Global Vision Advisors offers modern wealth management services for today’s changing markets.

Cycles of Inflation

Au

tum

n

• Real estate soars• Interest rates soar

• Moderate debt builds• Stock make no progress

• Gold & commodities soarCapital good sector overbuilds

• Bond prices rise• Interest rates fall• Stock market booms• Inflation rate drops fast• Commodity prices drop• Stocks peak then crash• Debt rises to unsustainable

levels

• Currency crisis, interest rates spike as credit contracts

• Consumer confidence drops• Debt repudiation

(bankruptcies)• Unemployment high• Run from paper money to gold

• Employment & consumer confidence increases

• Inflation increases

• Stocks rise from low levels

• Early debt buildup

AUTUMNSUMMER

SPRING WINTER

RUNAWAYINFLATION DISINFLATION

DEFLATIONSTART OFINFLATION

Bullish for Stocks & Bonds

Bullish for Stocks & Bonds

Bearish for Stocks & Bonds

Bearish for Stocks & Bonds

Spri

ng

Aut

umn

Win

ter

Sum

mer

Spri

ng

Aut

umn

Win

ter

Sum

mer

Aut

umn

Win

ter

Sum

mer

Spri

ng

Sum

mer

Win

ter

Aut

umn

BEAR

Not a good time for the buy &

hold!

Average Bull Market = 18.5 Years Average Bear Market = 17 Years

P/E: 44.2P/CF: 1.45

Record:Price to BookInsider SellingDebt LevelsSpending, etc.

U.S. Debt Since 1929U.S. Debt Since 1929

0

10,000,000,000,000

20,000,000,000,000

30,000,000,000,000

40,000,000,000,000

50,000,000,000,000

60,000,000,000,000

1977 1982 1987 1992 1997 2002 2007

Federal Govt Trust FundsFederal GovtState and Local GovtFinancial SectorForeignCorporateHousehold OtherConsumer CreditHome Mortgage

Source: Federal Reserve Flow of Funds Report

Government

$14Trn

Financial

$17Trn

Corporate

$11Trn

Consumer

$14Trn

Total U.S. Debt, 2008Total U.S. Debt, 2008

Consumer Debt

Negative Equity by Mortgage SectorNegative Equity by Mortgage Sector

Source: Deutsche Bank August 5, 2009 Report

Estimated percent of borrowers with negative equity, by product

Q1 2009 Q1 2011 Projected

Conforming 16% 41%

Prime jumbo 29% 46%

Alt-A 49% 66%

Subprime 50% 69%

Option ARM 77% 89%

Total mortgage market 26% 48%

Demographics

Sp

end

ing

Sp

end

ing

46-50

$5,000

20 30 40 50 60 70 80

$10,000

$15,000

$20,000

$25,000

$30,000

AgeAge

$35,000

$40,000

Average Annual Family Spending by Age(5-year age groups)

Immigration Adjusted Birth IndexT

ho

usa

nd

sT

ho

usa

nd

s

Year

5,000

1910 1920 1930 1940 1950 1960 1970 1980 1990

4,500

4,000

3,500

3,000

2,500

2,200,000

2,700,000

3,200,000

3,700,000

4,200,000

4,700,000

5,200,000

1956 1966 1976 1986 1996 2006 2016 2026 2036 2046

1,000

3,000

5,000

7,000

9,000

11,000

13,000

15,000

17,000

Immigration-adjusted Births Lagged for Peak

Spending

Dow Adjusted for Inflation

The Spending WaveBirths Lagged for Peak in Family Spending

The Spending WaveBirths Lagged for Peak in Family Spending

Innovation Growth Boom Maturity Boom

Shake-Out

Spending Wave

Innovation/ Inflation

1968 1978 1988 1998 2008 2018 2028 2038

We Are Here

Innovation

Inflation Disinflation

DeflationStable Prices Inflation

Stable Prices

80-Year New Economy Cycle

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

1984 1987 1990 1993 1996 1999 2002 2005

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

Close

Net Worth (1,000s of Yen)

Japanese Stock Market vs. Japanese Net Worth1984 – 2005

Source: Japanese Family Income and Expenditure SurveySource: Japanese Family Income and Expenditure Survey

Why this is not the onset of a new secular bull market - Comparisons with August 1982 - From David Rosenburg:• P/E Multiples were 8x, not 26x.• Dividend yields were 6%, not sub-2%.• The stock market was trading at a discount to book, not a 2x premium.• Monetary policy was aimed at reducing money growth and inflation rates, notcreating both as is the case now.• Fiscal policy was aimed at reducing nondefense spending, not accelerating it.• Deficits were peaking and coming down, not surging to 10%+ relative to GDP.• Global trade barriers were being torn down; not erected.• Deregulation back then was in; today it is all about re-regulation and government ownership.• Union membership was on the way down; today it is back on the rise.• Credit, household balance sheets and participation rates were expanding, notcontracting.• Tax rates, income, capital gains and dividends, were declining then; rising now.

Tactical Investment Portfolio For

The Global Vision Advisors' Tactical Investment Portfolio is designed to capitalize on current trends, advances in risk management and targeted asset classes that align with protecting wealth and growing assets in volatile markets.

Advanced DiversificationDec-09