The document provides an overview of recent US economic data and projections. It discusses improving indicators for GDP growth, unemployment claims, consumer spending and inflation expectations. Housing starts are gradually recovering but vehicle sales have far to go. The federal budget deficit was $1.3 trillion in 2010 and is projected to be $1.5 trillion in 2011, with the debt-to-GDP ratio expected to continue rising according to baseline forecasts.

1. Your Logo & Colors Economy – Markets – Investment Strategy February 2011

2. Important Information The views and opinions expressed are those of the speaker and are subject to change based on factors such as market and economic conditions. These views and opinions are not an offer to buy a particular security and should not be relied upon as investment advice. Past performance cannot guarantee comparable future results. Performance quoted is past performance and cannot guarantee comparable future results; current performance may be higher or lower. Results shown assume the reinvestment of dividends. An investment cannot be made directly in an index. Investments with higher return potential carry greater risk for loss. Investing in small companies involves greater risks not associated with investing in more established companies, such as business risk, significant stock price fluctuations and illiquidity. Foreign securities have additional risks, including exchange rate changes, political and economic upheaval, the relative lack of information about these companies, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards. Investing in emerging markets involves greater risk than investing in more established markets such as risks relating to the relatively smaller size and lesser liquidity of these markets, high inflation rates, adverse political developments and lack of timely information. Fluctuations in the price of gold and precious metals often dramatically affect the profitability of the companies in the gold and precious metals sector. Changes in political or economic climate for the two largest gold producers, South Africa and the former Soviet Union, may have a direct effect on the price of gold worldwide. Asset allocation/diversification does not guarantee a profit or eliminate the risk of loss. The S&P 500® Index is an unmanaged index considered representative of the U.S. stock market. The MSCI EAFE Index is an unmanaged index considered representative of stocks of Europe, Australasia and the Far East. The Vanguard 500 Index is an unmanaged index considered representative of the companies in the S&P 500 Index. The Vanguard Balanced Index is representative of the standard 60% equity, 40% fixed income allocation. The S&P/Case-Shiller U.S. National Home Price Index is an unmanaged index considered representative of single-family home prices for the nine U.S. Census divisions. The S&P GSCI Total Return Index is world-production weighted; the quantity of each commodity in the index is determined by the average quantity of production in the last five years of available data. The Barclays Capital Long-Term Treasury Bond Total Return Index is an unmanaged index considered representative of long-term treasury bonds. The Dow Jones Total Stock Market Index is an unmanaged index that measures all U.S. equity securities that have readily available prices. Government securities, such as U.S. Treasury bills, notes and bonds offer a high degree of safety and they guarantee the timely payment of principal and interest if held to maturity. U.S. Treasury bills are short-term securities with maturities of one year or less. Long-term government bonds used in this illustration have a maturity of approximately 20 years. The Consumer Price Index (CPI) is a measure of change in consumer prices, as determined by the U.S. Bureau of Labor Statistics. 2

4. GDP

5. Labor market

6. Housing & autos

7. Consumers

8. Demographics

9. Inflation

11. Bonds

12. U.S. dollar

13. Commodities

14. Gold

16. Modern Portfolio Theory

18. 5 Economic Data ISM Manufacturing Purchasing Managers Index “The continuing strong performance is highlighted as January is also the sixth consecutive month of month-over-month growth in the sector. New orders and production continue to be strong, and employment rose above 60 percent for the first time since May 2004.” Institute for Supply Management (ISM) Feb. 1, 2011 Source: Copyright 2011, Institute for Supply Management; data as of Jan. 31, 2011.

19. 6 Economic Data Gross Domestic Product (GDP) Growth Sources: Bureau of Economic Analysis, data through Dec. 31, 2010; Wall Street Journal survey taken Feb. 4-11, 2011.

