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( ")The analyses and conclusions of the Western Investment Club WIC contained in this.presentation are based on publicly available information WIC recognizes that there may be

confidential information in the possession of the companies discussed in the presentation .that could lead these companies to disagree with WIC s conclusions This presentation and

the information contained herein is not a recommendation or solicitation to buy or sell.any securities

,The analyses provided may include certain statements estimates and projections prepared, ,with respect to among other things the historical and anticipated operating performance, .of the companies access to capital markets and the values of assets and liabilities Such

, ,statements estimates and projections reflect various assumptions by WIC concerning, ,anticipated results that are inherently subject to significant economic competitive and

other uncertainties and contingencies and have been included solely for illustrative. , ,purposes No representations express or implied are made as to the accuracy or

,completeness of such statements estimates or projections or with respect to any other.materials herein Actual results may vary materially from the estimates and projected

.results contained herein

Disclaimer

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hat is an economic indicator?

Economic Indicators What are they?

Statistics or data used to analyze current economicactivityUseful for identifying stages in the business cycle ,From an investors point of view economic indicators can

help shape an investment strategy If any indicator suggests that the economy is going to

,do worse or better than previously expected then.decisions may change

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he Business Cycle

Economic Indicators The Business Cycle

The Business CycleGDP

Peak

Trough

Trough

Peak

Peak

ExpansionContraction Recovery

Recovery

Expansion

Contraction

Time

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, ,eading Lagging or Coincident

Economic Indicators Timing

T he timing of economic indicators reflects whether the,overall economic conditions have changed are changing or will change

Leading Indicators which change before the economy

.changes They help predict what the economy will be like

in the future as they re more highly correlated with future ( .GDP rather than past or current Ex Housing

)StartsLagging Indicators that change after the economy

,changes hence are more highly correlated with past .GDP,They reflect how the economy has performed in the past

( . )often a few months or quarters ago Ex Unemployment rate

oincident Indicators that move at the same time as( . ).the economy Ex Retail Sales They are most correlated

with current GDP

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L ag gi ng I nd ic at or

Economic Indicators Timing

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hat are some examples?

Economic Indicators Examples

Leading Indicators Coincident Indicators Lagging Indicators

Housing StartsManufacturers neworders

Spot commodity pricesAvg. Hours worked per week Money Flows

Industrial productionPersonal incomeRetail sales

Business investmentspendingUnemployment

Labour CostsInventory LevelsInflation

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hen do we get this information?

Economic Indicators Frequency of Information

requency How often the information is available : ,Examples GDP is released quarterly unemployment is

, ( . )released monthly and Indices ex Dow Jones is available.immediately and changes quite often

Figures that come out infrequently often have a larger impact on the capital markets compared with those

released often

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ow can this help us?

Economic Indicators

Economic indicators can be used to support an invesment,thesis or to demonstrate potential investment risks

Decisions shouldn t be based on economic

/ indicators economic trends alone they should be used

in conjunction with fundamental analysis

, - As a value investing club we take a bottom up approach

, ,to investing and look for good companies rather than companies that stand to benefit form changing economic

conditions

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hat can we see right now?

-Economic Indicators Some Current Indicators

Indicator Unit Summar y

Vs. Previous

DateRetail Sales(Procyclical/Coincident)

CAD 35,856,000,000

-25,000,000

July.2010

Building Permits Value

Seasonally Adjusted(Procyclical/Leading)

CAD 5,748,00

0,000

-585,800,

000

Aug.

2010Money Supply(Procyclical/Leading)

CAD 218,581,000,000

872,000,000

Aug.2010

Prime Interest Rate(Procyclical/Lagging)

% 2.75 0.25 July2010

Unemployment(Countercyclical/Lagging)

% 8.0 -0.8 Sept.2010

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Cartoon

Economic Indicators

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