Slides of the Month – December 2013

Overview: As we approach the end of 2013, we believe it is appropriate to re-focus on the asset classes with the most favorable risk/reward characteristics going forward. As US markets are trading near all-time highs, we take a closer look at international equity markets. The next several slides detail our view that international equities remain an attractive place to invest heading into the new year.

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Experience Insight Impact

biegelwaller.com

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Central banks around the world appear poised to continue accommodative monetary and fiscal policies for the foreseeable future:

• “Based on our regular economic and monetary analyses, we decided to lower the interest rate on the main refinancing operations of the Euro system by 25 basis points to 0.25% and the rate on the marginal lending facility by 25 basis points to 0.75%...our monetary policy stance will remain accommodative for as long as necessary.” – Mario Draghi, President of the European Central Bank, November 7, 2013

• Japan’s central bank has indicated that it will add to already unprecedented easing if a setback to the economy warrants it. For now, Governor Haruhiko Kuroda is targeting an annual 60 trillion to 70 trillion yen expansion in the monetary base, with all 36 economists in a Bloomberg News survey expecting the BOJ to maintain this target at a meeting this week. – Bloomberg article, October 22, 2013

Experience Insight Impact

Global Monetary and Fiscal Policy

International Equity-Data

China Manufacturing data appears to be stabilizing Euro-zone Composite PMI remains above earlier lows

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Experience Insight Impact

Global Valuations

Valuation Refresher…..

International equities have substantially more

attractive price/earnings ratios, price/book ratios, and

dividend yields.

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Experience Insight Impact

Recovery In Global Markets

Shanghai is down 63% from peak

S&P 500 is up 15% from 2007 high

Euro Stoxx 50 is down 33% from peak

International Equity markets have not recovered

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Experience Insight Impact

Slides of the Month – Disclaimer

Opinions expressed in this commentary may change as conditions warrant and is for informational purposes only. Information contained herein is not intended to be personal investment advice for any specific person for any particular purpose. We utilize information sources that we believe to be reliable but cannot guarantee the accuracy of those sources. Past performance is no guarantee of future performance; investing involves risk and may result in loss of capital. Consider seeking advice from a professional before implementing any investing strategy.

Experience Insight Impact

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