I could cite a lot of statistics but suffice it



to say Asia is booming. Europe is growing and so

are Latin America, Australia and Canada. Of the

major countries only the U.S. is sluggish.

The world economy is growing and growing very

fast. In our opinion it is not time to fear. It

is time to "seize the day", "make hay when the

sun shines" and all of those trite but true

sayings that have persisted because they

correctly describe an era of opportunity. If

there is a cloud on the horizon it is the

potential for inflation, not the problem of

slowing growth.

THE CONVENTIONAL WISDOM

The conventional wisdom is that the U.S. will be

unattractive for investment during the summer due

to rising interest rates, the subprime mortgage

crisis and the fact that the stocks have risen

enough in the last few years. Many in the U.S.

think that if the U.S. market is unattractive,

then the world must be unattractive.



NOTHING COULD BE FARTHER FROM THE TRUTH

We do not watch markets per se but rather we

watch economies and the growth of sectors of the

world and national economies.

It is clear that globally, many economic sectors

are in stunningly good shape. Basic materials,

energy, industrial products, farm products,

commodities, transportation products and defense

products are in demand worldwide.

There are many opportunities in the countries

that are growing rapidly throughout Asia,

Australia, Canada and Eastern Europe.

CURRENCIES

The dollar is going to start to decline in the

not too distant future and we continue to favor

other currencies than the U.S. dollar.



ENERGY

A FEW OBVIOUS POINTS ON ENERGY

1. OIL WILL NEVER BE CHEAP AGAIN.

2. GLOBAL DEMAND increases about 2 per year. Non OPEC

suppliers make up the difference. The question

is how much do non OPEC suppliers have and how

much are they willing to sell to others? We

believe they will hoard more and more of their

production, further exacerbating the oil price

increase.

3. ETHANOL WILL NOT HELP IN A BIG WAY.

Ethanol is a political carrot thrown to the farm

lobby. Ethanol will increase farmers? income by

transferring money from all the other citizens to

the farmers? pockets. As we have written in the

past, it will be ineffectual and very costly on

several levels. For ethanol to have any impact

on oil demand and help lower energy prices, the

amount of corn and other materials required for

cellulosic production would cause food prices to

rise.

4. SOLAR AND WIND WILL PROVIDE SOME ENERGY SUPPLY.

However, believe it or not, most of our power

when the oil runs out will come from nuclear and

coal.

5. There is the possibility that solar panels

can be made more effective allowing solar to play

a bigger role.

OIL AT $100

1. We still believe that oil will go to $100 over

time. If we get some explosion in the Middle

East or an expansion of the continued problems in

Nigeria, it could be at $100 in 2008.

2. Today, oil is harder to find, demand is

increasing and supply is diminishing; thus, the

price is rising.



OIL SERVICE COMPANIES

We favor those companies who are OUTSIDE THE U.S.

AND IN DEEP WATER, where the biggest demand will

be in coming years.

We own deep water drillers, floating production,

storage and offloading companies who operate

offshore facilities and we own high tech seismic

companies serving the deep water market.

Recent declines in the price of some oil service

companies and deep drillers are a good buying

opportunity in our opinion.



METALS

Fear has spread that a slower U.S. economy will

cause demand for gold and base metals to diminish.



We could not disagree more. The dominant

variable impacting the price of gold and base

metals is global economic growth. Gold goes up

when the global economy grows because more people

get wealthy and use gold in jewelry and for

hoarding (to protect themselves from the

insecurity presented by certain government

behaviors). Confiscation of assets, uncertain

economic outlook and weak currencies are among

the many potential government created problems.



IN OUR OPINION....OPPORTUNITIES ABOUND

We see many opportunities in the areas of our

focus. We will use all declines as buying

opportunities, and we believe that the next few

years will continue to provide good profits in

these areas just as the last few years have.

We are concerned about inflation over the longer

term. Historically, inflation is good for metals,

energy and also for foreign nations that have low

production costs and can pass along price

increases.

Therefore, most of our favorites benefit today

and will continue to benefit if inflation arises.

For More information on global investing visit

http://www.howtoinvestglobally.com

For More information on Guild Investment

Management Services visit http://www.

guildinvestment.com

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