20. 7 Economic Data GDP = C + I + G + Net Exports Contributions to Percent Change in Quarterly GDP Source: Bureau of Economic Analysis, data through Dec. 31, 2010

21. 8 Economic Data Gross Domestic Product Growth Fed’s latest central tendency forecast Accelerating rate of recovery through 2013 +2.5% to +2.8% longer run Source: Minutes of the Federal Open Market Committee meeting, Jan. 25-26, 2011.

22. 9 Economic Data World GDP Growth Forecasts Healthy global recovery expected Source: World Bank, Global Economic Prospects, published Jan. 12, 2011

23. 10 Economic Data Improvement in jobs picture Sources: National Bureau of Economic Research, Bureau of Labor Statistics; data as of Jan. 31, 2011.

24. 11 Economic Data Weekly unemployment claims Weekly unemployment claims have tumbled following summer uptick. Source: U.S. Department of Labor, data through the week of Jan. 29, 2011.

25. 12 Economic Data Unemployment is a lagging indicator Sources: National Bureau of Economic Research, Bureau of Labor Statistics; data as of Jan. 31, 2011.

26. 13 Economic Data Where will the jobs come from? Source: Bureau of Labor Statistics, data as of Dec. 31, 2010

27. 14 Economic Data Where will the “good jobs” come from? All Civilian Workers Private Industry Source: Bureau of Labor Statistics, data as of September 2010.

28. 15 Economic Data Housing starts gradually recovering Housing Starts (estimated) Housing Starts (actual) Sources: U.S. Census Bureau, data through Jan. 31, 2010; Mortgage Bankers Association’s housing starts forecast dated Jan. 14, 2011

29. 16 Economic Data Housing starts - the big picture Source: U.S. Census Bureau. Actual population data through 2008; projections 2009-2020. Actual annual housing starts through 2010.

30. 17 Economic Data Housing affordability Source: National Association of Realtors, data through November 2010 1 The affordability index measures whether a typical family could qualify for a mortgage loan on a typical home. A typical home is defined as the national median-priced, existing single-family home as calculated by NAR. The typical family is defined as one earning the median family income as reported by the U.S. Bureau of the Census. The prevailing mortgage interest rate is the effective rate on loans closed on existing homes from the Federal Housing Finance Board. A value of 100 means that a family with the median income has exactly enough income to qualify for a mortgage on a median-priced home. An index above 100 signifies that family earning the median income has more than enough income to qualify for a mortgage loan on a median-priced home, assuming a 20% down payment.

31. 18 Economic Data Vehicle sales … a long way to recover The recession took vehicle sales far below the run-rate of recent years. It looks like a recovery is underway ... and has a long way to go. Source: Bureau of Economic Analysis, data as of Nov. 30, 2010

32. 19 Economic Data Construction and vehicles combined share of GDP The recession cut construction plus vehicles combined share of GDP by about three percentage points, from 12% to 9%. Vehicles Structures Source: Bureau of Economic Analysis, data as of Sept. 30, 2010.

33. 20 Economic Data Consumer spending “I think the economy’s turning around. That guy looked as if he were about to give me something.”

34. 21 Economic Data Consumer income, spending and saving are up December savings rate = 5.3% Source: Bureau of Economic Analysis, data through Dec. 31, 2010

35. 22 Economic Data Consumer income by source Rising hours worked, average wages and meager, but positive, payroll gains are driving employee compensation. Source: Bureau of Economic Analysis, data through Dec. 31, 2010

36. 23 Economic Data Consumer liquidity is at a record high Aggregate household spendable cash equals 75% of annual disposable personal income … or, approximately nine months’ income. M2 = cash, checking, savings and retail money market funds Sources: Federal Reserve, Bureau of Economics Analysis; data through Sept. 30, 2010

37. 24 Economic Data Consumer Spending Versus Household Net Worth How significant is the negative wealth effect on consumer spending? “Declining household wealth has a relatively small implied negative impact on aggregate consumption expenditures.” Federal Reserve Bank of Boston Paper No. 09-9, Nov. 13, 2009 Sources: Federal Reserve, Bureau of Economic Analysis; data through Sept. 30, 2010

