The Global Capital Markets and How They Benefit You and Me

Barry Mendelson, CFP®Financial Advisor & Partner925-988-0330 x22Barry@JustPlans-Etc.com

As of June 30, 2011

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Opinions expressed are those of Barry Mendelson, CFP® and Just Plans Etc.

This presentation should not be construed as investment advice.

The information contained in this presentation is compiled from sources believed to be reliable.

Investments in securities involve the risk of loss. Past performance is no guarantee of future results.

The markets can remain irrational longer than you can remain solvent.

Disclosures

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Barry Mendelson, CFP®

Local investment and personal finance professional. More than 15 years experience working for leading financial services companies including Charles Schwab, AXA Rosenberg, Neuberger Berman, and Franklin Templeton. Prior to joining Just Plans Etc. in 2010, was a Vice President in Charles Schwab & Co’s $250 billion investment management division. Certified Financial Planner™ certificate holder since 2008. B.A. in Business Economics & Accounting from U.C. Santa Barbara in 1995.

Just Plans Etc.

Founded in 1983 and based in Walnut Creek, California - Just Plans is a fee-only wealth management firm and SEC registered investment advisor. Just Plans provides investment management and financial planning services to more than 100 individuals, families, and companies. The firm specializes in tax-efficient investing and helping investors realize meaningful value from qualified retirement plans, concentrated stocks positions, stock options, and other forms of equity. As a fiduciary, the firm puts the interests of the client above all else.

About

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What is “Capital” and a “Market?”

4

Debt – Characteristics

A bond – a loan, rights to interest payments and return of principal at maturity.

Equity – Characteristics

Stocks. Claim on a company’s future cash flow. Ownership.

Other

Market and/or Exchanges

Network of individuals, companies, institutions, and/or governments. Ex, NYSE, NASDAQ, Nikkei

Reduces costs of money for borrowers.

Expanding Global Capital Markets

5

Information Technology – Inexpensive high speed internet, mobile technology. Read “The World is Flat” by Thomas Friedman

Deregulation

Financial instruments – securitization. For example, REITs, Mortgage Backed Securities

Privatization of national companies. For example, Telefonical del Peru – adds equity to financial markets. In theory (and often practice), privately run companies are more efficient than nationalized (government run) companies.

Expanding Global Opportunities

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World Market Capitalization$35.6 Trillion as of December 31, 2010

In US dollars. Market cap data is free-float adjusted from Bloomberg Securities Data. Many small nations not displayed. Totals may not equal 100% due to rounding. Dimensional makes case-by-case determinations about the suitability of investing in each emerging market, making considerations that include local market accessibility, government stability, and property rights, before making investments. For educational purposes; should not be used as investment advice. 1. An example large cap stock provided for comparison.

Capitalization Over Time($ Trillions):

Developed Markets Emerging Markets Frontier Markets

Bloomberg Index Affiliation

International Economic and Demographic Data

7

Source: FactSet, CIA, J.P. Morgan Securities, J.P. Morgan Asset Management.

All GDP Growth data are from J.P. Morgan Economics and expressed as % change versus prior quarter annualized with the exception of India, which is from the India Ministry of Statistics & Programme Implementation and represents % change versus a year ago.All GDP Growth data are for 1Q11. India unemployment is from CIA

estimates and is as of 2010, and Italy unemployment is as of 12/31/10. CPI Inflation is shown as % change versus a year ago and all data are for 1Q11. Unemployment rate for developed countries refers to May 2011 and comes from FactSet Economics, Eurostat and Statistics Canada. Demographic data provided by CIA World Factbookat

CIA.gov.

Data are as of 6/30/11.

