Winter Outlook Trends 2010

Summary Points:•US DOLLAR INDEX LOWER IN 2010: $.67

Target.•CRB INDEX ASCENDS TO 300 LEVEL

RANGE•MATERIALS LEADS S&P 500 NEXT 5

YEARS•COPPER TO LEAD MATERIALS - $3.75

RANGE 2010•OIL MID TO HIGH ‘80’s….POST 90 2011

•

ASIAN DEMAND DRIVES COMMODITIES: DOLLAR IMPACT POSITIVE AS $US DOLLAR WEAKENS

ASIAN DEMAND

ASIAN DEMAND DRIVES COMMODITIES: DOLLAR IMPACT POSITIVE AS $US DOLLAR WEAKENS

ASIAN DEMAND

Commodities continued…..

• NEXT LOW MARCH TIMEFRAME – SHALLOW

• PRIMARY UPTREND IN PLACE• LIMITED PRESSURE ON $US STABLE

ABOVE $.765• CRB TRADING ON 10 WEEK CYCLES• ASSET CLASSES MOVING TOGETHER IN

OIL, COPPER AND $CDN.

LIGHT CRUDE OIL CONTRACT

CRUDE OIL…..

• TECHNICAL OUTLOOK: POSITIVE OIL, COPPER, $CDN.

• OIL TRADING ON 12 WEEK OUTLOOK

• MARCH LOW

• PRIMARY OIL TREND IS UP

• TARGET RANGE 85-90

CANADIAN DOLLAR

• GOOD PRICE SUPPORT $.70 to $.74• SAME PATH AS COPPER, OIL

GOLD BUGS INDEX….

• CONSOLIDATION TREND – 1200 OZ ?

NATURAL GAS….

2008 US ECONOMY – GAS INVENTORY HIGH• GAS PLUNGES TO 2002 LEVELS

• INVENTORY ABOVE 5 YEAR LEVELS

• SEASONAL MOVEMENT SEPT. TO DEC.

AGRICULTURE….• CAN LAG CRB INDEX BY ONE YEAR.

• GOLD IS FIRST UP AND GRAINS ARE LAST.

• GOLD IS LINKED TO THE US DOLLAR VS. AGRICULTURE MORE ECONOMY DRIVEN.

• GLOBAL ECONOMY NEEDS MORE LIFT BEFORE A. PRICES LIFT.

INVESTOR ACTIONS?

• STAY FOCUSED ON 24 MONTH VIEW• ASIAN DEMAND TO GROW WORLD

ECONOMY• $US WEAKNESS FUELS COMMODITIES• CYCLE MAY LAST SEVERAL YEARS• NATURAL RESOURCES OUTPERFORM

STOCK SINCE 2001• NEXT BUSINESS CYCLE 2010-2014

ETF’S FOR 2010-2014 BUSINESS CYCLE

• FXE – EURO TRUST AS $US WEAK

• XMA MATERIALS

• CMW CLAYMORE GLOBAL MINES

• XEG ENERGY

• XGD GOLD PRODUCERS

• JJC – IPATH COPPER

• XRB REAL RETURN BONDS

• XSB SHORT TERM BONDS

• SEA GLOBAL SHIPPING

• EWZ – BRAZIL

• CBQ – CLAYMORE BRAZIL, RUSSIA, INDIA , CHINA

• IYR – US REAL ESTATE

ETF CLAYMORE GLOBAL MINES

• Symbol (Click for Intraday Price)

• CMW

• Exchange

• TSX

• CUSIP 183839109

• Fund Inception Date 6/12/07

• Income Distribution Canadian & Foreign Dividend Income

• Distribution Frequency Quarterly

• RSP Eligible

• Yes

• Management Fees 0.55 %

• Fiscal Year-End12/31

• Investment Adviser Claymore Investments, Inc.

CLAYMORE HOLDINGS……

• BHP BILLITON LTD - ADR15.91 %

• RIO TINTO PLC -SPONSORED ADR12.00 %

• BHP BILLITON PLC-ADR (1ADR=2ORD)9.47 %

• CIA VALE DO RIO DOCE ADR(COMMON)6.40 %

• ANGLO AMERICAN PLC UNSPON ADR5.09 %

• FREEPORT-MCMORAN COPPER & GOLD4.98 %

• BARRICK GOLD CORP COM (I/L)3.94 %

• ALCOA INC3.71 %

• GOLDCORP INC3.20 %

• TECK COMINCO LTD CL B2.42 %

• NEWMONT MINING CORP.2.33 %

• PEABODY ENERGY CORPORATION 2.25 %

• CONSOL ENERGY INC

• 2.00 %CAMECO CORP (I/L)1.58 %

• KINROSS GOLD CORP1.38 %

• YAMANA GOLD INC COM1.17 %

• AGNICO-EAGLE MINES LTD1.14 %

• FORDING CANADIAN COAL TRUST1.06 %

• ARCH COAL INC1.05 %

• GOLD FIELDS LIMITED SPONS ADR0.95 %

• ANGLOGOLD ASHANTI LTD ADR0.90 %

• ALUMINUM CORP OF CHINA - ADR0.78 %

•  •  

SILVER….UNDERVALUED…..