38. 25 Economic Data Household Debt By this often-cited measure consumers are near-record leveraged Source: Federal Reserve, data as of Sept 30, 2010; released Dec. 8, 2010

39. 26 Economic Data Consumers’ Financial Obligations Ratio Major improvement in consumers’ ability to carry their debt burden The financial obligations ratio consists of estimated required payments on outstanding mortgage and consumer debt plus automobile lease payments, rental payments on tenant-occupied property, homeowners’ insurance and property tax payments divided by disposable personal income. Source: Federal Reserve, data as of Sept. 30, 2010; released Dec. 17, 2010

40. 27 Economic Data Personal income and spending by quintile Most consumers don’t appear to be tapped out Because income and spending are skewed to the upper brackets, the recovery in spending growth rides significantly on spending behavior in the higher brackets. Sources: Bureau of Labor Statistics. Consumer Expenditure Survey, 2008, table 45 Note: In the NBER’s Working Paper 15408 published October 2009, the top income decile (10%) accounted for 50% of 2007 total income, using a definition of income somewhat broader than the BLS’s.

41. 28 Economic Data Consumers’ Financial Obligations Ratio Major improvement in consumers’ ability to carry their debt burden CAGR1 3/09-1/11 = 7.1% 1 CAGR: Compound annual growth rate Source: U.S. Census Bureau; data as of Jan. 31, 2011

42. 29 Economic Data GDP Growth Potential = ∆ Productivity + ∆ Labor ForceLabor force to grow 0.8% per year through 2016 U.S. Live Births 1909–2008 Birth Wave 2 (echo boomers) (1977–2008) 125 million Birth Wave 1 (1946–1976) 117 million Sources: 1909 to 2004: U.S. Census Bureau, 2007 Statistical Abstract; 2005 to 2007: U.S. Department of Health and Human Services, National Center for Health Statistics; 2008: Bureau of Labor Statistics

43. 30 Economic Data Labor Force Growth — Forecasts Source: United Nations, World Population Prospects: The 2008 Revision, constant-fertility scenario

44. Economic Data Benign Inflation Expected to Continue Federal Reserve’s personal consumption expenditures (PCE) inflation forecast1 1 From the minutes of the Federal Open Market Committee meeting, Nov. 2-3, 2010; released Nov. 23, 2010 Source: Bureau of Labor Statistics; data as of Jan. 31, 2011. 31

45. 32 Economic Data What about food and energy inflation? Food and energy constitute 13% of total personal consumption expenditures (PCE) ... substantially less than housing and health care. Source: Bureau of Economic Analysis, data through Dec. 31, 2010

46. Economic Data What about food and energy inflation? 33 1 Personal consumption expenditures Source: Bureau of Economic Analysis, data through Dec. 31, 2010

47. Economic Data Money Supply versus Monetary Base The Federal Reserve has engineered an explosion in the Monetary Base — reserves that commercial banks keep on deposit at the Fed — in an effort to restore confidence in banks and stimulate the economy. M2 — which is a function of both supply and demand for funds — has not surged. Source: Federal Reserve, data as of Dec. 31, 2010 34

48. 35 Economic Data Inflation versus capacity use “Currently, the unemployment rate is elevated, and measures of underlying inflation are somewhat low, relative to levels that the Committee judges to be consistent, over the longer run, with its dual mandate. Although the Committee anticipates a gradual return to higher levels of resource utilization in a context of price stability, progress toward its objectives has been disappointingly slow.”1 1 Source: Federal Open Market Committee’s statement released Jan. 26, 2011 Sources: Bureau of Labor Statistics, Federal Reserve; data as of Dec. 31, 2010