Economics DemographicsGDP USD

(B$s) GDP Per Capita

GDP Growth

Unempl. Rate

Inflation (CPI) Population

Population Growth

Percent Age >65

Median Age

Migration per 1000

DevelopedU.S. $15,018 $47,200 1.9% 9.1% 3.4% 313 mm 1.0% 13.1% 36.9 yrs +4.2

Canada 1,330 39,400 3.9 7.4 3.7 34 0.8 15.9 41.0 +5.7

U.K. 2,173 34,800 2.0 7.7 4.5 63 0.6 16.5 40.0 +2.6

Germany 2,940 35,700 6.1 7.0 2.3 81 -0.2 20.6 44.9 +0.5

France 2,145 33,100 3.9 9.7 2.0 65 0.5 16.8 39.9 +1.5

Japan 4,310 34,000 -3.5 4.7 0.3 126 -0.3 22.9 44.8 -

Italy 1,774 30,500 0.4 8.5 3.0 61 0.4 20.3 43.5 +4.9

Emerging

Russia 2,223 15,900 5.1 6.4 9.6 139 -0.5 13.0 38.7 +0.3

Mexico 1,567 13,900 2.1 5.2 3.2 114 1.1 6.6 27.1 -3.2

Brazil 2,172 10,800 5.4 6.4 6.6 203 1.1 6.7 29.3 -0.1

China 10,090 7,600 8.8 4.1 5.5 1,337 0.5 8.9 35.5 -0.3

India 4,060 3,500 8.3 10.8 9.1 1,189 1.3 5.5 26.2 -0.1

U.S. and International Markets Perform Differently

Rolling 12-month Variance (Jan 1972 – Dec 2010)

International Outperforms

U.S. Outperforms

Past Performance is not indicative of future results. All investments involve risk. Foreign securities involve additional risks including foreign currency changes, taxes and different accounting and financial reporting methods. International market performance represented by the MSCI EAFE Index (Morgan Stanley Capital International Europe, Australasia, Far East Index), comprised of over 1,000 companies representing the stock markets of Europe, Australia, New Zealand and the Far East, and is an unmanaged index. EAFE represents non-U.S. large stocks. U.S. market performance represented by the Standard & Poor's 500 Index, an unmanaged market value-weighted index of 500 stocks that are traded on the NYSE, AMEX and NASDAQ. The weightings make each company's influence on the index performance directly proportional to that company's market value.

Global Market Capitalization

Source: Center for Research in Security Prices (CRSP) January, 2011*Source: Impact of an Aging Population on the Global Economy

Jeremy J. Siegel CFA Institute Conference Proceedings Quarterly (09/07)

1970_________________U.S. 66%International 34%

2010_________________U.S. 40%International 60%

2050* (Projected)*_________________U.S. 17%International 83%

Expanding Global Opportunities

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“Sell Side” & “Buy Side”

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The Sell Side: Investment Banks help companies and government raise capital by issuing and selling securities.

The Buy Side: Investors (institutions – government entities, companies, investment companies; and individual investors) purchase these securities.

Bid/Ask spreads.

Currencies

10

The Euro: €, EUR.

Official currency of the Eurozone. 17 of the 23 member states of the European Union.

Adopted in 1995, officially introduced in 1999.

Coins & Banknotes

Purchasing Power Parity

Second Largest Reserve Currency

Implications for investments and business

Foreign Ownership of U.S. Treasuries

Source: J.P. Morgan Asset Management, U.S. Treasury DepartmentTIC.

Data reflects most recently available information as of 6/30/11, published by the U.S. Treasury in April 2011 for the period ending 6/30/10. Based on long- term marketable securities less bills outstanding.

Percentage of U.S. Treasuries Owned by Foreigners Foreign Holders of U.S. TreasuriesBillions USD

Source: J.P. Morgan Asset Management, U.S. Treasury DepartmentTIC.

Caribbean Banking Centers include Bahamas, Bermuda, Cayman Islands, Netherlands Antilles and Panama. Oil countries include Ecuador, Venezuela,

Indonesia, Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, the United Arab Emirates, Algeria, Gabon, Libya and Nigeria.

Data on this page are updated annually each June toreflect revisions by Treasury.

Data are as of June 2011.

