The document discusses the gloomy economic outlook in 2008, highlighting California's unemployment rate reaching 8.2%, the highest in 14 years. It reflects on past economic crises and suggests that recovery may take 3-5 quarters, emphasizing that technology sectors may fare better during recessions. The overall message underscores the importance of investing based on fundamentals and adopting recession-proof business strategies.

2. « This is not the end of the World. The only thing that will bring on the end of the World will be the end of the World. » A leading mental coach 2009 GLOBAL ECONOMIC OUTLOOK

3. THE GLOOM & DOOM… California unemployment jumps to 8.2%, third-highest in the U.S. The state's unemployment rate is the highest in 14 years; 10:58 AM PST, November 21, 2008

4. JUNK DEBT HAVEN’T WE SEEN THIS DOOM BEFORE ??? Oct 13, 2008 Nov 19, 1973 OIL Nov 2, 1987 JUNK BONDS Sept 22, 2000 JUNK EQUITY

5. A CRISIS FUELED BY A REAL ESTATE BUBBLE

6. REAL ESTATE DEBT IS STILL BACKED BY A HEAVILY INDEBTED CONSUMER (WHO WILL NOT CONSUME AS BEFORE) 1929 depression – 2.6x 2008 recession – 3x 3X IN 20 YEARS

7. THE REALISTIC CURVE Dow at 8500

8. AND U.S. GDP IS ON A GOOD PATH TO POSITIVE RECOVERY IN 2H09, EPS IN 1H10, CONSUMER IN 2H10…EUROPE A LAGGARD

9. BUT THIS RECOVERY WILL BE LONG 3-5 quarters…maybe longer

10. THE GOOD NEWS FOR TECHNOLOGY

11. TECH SPENDING LESS VOLATILE THAN GENERAL ECONOMY

12. TECH STOCKS RECOVER MUCH FASTER THAN THE GENERAL ECONOMY

13. Certain data supplied by Sequoia, OECD Economic Office, Bloomberg Finance. The rest is our opinion, and does not represent advice or recommandations www.finatech.com Our rules: Invest on Fundamentals : Recession-proof business model Low overhead Tight cost control Defensible margins