49. 36 Economic Data Inflation versus money supply growth The monetarist explanation of inflation operates through the Quantity Theory of Money, which states MV = PT. M is money supply, V is velocity of circulation, P is price level and T is transactions or output. Because monetarists assume that V and T are determined, in the long run, by real variables such as the productive capacity of the economy, there is a direct relationship between the growth of the money supply and inflation.1 1 Source: Wikipedia Sources: Bureau of Labor Statistics, Federal Reserve; data as of Dec. 31, 2010

50. 37 Economic Data “TIPS Spread” implied inflation expectations The difference between the Treasury Inflation (TIPS) yield and the U.S. Treasury bond yield of the same maturity provides a market–based theoretical measure of investors’ expected rate of annual inflation over the period to maturity. Investors are not anticipating a surge in inflation. Source: Copyright 2011© B0596A. Ned Davis Research, Inc. All rights reserved. Data as of Jan. 27, 2011. The data and analysis shown are provided “as is” and without warranty of any kind, either expressed or implied. Ned Davis Research, Inc. (NDR), any NDR affiliates or employees, or any third-party data provider, shall not have any liability for any loss sustained by anyone who has relied on this information contained.

51. 38 Economic Data Federal budget deficit “You’re in luck, in a way. Now is the time to be sick — while Medicare still has some money.”

52. 39 Economic Data Actual and projected federal budget deficit Baseline scenario Projected (dotted line) 2010 Deficit = $1.3 trillion 2011 Deficit (E) = $1.5 trillion Sources: Actual: Bureau of Economic Analysis through Dec. 31, 2010; Projected: Congressional Budget Office (CBO), Budget and Economic Outlook: An Update, January 2011, Baseline Projection

53. 40 Economic Data Actual and projected federal debt as a percent of GDPBaseline scenario Projected (dotted line) Sources: U.S. Office of Management and Budget data through Dec. 31, 2010; Congressional Budget Office’s (CBO) Budget and Economic Outlook, January 2011, Baseline Projection

54. 41 Economic Data Projected federal debt as a percent of GDP Note the CBO’s important qualifying explanation “The projected deficits over the latter part of the coming decade are much smaller relative to GDP than is the current deficit, mostly because, under (the baseline) assumptions and with a continuing economic expansion, revenues as a share of GDP are projected to rise steadily — from about 15% of GDP in 2011 to 21% by 2021. As a result, the baseline projections understate the budget deficits that would arise if many policies currently in place were extended, rather than allowed to expire as scheduled under current law. For example, if most of the provisions in the 2010 tax act that were originally enacted in 2001, 2003 and 2009 or that modified estate and gift taxation were extended (rather than allowed to expire on Dec. 31, 2012), and the alternative minimum tax was indexed for inflation, annual revenues would average about 18% of GDP through 2021 (which is equal to their 40-year average), rather than the 19.9% shown in CBO’s baseline projections. If Medicare’s payment rates for physicians’ services were held constant as well, then deficits from 2012 through 2021 would average about 6% of GDP, compared with 3.6% in the baseline. By 2021, the budget deficit would be about double the baseline projection, and with cumulative deficits totaling nearly $12 trillion over the 2012–2021 period, debt held by the public would reach 97% of GDP, the highest level since 1946.” (underline added) Source: Congressional Budget Office’s (CBO) Budget and Economic Outlook, January 2011; baseline projection

55. 42 Economic Data Congressional Budget Office long-term spending projections Actual Projected Medicare and Medicaid Social Security Other Federal Noninterest Spending Sources: Congressional Budget Office (CBO), The Long-Term Budget Outlook; June 2010. Alternative fiscal scenario.

56. 43 Market Data “This stock market situation — what are the military options?”

57. 44 Market Data S&P 500 — earnings drive stock prices, estimates rising 20121 20111 1 Estimated 2011 and 2012 bottom-up S&P 500 earnings per share (left scale): for 2011, $96.33; for 2012, $109.98; as of Jan. 14, 2011. Sources: Thomson Baseline; data through Jan 27, 2011. Reuters and Thomson Financial survey of consensus estimates.