All other$1,461

32%

Japan $90720%

China$1,153

26%

Brazil$2075%

Oil countries $2225%

Russia $1253%

Hong Kong$1223%

Caribbean$1383%

Taiwan$1553%

12%14%

22%

19%

35%

41%

46%

51%52% 52%

57%

61%

57%

53%

0%

10%

20%

30%

40%

50%

60%

'78 '84 '89 '94 '00 '02 '03 '04 '05 '06 '07 '08 '09 '10

11

The Gold Standard

12

Till 1944 and the Bretton Woods Agreement

Bretton Woods Agreement

Created World Bank and IMF.

Many countries fixed their currency to that of the U.S. dollar.

Gold

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Year Troy Ounces Total Value

2000 83.3 mm $23 bn

2001 83.6 mm $23 bn

2002 82.0 mm $25 bn

2003 81.7 mm $30 bn

2004 77.8 mm $32 bn

2005 79.4 mm $35 bn

2006 76.2 mm $46 bn

2007 75.9 mm $53 bn

2008 73.6 mm $64 bn

2009 78.8 mm $77 bn

World Gold Production

'75 '80 '85 '90 '95 '00 '05 '10$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

Source: (Left chart) EcoWin , BLS, U.S. Department of Energy, FactSet, J.P. Morgan Asset Management. (Right table) U.S. Geological Survey, World Gold Council, J.P. Morgan Asset Management. CPI adjusted gold values are calculated using month averages of gold spot prices divided by the CPI

value for that month. CPI is rebased to 100 at the start of the chart.

Data reflect most recently available as of 6/30/11.

Gold Prices

Asset

$ / oz

Jun. 2011: $272.03

Jun. 2011: $1,505.50

Jan. 1980: $850.70

Jan. 1980: $326.41

Gold, Inflation adjusted

Gold

Inflation

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Rise in the price of goods and services in economy over time.

Positives

Negatives

Reflects an erosion of purchasing power.

Affects “Real Interest Rates.” Real Interest Rate = Nominal Interest Rate – Inflation

Deflation – Fall in the prices of good and services

Consumer Price Index

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'65 '70 '75 '80 '85 '90 '95 '00 '05 '10-3%

0%

3%

6%

9%

12%

15%

Source: BLS, J.P. Morgan Asset Management.

CPI values shown are % change vs. 1 year ago and reflect May 2011 CPI data. CPI component weights are as of May 2011 and 12- month change reflects data through May 2011 . Core CPI is defined as CPI excluding food and energy prices.

Data reflect most recently available as of 6/30/11.

CPI and Core CPI50-yr. Avg. May 2011

Headline CPI: 4.1% 3.4%

Core CPI: 4.1% 1.5%

% chg vs. prior year, seasonally adjustedCPI Components

Weight in CPI

12-month Change

Food & Bev. 14.8% 3.4%

Housing 41.5% 1.2%

Apparel 3.6% 1.0%

Transportation 17.3% 12.5%

Medical Care 6.6% 3.0%

Recreation 6.3% 0.0%

Educ. & Comm. 6.4% 1.0%

Other 3.5% 1.5%

Headline CPI 100.0% 3.4%

Less:

Energy 9.1% 20.7%

Food 13.7% 3.5%

Core CPI 77.2% 1.5%

Economic Expansions and Recessions

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0

25

50

75

100

125

1900 1912 1921 1933 1949 1961 1980 2001

The Great Depression and Post-War Recessions Length and severity of recession

Great Depression: 26.7% decline in real GDP

Most Recent Recession: 4.1% decline in real GDP

Source: NBER, BEA, J.P. Morgan Asset Management.

Bubble size reflects the severity of the recession, which is calculated as the decline in real GDP from the peak quarter to the trough quarter except in the case of the Great Depression, where it is calculated from the peak year (1929) to the trough year (1933),

due to a lack of available quarterly data.

Source: NBER, J.P. Morgan Asset Management.

*Chart assumes current expansion started in July 2009 and continued through June 2011.

