earnings call. As a result, the company has seen more pronounced paycheck cycles," analysts at Citigroup said.

Renewed interest-rate concerns were denting stocks in Europe. Many Asian markets, including Japan's, also ended lower. See Europe markets.
Dollar weakness also hit stocks, as markets reacted to increased speculation that Donald Evans, the ex-Commerce Department secretary, will take over from John Snow at Treasury. See currencies. See story on Evans.

The euro rose to $1.2852, and the dollar fell to 111.94 yen.

Data for Tuesday's release include May consumer confidence, seen falling to 100.7 from 109.6%.
Oil futures gained ground, rising $1.33 a barrel at $72.70, while gold futures edged up $2 an ounce to $653.