58. 45 Market Data S&P 500 — 10-year total returns Source: Copyright© Thechartstore.com, with permission; monthly data through Dec. 31, 2010

59. 46 Market Data S&P 500 P/E ratio versus inflation Sources: Standard & Poor’s Corporation, BLS; data through Nov. 30, 2010

60. 47 Market Data Still-high cash stash versus stocks Money market assets compared to total stock market value1 1 The NDR Total Market Value proxies the market value of all U.S.-domiciled companies traded on U.S. exchanges. Source: Copyright 2010© S423. Ned Davis Research, Inc. All rights reserved. Data as of Dec. 31, 2010. The data and analysis shown are provided “as is” and without warranty of any kind, either expressed or implied. Ned Davis Research, Inc. (NDR), any NDR affiliates or employees, or any third-party data provider, shall not have any liability for any loss sustained by anyone who has relied on this information contained.

61. 48 Market Data 10-Year U.S. Treasury bond yield forecasts Economists1have been raising their bond yield forecasts Forecast for year-end 2011 1 Average forecasts from the Wall Street Journal’s survey of 56 economists taken Jan. 7-11, 2011

62. 49 Market Data 10-Year U.S. Treasury bond yieldViewed from the long-term perspective, bond yields could remain low Source: Copyright© Thechartstore.com, with permission; monthly data through Dec. 31, 2010

63. 50 Market Data Stock market versus U.S. Treasury bond yieldsCan stocks rally as bond yields rise? Rising bond yields have accompanied bull markets. Sources: Standard & Poor’s, Baseline; data as of Dec. 14, 2010

64. Market Data Municipal bonds A tidal wave of selling Far more muni selling recently than the surge associated with the 2008 auction-rate fiasco. Source: Copyright 2011© B303. Ned Davis Research, Inc. All rights reserved. Data as of Jan. 21, 2011. The data and analysis shown are provided “as is” and without warranty of any kind, either expressed or implied. Ned Davis Research, Inc. (NDR), any NDR affiliates or employees, or any third-party data provider, shall not have any liability for any loss sustained by anyone who has relied on this information contained. 51

65. 52 Market Data Municipal bonds Yields have surged with panic selling 20-year muni bond yield is approaching the peak associated with the 2008 auction-rate fiasco. Source: Copyright 2011© B470. Ned Davis Research, Inc. All rights reserved. Data as of Jan. 21, 2011. The data and analysis shown are provided “as is” and without warranty of any kind, either expressed or implied. Ned Davis Research, Inc. (NDR), any NDR affiliates or employees, or any third-party data provider, shall not have any liability for any loss sustained by anyone who has relied on this information contained.

66. 53 Market Data Municipal bonds Moody’s description of the “general obligation” pledge Source: Copyright 2002 © Moody’s Investors Services, Inc. B470. Special Comment, November 2002, page 4.

67. Market Data Agency, mortgage-backed and corporate bond yieldsUp from recent lows Investment-grade corporate yields 4%. High yield bonds yield 7%. Emerging markets yield 6%. Commercial mortgage backed securities (CMBS) yield 4%. Source: Copyright 2011© B158A. Ned Davis Research, Inc. All rights reserved. Data as of Jan. 27, 2011. The data and analysis shown are provided “as is” and without warranty of any kind, either expressed or implied. Ned Davis Research, Inc. (NDR), any NDR affiliates or employees, or any third-party data provider, shall not have any liability for any loss sustained by anyone who has relied on this information contained. 54

68. 55 Market Data U.S. Dollar Broad Dollar Index1 Index 1 See Broad Dollar Index definition, next page Source: Copyright© Thechartstore.com, with permission, monthly data through Dec. 31, 2010

69. 56 Market Data U.S. Dollar Source: Copyright© Thechartstore.com, with permission; data as of Dec. 31, 2010

70. 57 Market Data Commodities, stocks and inflation Commodities have historically provided long-term returns comparable to stocks. Commodities have historically outperformed during periods of rising inflation. Source: Copyright© Ned Davis Research, Inc. B0705B. Data as of Dec. 31, 2010. The data and analysis shown are provided “as is” and without warranty of any kind, either expressed or implied. Ned Davis Research, Inc. (NDR), any NDR affiliates or employees, or any third-party data provider, shall not have any liability for any loss sustained by anyone who has relied on this information contained.