Data for length of economic expansions and recessions obtained from the National Bureau of Economic Research (NBER). These data can be found at www.nber.org/cycles/

and reflects information through June 2011.

For illustrative purposes only.

Data reflect most recently available as of 6/30/11.

Length of Economic Expansions and Recessions

Average Length (months):

Expansions: 44 monthsRecessions: 15 months

*

-3.2%

-0.6%

-2.2%

-2.9%

-1.6%-2.6%

-3.7%

-1.7%

-1.4%

-0.3%

-4.1%

-26.7%

0 yrs

1 yrs

2 yrs

3 yrs

4 yrs

5 yrs

1910 1930 1950 1970 1990 2010L

en

gth

of

Rec

es

sio

n i

n Y

ea

rs

Unemployment Rates Across the U.S.

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Source: BLS, J.P. Morgan Asset Management.

Unemployment rates are as of May 2011.

Data reflect most recently available as of 6/30/11.

9.1%

9.3%

11.7%

12.1%

9.4%

7.3%

9.1%

7.3%

6.0%

8.7%

6.9%

8.0%

5.3%

6.6%

4.1%

4.8%

3.2%6.6%

6.0%

8.9%

7.8%

8.2%

9.6%10.3% 9.8%

10.6%

9.7%

8.9%

7.4%10.3%

8.2%8.6%

9.8%

9.7%

6.0%8.6%

7.4%

7.9%

6.8%8.0%9.4%

9.8% (DC)

10.9%

7.7%5.4%4.8%

7.6%

9.1%

10.0%

Lowest Quintile

Second Quintile

Third Quintile

Fourth Quintile

Highest Quintile

7.4%

6.0%

Job Growth, Productivity, and the Labor Force

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'92 '94 '96 '98 '00 '02 '04 '06 '08 '1064%

65%

66%

67%

68%

'92 '94 '96 '98 '00 '02 '04 '06 '08 '10-2%

0%

2%

4%

6%

8%

Source: BLS, FactSet, J.P . Morgan Asset Management.

Labor Productivity: Output per HourNon- farm business productivity, % change year-over-year

20 Years – Net Job CreationNet change in millions of payroll jobs, sa

1Q11:1.3%

Source: BLS, FactSet, J.P . Morgan Asset Management.

Data reflect most recently available as of 6/30/11.

Labor Force Participation Rate% of population aged 16+ working or looking for work

20-yr. average: 66.3%

20-yr. average: 2.4%

May 2011: 64.2%

-5.4

0.8

1.2

1.1

2.8

4.0

4.0

6.5

7.0

-6.0 -4.0 -2.0 0.0 2.0 4.0 6.0 8.0

Manufacturing

Mining & Construction

Other Services

Government

Trade & Retailing

Leisure & Hospitality

Education

Fin. & Bus. Services

Health Care

The Aftermath of the Housing Bubble

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'95 '00 '05 '103

4

5

6

7

8

9

1

2

3

4

5

6

10%

15%

20%

25%

30%

35%

40%

'75 '80 '85 '90 '95 '00 '05 '10

'90 '92 '94 '96 '98 '00 '02 '04 '06 '08 '10$0

$3,000

$6,000

$9,000

$12,000

$15,000

'95 '00 '05 '1080

100

120

140

160

180

200

220

240 Home Price Changes: 1-year: - 5% 3-years: -20%5-years: -26%10-years: 9%

$ thousands, seasonally adjustedHome EquityBillions USD, saar

Sources: (Top left) National Association of Realtors, FactSet, J.P. Morgan Asset Management. (Top right) Federal Reserve, FactSet, J.P. Morgan Asset Management. (Bottom left) Census Bureau, National Association of Realtors, J.P. Morgan Asset Management. (Bottom right) Census Bureau, FRB, BEA, J.P. Morg an Asset Management.

Home price based on median sales price of existing homes and are cumulative, not annualized. Home sales includes both new and existing homesales. Existing home sales include single- family, townhomes, condominiums and co- ops. Note: Calculation for bottom right chart assumes a 20%

down payment, a 30- year fixed rate mortgage, excludes property tax and homeowners’ insurance and is expressed as a percent of pre-tax income.Data reflect most recently available as of 6/30/11.

