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CANADIAN STOCK EXCHANGES AUGUST, 2009 E. A. SCHILLER
HOLDERS OF GOLD AND FERTILIZER WILL MAKE THE RULES

We all know the golden rule. He who has the gold makes the rule. Moving from this rule to an agriculture rule, it will soon be, "he who holds the fertilizer feeds the people will make the rule". Currently consumers of fertilizers are reluctant to pay premium prices and there has been a lowering of prices from some producers. This summer Russian producer Silvinit sold Indian Potash Limited potash at US $460.00 per tonne, and days later it was reported that Israel Chemicals sold potash at the same price to India Potash.

This was followed up by Canpotex, the marketing arm of Potash Corp, Agrium and Mosaic who similarly sold 850,000 tonnes of potash to Indian importers for $460.00 per tonne with an option to sell another 20% at the same price to March 2010. World- wide population growth cannot be impeded and neither can people's desire to eat. To sustain the growth of all agriculture products whether it be to feed individuals or feed animals that individuals eat those products need nutrients in the form of nitrogen, phosphate and potash and other trace elements. Nitrogen and phosphate are readily available throughout the world but potash is limited to a few selected places on our planet. And Saskatchewan is blessed with the largest source of potash in the world and currently is the source of 35% of the world's production.

Prominent fertilizer stocks include Canadian potash producers Potash Corp (POT-TSX & NYSE), Agrium Inc (AGU-TSX & NYSE), Mosaic Company (MOS-NYSE) and US Intrepid Potash (IPI-NYSE), nitrogen producer Terra Industries (TRA-NYSE) and nitrogen and phosphate producer CF Industries Holdings Inc. (CF-NYSE - Agrium Inc has a current offer to acquire CF Holdings for US $40.00 in cash plus one Agrium share per CF share until August 19, 2009). These six companies are the fertilizer rule holders and any prudent investor should have one or more these companies in your portfolio. From all time highs in 2008 of POT of $245.00 to $105.00 in July, 2009 and Agrium from $115 in 2008 to $47.00 in July, 2008 and similar price reductions of the other fertilizer company's one can assume some blue sky on the horizon when this market decides to turn around. The fundamentals of the fertilizer industry have an optimistic outlook - 1) the rise of the middle class in China and India, 2) increased demand for ethanol from all agriculture sources and 3) expected mergers and acquisitions in the industry.

Returning to the Golden Rule there is one individual who lives by this rule and he is Robert R. McEwen, founder and former chairman of Goldcorp Inc. (G-TSX) who took this company from an initial $50 million and catapulted it to a $10 billion company. He has since moved on and is involved in several junior companies. In a recent interview he predicted gold will be $2000 per ounce in 2010 and $5,000 per ounce by 2014-15. Will his midas touch continue? Replicating a Goldcorp is no easy task but one Red Lake company that I like is Premier Gold Mines Limited (PG-TSX-V). For starters the company is headed by gold explorer Ewan Downie who has had several gold discoveries under his belt. The company is moving ahead on the very promising Hardrock prospect located in the Beardmore-Geraldton Greenstone belt of Northwestern Ontario. The Hardrock project comprises a 15 km long property package that overlies more than 3.0 million ounces of past production in a district that has historic production in excess of 4.0 million ounces.

The Project is operated under a joint venture with Roxmark Mines Limited (RMK-TSX-V) (Premier has holds a 70% interest). The current program now underway has a planned $8 to 10 million exploration program comprising 50,000 metres of diamond drilling. Several highly prospective target areas have been identified including the SP Zone (South Porphyry Zone) that recently gave an impressive 23.36 g/t gold over 5.4 metres within a much larger zone of 6.60 g/t over 32.6 metres. In late July the company announced a 9.5 metre intersection grading 17.16 g/t within the zone. This SP Zone was partially mined in previous years and yielded 264,354 tonnes of ore grading 8.37 g/t gold. Intermittent historic drilling that tested the unmined down-plunge extension of the SP Zone suggests the potential to outline mineralization over a plunge length of nearly 3.0 kms. To date drilling has established gold mineralization over a strike length of 650 metres and to depths approaching 200 metres in the central portion of the deposit. Premier stock trades around $2.70 up from around $2.00 in April. Roxmark trades around 15 cents up from 10 cents in June.

With the energy crunch upon us alternate forms of energy is becoming a hot topic and worthy of investor interest. Another successful mine finder has broadened his horizons and this is Ross Beatty of Pan American Silver fame. Ross has created Magma Energy Corp which is a geothermal company actively engaged in operating, developing, exploring and acquiring geothermal energy projects. They have one operating power generating plant at Soda Lake Nevada and an extensive portfolio of projects throughout the western US, Chile, Argentina and Peru. In July they announced the acquisition of a minority interest from Geysir Green Energy in HS Orka, a large producing geothermal company in Iceland. Iceland has one of the world's largest and best developed geothermal industries, supported by substantial geothermal resources and a highly skilled workforce. Geothermal energy accounts for 23% of Iceland's electricity demand and powers many of Iceland's homes and businesses, including Iceland's large aluminum industry.

Through this acquisition Magma's direct and indirect installed gross geothermal power production will increase to 26 MW immediately and up to 91 MW after HS Orka's planned expansion and Magma's planned expansions at its existing Soda Lake operation in Nevada. Magma commenced trading on July 7 of this year after completing an IOP of $1.50 per share, raising $10.4 million. In late July it was trading $1.85. Another Vancouver company that has entered the renewable energy business is Sierra Geothermal Power Corp (SRA-TSX-V) with properties in Nevada and California. The company's projects have a combined total estimated capacity of 500 MW. In July, Sierra received an environmental assessment decision with a finding of no significant impact from the US Bureau of Land Management for its Alum geothermal power project in Nevada. The BLM also has approved drill permits for deep-temperature gradient holes and production assessment for Alum. The stock trades around 25 cents.