71. 58 Market Data Gold Source: Baseline; data as of Dec. 31, 2010

72. 59 Market Data Crude Oil Rising post-recession demand forecast Actual Estimated Source: U.S. Department of Energy, Energy Information Agency, International Energy Outlook, May 2010, reference case 1 BRIC = Brazil, Russia, India and China

73. 60 Market Data Crude Oil Historically inversely correlated to the $USD; reflecting rising global demand outlook Source: Baseline; data as of Dec. 31, 2010

74. 61 Conclusions Economic data: Most economists believe that global economic recovery will gain momentum, including in the U.S. “New normal” isn’t playing out as advertised. The unemployment rate might trail economic recovery. Consumers’ savings and liquidity have risen substantially. The “negative wealth effect” may be overestimated. Significant skew in income, spending is relevant to economic recovery. The U.S. economy is positioned to continue its +2½% to +3% long-term trend rate of growth. Inflation is subdued and has the potential to remain so for at least a few years. The CBO’s “baseline projection” projects massive budget deficits lasting at least two years. Market data: Still significant cash on the sidelines. Stocks are attractively valued on estimated earnings. Municipal bonds may be presenting a buying opportunity. The U.S. dollar is holding up. Commodities have historically provided equity-like returns. Gold and crude oil both rising. “It’s just a correction.The fundamentals are still good.”

75. 62 Investment Strategy “Winning is crucial to my retirement plans.”

76. 63 Investment Strategy Wall Street’s Call for 2010 Barron’s 2010 Forecast1 Survey of 12 stock market strategists’ sector picks and pans for 2010 Good call Big mistake Good call Good call Big miss 1 Published Dec. 21, 2009 2 Media 3 These are S&P 500 sector returns for calendar 2010. Past performance is not a guarantee of future results. For Illustrative purposes only.

77. 64 Investment Strategy Wall Street’s Call for 2011 Barron’s 2011 Forecast1 Survey of 10 stock market strategists’ sector picks and pans for 2011 1 Published Dec. 20, 2010 2 Oil services 3 Railroads For Illustrative purposes only.

78. 65 Investment Strategy Modern Portfolio Theory “Your mother called to remind you to diversify.”

79. 66 Investment Strategy Modern Portfolio Theory = Asset Allocation Modern portfolio theory was introduced by Harry Markowitz with his paper “Portfolio Selection,” which appeared in the 1952 Journal of Finance. Thirty-eight years later, he shared a Nobel Prize with Merton Miller and William Sharpe for what has become a broad theory for portfolio selection. Modern Portfolio Theory Diversify Optimize Rebalance Asset allocation and diversification do not guarantee a profit or eliminate the risk of loss. Source: Riskglossary.com

80. 67 Investment Strategy Asset Allocation — An Example Let’s construct a global balanced portfolio using 12 asset classes … Commodities Real Estate Bonds Stocks This hypothetical portfolio is approximately 50% stocks, 33% bonds, 8% real estate and 8% commodities. For a detailed analysis of a similar approach to asset allocation, refer to 7Twelve – A Diversified Investment Portfolio With A Plan, ©2010, John Wiley & Sons, Inc. Author Craig L. Israelsen is an associate professor at Brigham Young University and a contributor to Financial Planning, Journal of Indexes, Bank Investment Consultant Magazine, Financial Advisor and other publications.