Affordability: Mortgage Payment on Average New Home% of average household personal income

Median Existing Home Prices

10-years

5-years

3-years

1-year

May 2011: 12.1%

Home Sales and InventoriesMillions, annual rate, seasonally adjusted

May 2011:3.8

1Q11:$6,124

1Q06:$13,504

Home Sales Inventories

May 2011: 5.1

Global Commodities

20

'02 '03 '04 '05 '06 '07 '08 '09 '100

50

100

150

200

250

300

350

400

450

500

0

500

1000

1500

2000

2500

'96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10

Source: Dow Jones/UBS, FactSet, J.P. Morgan Asset Management.

Commodity prices represented by the appropriate DJ/UBS Commodity sub- index.

Data reflect most recently available as of 6/30/11.

Source: USDA, BP Statistical Review of World Energy, J.P. Morgan Asset Management.

Data are as of 6/30/11.

Asset

Commodity Prices Weekly index prices rebased to 100

Precious metals

Industrial metals

Energy

Livestock

Grains

Oil Demand: Emerging Markets Share Emerging markets as % of total global oil consumption

Grain Demand: Emerging vs. Developed MarketsMillions of metric tons

Emerging Markets

Developed Markets

30%

32%

34%

36%

38%

'96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09

Market Views

21

Inefficient Market View

Fundamental Analysis

Technical Analysis

Efficient Market View

Average Investor Performance = Performance for entire market – transaction costs

Therefore, lowering transaction costs may be the simplest and easiest thing to do to improve investment performance.

Active Money Managers Have Difficulty Beating the Market

Mutual Fund Manager Performance from 2006 – 2010

Source: Standard and Poor’s Index Versus Active Group, March 2011 Indexes are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio. The fund returns used are net of fees, excluding loads. Returns are based upon equal-weighted fund counts. The data assumes reinvestment of income and does not account for taxes or transaction costs. The risks associated with stocks potentially include increased volatility (up and down movement in the value of your assets) and loss of principal. Bonds are subject to risks, including interest rate risk which can decrease the value of a bond as interest rates rise. Investing in foreign securities may involve certain additional risks, including exchange rate fluctuations, less liquidity, greater volatility, different financial and accounting standards and political instability. Passive money management, like active money management, cannot guarantee a profit or protect against a loss. Past performance is not a guarantee of future results.

Efficient Market View

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HighestReturn

LowestReturn

The Need for DiversificationAsset Class Index Performance 1996-2010

Diversification does not guarantee a profit or protect against a loss.Data Sources: Center for Research in Security Prices (CRSP), BARRA Inc. and Morgan Stanley Capital International, January 2011. All investments involve risk. Foreign securities involve additional risks, including foreign currency changes, political risks, foreign taxes, and different methods of accounting and financial reporting. Past performance is not indicative of future performance. Treasury bills are guaranteed as to repayment of principal and interest by the U.S. government. This information does not constitute a solicitation for sale of any securities. CRSP ranks all NYSE companies by market capitalization and divides them into 10 equally-populated portfolios. AMEX and NASDAQ National Market stocks are then placed into deciles according to their respective capitalizations, determined by the NYSE breakpoints. CRSP Portfolios 1-5 represent large-cap stocks; Portfolios 6-10 represent small caps; Value is represented by companies with a book-to-market ratio in the top 30% of all companies. Growth is represented by companies with a book-to-market ratio in the bottom 30% of all companies. S&P 500 Index is the Standard & Poor’s 500 Index. The S&P 500 Index measures the performance of large-capitalization U.S. stocks. The S&P 500 is an unmanaged market value-weighted index of 500 stocks that are traded on the NYSE, AMEX and NASDAQ. The weightings make each company’s influence on the index performance directly proportional to that company’s market value. The MSCI EAFE Index (Morgan Stanley Capital International Europe, Australasia, Far East Index) is comprised of over 1,000 companies representing the stock markets of Europe, Australia, New Zealand and the Far East, and is an unmanaged index. EAFE represents non-U.S. large stocks. Foreign securities involve additional risks, including foreign currency changes, political risks, foreign taxes and different methods of accounting and financial reporting. Consumer Price Index (CPI) is a measure of inflation. REITs, represented by the NAREIT Equity REIT Index, is an unmanaged market cap-weighted index comprised of 151 equity REITS. Emerging Markets index represents securities in countries with developing economies and provide potentially high returns. Many Latin American, Eastern European and Asian countries are considered emerging markets. Indexes are unmanaged baskets of securities without the fees and expenses associated with mutual funds and other investments. Investors cannot directly invest in an index.

