Jay O'Keefe's Portfolio as of January 31, 2008

Last updated January 31, 2008

SYMBOL	LAST	%	NAME

			STOCKS
BHP	67.57	3.4	BHP Billiton
CHFHF	0.65	0.9	China Foods Ltd
ECA	66.06	2.4	EnCana Corp.
FSDAX	82.44	1.9	Fidelity Sel Defense
NEM	54.25	0.6	NEM Jan 09 Calls
PTR	142.28	1.0	Petrochina
SJT	36.79	3.6	San Juan Royal Tr
SLW	15.39	3.6	Silver Wheaton
SNP	107.63	1.0	China Petr & Chem
SSRI	34.79	5.6	Silver Standard Res.
SU	93.94	3.9	Suncor Corp.
TGLDX	51.99	1.1	Tocqueville Gold Fd
		3.4	Leap Puts
		32.4	TOTAL STOCKS

			PHYSICALS
	16.90	22.4	Junk Silver Coins
	18.40	2.0	Silver Eagles
	925.0	7.5	Kruggerands
UNG	39.28	2.9	Nat Gas ETF
SBH9	13.84	4.3	6 Mar 09 SUGAR
CTH8	67.79	1.6	1 Mar 08 COTTON
CTN8	71.51	1.7	1 JUL 08 COTTON
		42.2	TOTAL PHYSICALS

			CASH
		15.5	US$ Cash
FXF	92.65	2.1	SW Franc Tr ETF
FXY	93.91	3.9	Yen Tr ETF
		21.5	TOTAL CASH

		3.9	TOTAL MISC

		100.0	TOTAL PF

			BY CATEGORY
		1.6	Gold shares
		9.2	Silver shares
		9.9	Energy shares
		3.4	Misc Commod Shs
		2.0	Chinese Energy Shs
		0.9	Chinese Ag Shs
		1.9	Defense Shares
		7.5	Gold physical
		24.3	Silver physical
		10.4	Other PHY Commod
		15.4	Cash-$US
		3.9	Cash-Yen
		2.1	Cash-SW Franc
		3.4	Leap Puts
		3.9	Misc. Assets
		100.0	TOTAL PF

		32.4	TOTAL STOCKS
		42.2	TOTAL PHYSICALS
		21.5	TOTAL CASH
		3.9	TOTAL MISC.
		100.0	TOTAL PF

I made one sale since Letter 14 published 1/19/08. I sold my Permanent Portfolio Fund. I wanted to make some new investments without reducing my cash at this time, and since it was only about 8% of my portfolio, I decided to sell it. NOTE: I still recommend keeping that part of your portfolio which you don't want to subject to high risk, in the Permanent Portfolio Fund as explained in Lesson 2.

CHINA: I have been studying Jim Rogers' comments on China (including his new book, A Bull in China). I re-read interviews dating back to 2005, and one as recent as January 3, 2008. In the summer of 2006, he disclosed that he was invested in Chinese stocks. At that time the Chinese market was up more than double in two years. He said his intention was to keep his Chinese stocks for many years (letting his daughter inherit them), but if they doubled again rapidly from that point, he would probably be forced to sell. They did double again, but he has not yet sold. Since that time the Chinese government raised interest rates and reserve requirements 8 or 9 times hoping to "let the air out of the bubble." It worked.

The Chinese market has corrected down about half. In his interview January 3, Rogers disclosed that he had no intention of selling his Chinese stocks. Furthermore, he is currently moving a major part of his cash into the Chinese currency (called the Renminbi or Yuan). I printed out charts on several major Chinese companies which trade on the New York Stock Exchange. Attached is the chart on one of them, Petrochina (PTR), the major oil company in China. Look at the chart. Do you see what I see? That, along with Rogers' statements and actions (not my wisdom or knowledge) are all I need to know to be comfortable with an investment in China.

I increased my China Foods Ltd (CHFHF) to a near 1% position, and bought a 1% position in PTR and 1% in SNP (China Petroleum and Chemical). I would be comfortable up to 5% or 6% of the portfolio in Chinese stocks which trade on the NYSE. I like this investment because it is a double play. I own major growth companies in China, and I also own the Chinese currency. Right now it is pegged against the dollar. Rogers says it is inevitable that it will one day float freely, as all the major currencies do, at which time it could easily double or triple from today's level. If that happens, my Chinese stocks would also double or triple because they are denominated in the Chinese currency. Obviously, the timing is unknown.

There are risks in all investments, especially stocks, so I wouldn't want more than 5% or 6% in China. But what about the risk in the US$! You're lucky if you can get 4% or 5% interest on your cash. After you pay the tax on it, you'd be lucky to have left a third or fourth of the purchasing power you lost over the year.

PERFORMANCE: I am willing to disclose my performance on a year-to-date basis. And you can follow the prices of each investment every time I publish the portfolio. In January my portfolio was up 6.6%. That's amazing, and totally unexpected, especially after a 20% up year in 2007. The main reason was that gold was up 12% in January, and silver was up 14%, and together they are almost a third of my total portfolio. Yes, I'll let you know when I have a down month...and I will have.

CLOSING THOUGHTS: Regarding my China investment, I remind myself of the great statement by Peter Lynch, "When you make a new investment, you are making it for what's going to happen 2 or 3 years from now, not 2 or 3 months from now.

I hope many of you are making the effort to keep an allocation of your portfolio up to date (I like the format above). Once you get it set up, it won't be that difficult. And I also hope you have learned how to print out charts and draw in the trend lines (see page 4 of Letter 12). It's not difficult. With these two tools, and the letters, you should be able to do well assuming the Lord continues to bless. No guarantees, of course.

Thanks for your prayers. God bless................................Jay