81. Investment Strategy Asset Allocation — An Example… and see how it would have performed from Dec. 31, 1999 – Dec. 31, 2010 CAGR3 = +8.4% 12-Index Global Balanced Portfolio1 CAGR3 = +3.4% 60/40 Portfolio2 CAGR3 = +0.4% S&P 500 Past performance is not a guarantee of future results. An investment cannot be made directly in an index. 1 This hypothetical portfolio is composed of the 12 indexes referred to on the previous page, rebalanced to 1/12th of the portfolio at the end of each year. 2 This hypothetical portfolio is composed of the S&P 500 and Barclays US Aggregate Bond indexes referred to on the previous page, rebalanced to 60%/40%, respectively, at the end of each year. 3 Compound annual growth rate. 68

82. 69 Investment Strategy FundQuest BNP Paribas Study1 73 Fund Categories Analyzed “Out of the 73 categories in our study, we recommend a bias to active management in 23 categories and a bias to passive management in 22 categories. Twenty-eight (28) categories were deemed neutral.” Bank Loan, Bear Market Commodities Broad Basket, Communications Conservative Allocation Consumer Discretionary, Consumer Staples Convertibles, Currency, Diversified Emerging Mkts Diversified Pacific/Asia, Emerging Markets Bond Equity Energy, Equity Precious Metals Europe Stock, Financial Foreign Large Blend, Foreign Large Growth Foreign Large Value, Foreign Small/Mid Growth Foreign Small/Mid Value, Global Real Estate Health, High Yield Bond, High Yield Muni Industrials, Inflation-Protected Bond Intermediate Govt’ Bond Intermediate-Term Bond, Japan Stock, Large Blend Large Growth, Large Value, Latin America Stock Long Government, Long-Short, Long-Term Bond Mid-Cap Blend, Mid-Cap Growth, Mid-Cap Value Miscellaneous Sector, Moderate Allocation Multisector Bond Muni National Interm, Muni National Long Muni National Short, Muni Single State Interm Muni Single State Long, Muni Single State Short Natural Resources, Pacific/Asia ex-Japan Stk, Real Estate Retirement Income, Short Government Bond Short-Term Bond, Small Blend, Small Growth Small Value Target Date 2000-2010 Target Date 2011-2015; 2016-2020; 2021-2025 Target Date 2026-2030; 2031-2035; 2036-2040 Target Date 2041-2045; Target Date 2050+ Technology, Ultrashort Bond, Utilities, World Allocation, World Bond, World Stock 1 ©FundQuest BNP Paribas Group study dated June 2010, Jane Li, author. “When Active Management Shines vs. Passive – Examining Real Alpha in 5 full market cycles over the past 30 years.”

83. 70 Investment Strategy Conclusions Wall Street strategists don’t, generally speaking, systematically add value. Global diversification with rebalancing provides support for modern portfolio theory (MPT). “I’m looking for a hedge against my hedge funds.”

84. 71 And Don’t Believe Everything You Hear A study by Media Research Center of a year’s worth of economic coverage on ABC, CBS and NBC found more than twice as many stories and briefs focused on negative aspects of the economy (62%) compared to good news (31%). Source: Media Research Center, “Bad News Bears,” October 2006. “We were wondering if now would be a good time to panic?”

85. 72 Important Information All material presented is compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. This is not to be construed as an offer to buy or sell any financial instruments and should not be relied upon as the sole factor in an investment making decision. As with all investments there are associated inherent risks. Please obtain and review all financial material carefully before investing. The opinions expressed are those of the author, are based on current market conditions and are subject to change without notice. These materials may contain statements that are not purely historical in nature but are “forward-looking statements.” These include, among other things, projections, forecasts, estimates of income, yield or return or future performance targets. These forward-looking statements are based upon certain assumptions, some of which are described herein. Actual events are difficult to predict and may substantially differ from those assumed. All forward-looking statements included herein are based on information available on the date hereof and Fritz Meyer assumes no duty to update any forward-looking statement. Accordingly, there can be no assurance that estimated returns or projections can be realized, that forward-looking statements will materialize or that actual returns or results will not be materially lower than those presented. Note: Not all products, materials or services available at all firms. Advisers, please contact your home office.