A ROUGH TIME FOR STOCKS

---

  It's been a rough time for the stock markets. The S&P/TSX Composite Index is off about 1,000 points from its mid-summer high, or just over 7%. In New York, the Dow is down about 900 points from the all-time record it touched in July, or about 6.5%.

However, we need to keep things in perspective. Despite the recent correction (which may not yet be over), both the Dow and the TSX are still in positive territory year-to-date, with gains of 5.2% and 5.8% respectively. The big question in investors' mind is whether they can hold on or add to those profits between now and year-end.

At the start of this year, I predicted in our Mutual Funds Update newsletter that the high-flying Canadian stock market looked vulnerable because of its heavy weighting towards resource and financial stocks. At the time I wrote: "The TSX may end the year on the plus side…but don't count on more than a single-digit advance."

Now that we've reached September, I see no reason to change that view. The next few months are likely to see more volatility and while we may eke out some small gains, I don't expect anything dramatic.

Meanwhile, if you are overexposed to stocks and/or equity funds, you may want to lighten up a little. Holding cash reserves in times like this is never a bad idea. - G.P.

DO YOU KNOW WHAT YOUR MONEY IS DOING?

---

  It has been well over a decade since anyone questioned the safety of money market funds, but that's what is happening right now. The subprime mortgage crisis has revealed that some funds have invested in questionable securities and in some cases fund sponsors have stepped in with massive bail-outs.

If you have any cash in money market funds, you should take a close look at the situation and ask yourself whether you want to be in those funds at all - especially when there are good alternatives available that are protected by deposit insurance, which money funds are not. For the full story, read my article at http://www.buildingwealth.ca/News/Featuredetails.cfm?NewsletterID=2887

NEW BONUS REPORT - LOW-RISK STOCKS

---

  We're offering a new free report to everyone who buys or renews one of our newsletters or our On-Line Buyer's Guide to Mutual Funds.

It is titled Five Low-Risk Stocks to Own Now, as selected by the editors of the Internet Wealth Builder and The Income Investor. All five companies are leaders in their fields, have an excellent growth record, pay good dividends with frequent increases, and, most important, carry minimal risk if markets decline.

You'll learn all the details you need about each company, including its business, history, dividend record, trading symbol, and more.

This valuable report is free with any order. Don't miss it. To check out our fine products, visit www.buildingwealth.ca or call our toll-free Customer Service line at 1-888-287-8229.

FALL MUTUAL FUND SPECIAL

---

  One way to obtain our great new report is to take advantage of our Fall Special. It's a Mutual Fund Investors' Package that includes a three-month subscription to our highly successful Mutual Funds Update newsletter plus three months of 24/7 access to our popular On-line Buyer's Guide to Mutual Funds, which contains reviews and ratings for 1,250 funds from more than 100 companies. Don't buy another fund until you get this essential information. Only $29.95 plus tax. You'll find all the details at http://www.gordonpape.com/bookstore/productdetail.cfm?product_id=608

INCOME TRUSTS WON'T GO AWAY

---

  Most people seem ready to concede that the battle over income trusts is over. But not the Liberal Party of Canada! They've promised that if they are returned to power, they'll cut the trust tax and reopen the sector to new conversions. If you have any interest in the on-going trust saga, you'll want to read this story. http://www.buildingwealth.ca/News/Featuredetails.cfm?NewsletterID=2903

BEWARE OF HEDGE FUNDS

---

  Some people seem to think that the secret to getting rich is to invest in hedge funds. Sometimes it is - but just as often, it's a way to lose a lot of money. Find out the real truth in this article by Tom Slee, a contributing editor to the Internet Wealth Builder newsletter. http://www.buildingwealth.ca/News/Featuredetails.cfm?NewsletterID=2902

GREAT BOOKS, LOW PRICES

---

  We've added three outstanding titles to our Best Books page, including one of the greatest investment books of all time: Benjamin Graham's The Intelligent Investor, which is available for only $19.77 plus tax.

Although it was written almost 50 years ago, Graham's down-to-earth advice on choosing stocks based on intrinsic value remains as valid today as ever. Everyone who is interested in making money in the stock market should have this one on the shelf for ready reference.

Another newcomer to our Best Books page is an old favourite, One Up on Wall Street by Peter Lynch. He spent many years as manager of the high-performance Fidelity Magellan Fund, making investors very rich in the process. What is especially intriguing about this book is the author's description of how he selected stocks - including one winner that was picked based on his wife's trip to the local mall. It's a fun and instructive read, for only $14.59.

Finally, anyone interested in exchange-traded funds (ETFs) will want to read Howard Atkinson's The New Investment Frontier III ($16.02). This book was recommended by an Internet Wealth Builder reader who described it as a "well-researched and well-written" introduction to the world of ETFs. It focuses on the Canadian market but also includes valuable information on U.S. and foreign ETFs.

Our Best Books page is operated in conjunction with Amazon.ca, which means you get great value for your money. To visit it, go to http://astore.amazon.ca/buildicaquizm-20

BOND MARKET MADNESS

---

  Bonds are normally a sedate type of investment, but not these days. The subprime mortgage crisis has turned the bond market upside-down, creating both opportunities and dangers in the process. If you invest in bonds or bond funds, you'll want to read this article by fixed-income expert Tom Slee. http://www.buildingwealth.ca/News/Featuredetails.cfm?NewsletterID=2894

BUY-SELL REPORTS

---

  A reminder that, in co-operation with MPL Communications, we're offering a free service called Daily Buy-Sell Adviser. These are daily digests of articles from some of the world's top investment newsletters which are sent directly to you by e-mail. The service is free - the publishers allow us to do this in hopes people will subscribe to their letters.

You may choose to do so, but that decision is completely up to you. You will always receive the investment advice of Daily Buy-Sell Adviser without cost or obligation. So give it a try- it costs nothing. Simply click on the link below to sign up for this free premium service right now.

http://www.dailybuyselladviser.com/register/gp_index.html

TORONTO SEMINAR

---

  I will be giving a seminar titled "Defusing the Retirement Time Bomb" at the Beeton Auditorium of the Toronto Reference Library at 6.30 p.m. on Wednesday, Sept. 26. The Library is located at 789 Yonge St., near the corner of Yonge and Bloor, half a block north of the subway station. Parking is available in the nearby Hudson's Bay Centre.

In the presentation, I will deal with several hot-button issues relating to retirement planning including pension plans, government programs, investment strategies, and tax-saving tips.

Capacity is limited to a maximum of 120 people and the Library will not accept advance bookings, so attendance is on a first-come, first-served basis. Anyone interested is advised to arrive early to avoid disappointment. Autographed copies of my best-selling book "The Retirement Time Bomb" will be available for purchase.

That's all for this month. See you again in October.