Asset Class Performance

23

Diversification and the Average Investor

24

20-year Annualized Returns by Asset Class (1991 – 2010)

(Top) Indexes and weights of the traditional portfolio are as follows: U.S. stocks: 55% S&P 500, U.S. bonds: 30% Barclays Capital Aggregate. International stocks:

15% MSCI EAFE. Portfolio with 25% in alternatives is as follows: U.S. stocks: 22.1% S&P 500, 8.8% Russell 2000; International Stocks: 4.4% MSCI EM, 13.2% MSCI EAFE; U.S. Bonds: 26.5% Barclays Capital Aggregate; Alternatives: 8.3% CS/Tremont Equity Market Neutral, 8.3% DJ/UBS Commodities, 8.3% NAREIT Equity REIT Index. Return and standard deviation calculated

using Zephyr.Charts are shown for illustrative purposes only. Past returns are no guarantee of future results. Diversification does not guarantee investment returns and does not eliminate risk of loss. Data are as of

6/30/11.

(Bottom) Indexes used are as follows: REITS: NAREIT Equity REIT Index, EAFE: MSCI EAFE, Oil: WTI Index, Bonds: Barclays Capital U.S. Aggregate Index, Homes: median sale price of existing single- family homes, Gold: USD/troy oz, Inflation: CPI. Average asset allocation investor return is based on an

analysis by Dalbar Inc. which utilizes the net of aggregate mutual fund sales, redemptions and exchanges each month as a measure of investor behavior. Returns are annualized (and total return where applicable)

and represent the 20- year period ending 6/30/11 to match Dalbar’smost recent analysis.

Traditional Portfolio More Diversified Portfolio

Return: 6.86%Standard Deviation: 11.12%

Return: 7.92%Standard Deviation: 9.99%

Maximizing the Power of Diversification (1994 – 2010)

55%

15%

30% S&P 500

MSCI EAFE

Barclays Agg.

8%8%

8%

22%9%

13%4%

26%

Equity Mkt. Neutral

Commodities

REIT

S&P 500

Russell 2000

MSCI EAFE

MSCI EM

Barclays Agg.