Historic ratio of 10:1 silver to gold•  Silver will return 6.5x MORE Potential Than Gold Current ratio is 65:1

MARKET DIRECTIONS…..

• MARKETS FALL IN SUCCESSION HISTORICALLY

• FINANCIALS DECLINE FIRST

• STOCK MARKETS THEN WEAKEN

• COMMODITIES FALL LAST AND HARDEST

GLOBAL MARKETS…KEY POINTS

• WORLD ECONOMY BOTTOMS LATE 2009

• 2010 GRADUAL ECONOMIC EXPANSION

• EMERGING NATIONS – EXPAND

• BRIC NATIONS OUTPERFORM

• GLOBAL MARKETS MORE TRANSPARENT

DOW JONES WORLD STOCK INDEX

• STIFF RESISTANCE AT 240-280• TRADING ON A 16 WEEK CYCLE

GDP VS. CPI

• MARCH IS 1ST ANNIVERSARY OF BULL MARKET PER TECHNICALS

• TIME IS 2-3 YEARS

• ASIA, RUSSIA, MEXICO, SOUTH AMERICA, AFRICA = DEVELOPING COUNTRIES AT 6.6% PER IMF STATS

• ADVANCE ECONOMIES US, CANADA, JAPAN, EU AVERAGE 2.4% GROWTH

• WORLD AVERAGE IS 4.5% 2010

• CPI DEVELOPING COUNTRIES AVERAGE 5% VS. 1% ADVANCED ECONOMIES

BRIC NATIONS SET PACE…..

• BRAZIL, RUSSIA, INDIA,CHINA

BRIC NATIONS OUTPERFORMING EU 350 INDEX & S&P500

Chinese GDP 10.7%India GDP 8.4%Brazil GDP 6.6%

S&P 500

• BOTTOM FORMING AT 980 LEVEL• MONEY IS EASIER TO LEND…..TIME

DATA SHOWS WORLD ECONOMY BOTTOMING

• 1980’s TOP COUNTRIES NOT TO DOMINATE IN 2010-2014 BUSINESS CYCLE

• TOP 7 PERFORMING INDICES & REGIONS• LATIN AMERICA• INDIA• PACIFIC – EX. JAPAN• SHANGHAI• BRAZIL• MALAYSIA• HONG KONG

TSX KEY POINTS…

• TWO YEAR RALLY – COMMODITIES & OIL• STABLE BANKS• CANADA OUTPERFORMS GLOBALLY• TARGET RANGE 12,000 – 12,500 2010

WHERE IS INVESTOR VALUE….

• REITS OFFER VALUE• UTILITIES AND PIPELINES INFRASTRUCTURE• PRIVATE EQUITY EYES INCOME TRUSTS• MATERIALS• INFLATION EXPOSURE• REAL RETURN BONDS• CORPORATE AND HIGHER YIELDING BONDS• GLOBAL BONDS

OPERATING CASH FLOW

• LEADING INDICATOR OF VALUE• PREVENTS PORTFOLIO SPECULATION

• CASH FLOW FROM OPERATIONS• CASH FLOW FROM FINANCING• CASH FLOW FROM INVESTMENTS• CASH FLOW OR EBITDA = SAME

LANGUAGE OF BAY AND WALL STREET• OCF IS NOT EBITDA

OPERATING CASH FLOW VALUE……

QUARTER OCF EPS

Q1(3/31/01) -$.62 +$.54

Q2(6/30/01) -$1.16 +$.51

ENRON’S OCF VS. EPS 2001

ENRON SHOWS POSITIVE EARNINGS BUT IS LOSING CASH………..

EBITDA…..WHAT IS THIS?

• EARNINGS BEFORE INTEREST TAXES DEPRECIATION ALLOWANCE

• ENABLES FINANCIAL STATEMENT MANIPULATION

• EARNINGS PER SHARE…..IS NOT CASH FLOW

• ITEMS SOLD BUT CASH NOT NECESSARILY COLLECTED

• WRITEOFFS MAY OCCUR AT ANY TIME

• EBITDA IS NOT OPERATING CASH FLOW !

ENRONS RESTATED CASH…..

QUARTER OCF EPS

Q1(3/31/01) -$.53 +0.46

Q2(6/30/01) -$.98 +$0.43

Q3(9/30/01) +$.77 -$.87

EXAMPLE OF OPERATING CASH…

CASH FLOW FROM OPERATIONS

NET EARNINGS 2,000,000

ADDITIONS TO CASH

DEPRECIATION 10,000

DECREASE IN ACCOUNTS RECEIVABLE 15,000

INCREASE IN ACCOUNTS PAYABLE 15,000

INCREASE IN TAXES PAYABLE 2000

SUBTRACTIONS FROM CASH

INCREASE IN INVENTORY (30,000)

NET CASH FROM OPERATIONS 2,012,000

CASH FLOW FROM INVESTING

EQUIPMENT (500,000)

CASH FLOW FROM FINANCING

NOTES PAYABLE 10,000

CASH FLOW YEAR END DEC 31/2003 1,522,000

THANK YOU FOR COMING !

ALL WELCOME!

MICHAEL KORMAN. B. COMM, FMA, FCSI416-493-8786WWW.MICHAELKORMAN.COM