10.5%

8.0% 7.7%7.2%

6.1%

4.7%

2.8% 2.6% 2.4%

0%

2%

4%

6%

8%

10%

12%

REITS Oil S&P 500 Gold Bonds EAFE Homes Average Investor

Inflation

Average Duration

Bull Market: 413 DaysBear Market: 220 Days

Average Return

Bull Market: 58%Bear Market: -21%

220%

-13%

-85%

20%

-16%

-39%

119%

87%

27%

-15%-10%

-13%

100%

44%

-53%

25%

40%

-13%-14%

26%

-25%

22%

-11%

23%

-33%

83%

-11%

99%

-26%

19%

-11%-

16%

26%

53%

91%

-13%

121%

-11%

26%

-13%

18%

69%

-21%-11%

44%

-27%

15%

96%

-11%

59%

-27%

-10% -

21% -32%

56%

-12%

38%

-45%

22%

-13%

50%

-13%

38%

-15%

27%

-13%

26%

-10%

21%

-16%

48%

-20%

78%

-11%

156%

-33%

73%

-10%

16%

-19%

303%

-12%

37%

50%

-19%

-12%

23%

-11%

13%

-47%

21%

-14%

113%

03/09/2009-55%

12/31/2010

-13%1%

1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010

S&P 500 Index (USD)Daily Returns: January 1, 1926 - December 31, 2010

Bull and Bear Markets

25

Indices are not available for direct investment; its performance does not reflect the expenses associated with the management of an actual portfolio. Past performance is no guarantee of future results. The S&P data are provided by CRSP (January 1, 1926–August 31, 2008) and Bloomberg (September 1, 2008–present). Returns include reinvested dividends. Bull and bear markets are defined in hindsight using cumulative daily returns. A bear market (1) begins with a negative daily return, (2) must achieve a cumulative return less than or equal to -10%, and (3) ends at the most negative cumulative return prior to achieving a positive cumulative return. All data points which are not considered part of a bear market are designated as a bull market. Performance data represents past performance and does not predict future performance.

Monthly: January 1926 - December 2010

CRSP data provided by the Center for Research in Security Prices, University of Chicago. The S&P data are provided by Standard & Poor's Index Services Group. US long-term bonds, bills, inflation, and fixed income factor data © Stocks, Bonds, Bills, and Inflation Yearbook™, Ibbotson Associates, Chicago (annually updated work by Roger G. Ibbotson and Rex A. Sinquefield).

$8,201Small Cap(CRSP 6-10 Index)

$2,590Large Cap (S&P 500 Index)

$85Long-Term Government Bonds Index$20Treasury Bills

$12Inflation (CPI)

$10,000

$1,000

$100

$10

$1

$0

1926 1936 1946 1956 1966 1976 1986 1996 2006 2010

Growth of Wealth

26

Asset Class Returns

27

10-yrs2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 YTD 2Q11 '01 - '10

REITsDJ UBSCmdty

MSCIEME

REITsMSCIEME

REITsMSCIEME

Barclays Agg

MSCIEME

REITs REITs REITsMSCIEME

13.9% 23.9% 56.3% 31.6% 34.5% 35.1% 39.8% 5.2% 79.0% 28.0% 10.6% 2.9% 350.0%

Market Neutral

Barclays Agg

Russell 2000

MSCIEME

DJ UBSCmdty

MSCIEME

MSCI EAFE

Market Neutral

MSCI EAFE

Russell 2000

Russell 2000

Market Neutral

REITs

9.3% 10.3% 47.3% 26.0% 17.6% 32.6% 11.6% 1.1%* 32.5% 26.9% 6.2% 2.3% 178.0%

Barclays Agg

Market Neutral

MSCI EAFE

MSCI EAFE

MSCI EAFE

MSCI EAFE

DJ UBSCmdty

Asset Alloc.

REITsMSCIEME

S&P500

Barclays Agg

Russell 2000

8.4% 7.4% 39.2% 20.7% 14.0% 26.9% 11.1% -23.8% 28.0% 19.2% 6.0% 2.3% 84.8%

Russell 2000

REITs REITsRussell 2000

REITsRussell 2000

Market Neutral

Russell 2000

Russell 2000

DJ UBSCmdty

Market Neutral

MSCI EAFE

Asset Alloc.

2.5% 3.8% 37.1% 18.3% 12.2% 18.4% 9.3% -33.8% 27.2% 16.7% 5.8% 1.8% 80.2%

MSCIEME

Asset Alloc.

S&P500

Asset Alloc.

Asset Alloc.

S&P500

Asset Alloc.

DJ UBSCmdty

S&P500

S&P500

MSCI EAFE

Asset Alloc.

Market Neutral

-2.4% -5.4% 28.7% 12.5% 8.0% 15.8% 7.3% -36.6% 26.5% 15.1% 5.4% 0.7% 76.9%.

Asset Alloc.

MSCIEME

Asset Alloc.

S&P500

Market Neutral

Asset Alloc.

Barclays Agg

S&P500

Asset Alloc.

Asset Alloc.

Asset Alloc.

S&P500

Barclays Agg

-3.4% -6.0% 25.2% 10.9% 6.1% 14.9% 7.0% -37.0% 22.5% 12.7% 4.5% 0.1% 76.3%

S&P500

MSCI EAFE

DJ UBSCmdty

DJ UBSCmdty

S&P500

Market Neutral

S&P500

REITsDJ UBSCmdty

MSCI EAFE

Barclays Agg

MSCIEME

MSCI EAFE

-11.9% -15.7% 22.7% 7.6% 4.9% 11.2% 5.5% -37.7% 18.7% 8.2% 2.7% -1.0% 47.1%

MSCI EAFE

Russell 2000

Market Neutral

Market Neutral

Russell 2000

Barclays Agg

Russell 2000

MSCI EAFE

Barclays Agg

Barclays Agg

MSCIEME

Russell 2000

DJ UBSCmdty

-21.2% -20.5% 7.1% 6.5% 4.6% 4.3% -1.6% -43.1% 5.9% 6.5% 1.0% -1.6% 41.7%

DJ UBSCmdty

S&P500

Barclays Agg

Barclays Agg

Barclays Agg

DJ UBSCmdty

REITsMSCIEME

Market Neutral

Market Neutral

DJ UBSCmdty

DJ UBSCmdty

S&P500

-22.3% -22.1% 4.1% 4.3% 2.4% -2.7% -15.7% -53.2% 4.1% -2.5% -2.6% -6.7% 15.1%

Asset

Source: Russell, MSCI, Dow Jones, Standard and Poor’s, Credit Suisse, Barclays Capital, NAREIT, FactSet, J.P . Morgan Asset Management. The “Asset Allocation” portfolio assumes the following weights: 25% in the S&P 500, 10% in the Russell 2000, 15% in the MSCI EAF E, 5% in the MSCI EMI, 30% in the Barclays Capital Aggregate, 5% in the CS/Tremont Equity Market Neutral Index, 5% in the DJ UBS Commodity Index and5% in the NAREIT Equity REIT Index. Balanced portfolio assumes annual rebalancing. All data except commodities represent total return for stated period. Past performance is not

indicative of future returns. Data are as of 6/30/11, except for the CS/Tremont Equity Market Neutral Index, which reflects data through5/31/11. “10- yrs” returns represent cumulative total return and are not annualized. These returns reflect the period from 1/1/01 – 12/31/10.

Please see disclosure page at end for index definitions. *Market Neutral returns include estimates found in disclosures.Data are as of 6/30/11.

Historical Returns by Holding Period

Historical Returns by Holding Period

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-37%

-8%

-15%

-2% -2% 1%-1% 1% 2%

6%

1%5%

51%

43%

32%28%

23% 21% 19%16% 17% 18%

12%14%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

60%

1-yr. 5-yr. rolling 10-yr. rolling 20-yr. rolling

Annual total returns, 1950 – 2010Range of Stock, Bond and Blended Total Returns

Asset Sources: Barclays Capital, FactSet, Robert Shiller, Strategas/Ibbotson, Federal Reserve, J.P. Morgan Asset Management.

Data are as of 6/30/11.

50/50 Portfolio 9.0% $559,744

Bonds 6.2% $336,138

Stocks 10.9% $792,519

Annual Avg. Total Return

50/50 Portfolio

Bonds

Stocks

Growth of $100,000 over 20 years

Conclusion and Q&A

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1. Be a student of the global financial markets.

2. Simpler is often better.

3. Don’t invest in anything you don’t fully understand.

4. Collaborate and network with others.

More articles at:www.justplans-etc.blogspot.com

Barry Mendelson, CFP® Financial Advisor & Partner

925-988-0330 ext. 22 1399 Ygnacio Valley Rd, Suite 24 Barry@JustPlans-Etc.com Walnut Creek, CA 94598

www.JustPlans-Etc.com

Contact info

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