Back to the Future: What Now Marty McFly?...What Now Marty McFly? Certain of the statements contained herein are statements of future expectations and other forward-looking statements

Back to the Future:What Now Marty McFly?

Certain of the statements contained herein are statements of future expectations and other forward-looking statements that are based on management's current views and assumptions and involve known andunknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. This review has been prepared by Westfield Group forinformational purposes only. Any statistics mentioned have been obtained from sources we believed to be reliable, but the accuracy and completeness of the information cannot be guaranteed. Opinions expressedherein reflect the author’s judgment and are subject to change based on economic, market and other conditions. It should not be assumed that this is a forecast of future events or that any security transactions,holdings, or sector discussed were or will be profitable, or that the investment recommendations or decisions we make in the future will be profitable or will equal any investment performance discussed herein.

Ohio Chapter Fall ConferenceColumbus OhioNovember 2015

Scott G Richter CFA, CMT, CHPPortfolio Manger, Westfield Group• 14 Years Functional/Operating Experience• 18 Years Investment Management Business

• Senior Portfolio Manager – Westfield Group• $4B+ AUM/Investment Strategy Team

• Mutual Fund Manager – Fifth Third Asset Management• Large Cap Value

• University of Rochester BSME• Harvard Masters in Business Admin

• Chartered Financial Analyst - CFAI• Chartered Market Technician – MTA• Chartered Hedge Fund Professional – CHP

• scottrichter@westfieldgrp.com; (330) 887-8795

Your Host

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Here We Are – Back to the Future

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Source: Google Images

Where are we going Doc?

• Highlight Major Themesin the Economy

• Review Some Dynamicsin the Capital Markets

• Open Discussion – Q & A

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Source Google Images; Copyright Universal Studios

What Did We Learn from Last Year?

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• Good Content• Entertaining• Too Many Slides• Too Long• More Q&A.

We’ll hit the high points, do it quicker, and getinto more dialogue together…

Source Google Images; Copyright Universal Studios

How’s the US Economy Doc?

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• GDP is slow and bumpy.• Employment is Strong• Company Earnings Face

Headwinds from EM’sand US Dollar.

• Recession Looks 3-5Years Out, Maybe…

• US Fed Might RaiseRates in December,Maybe…

Meh

Source Google Images; Copyright Universal Studios

US GDP – Growth Since 2008-9

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Source: Factset, WFG

US GDP – Average Growth of About 2.25%

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Source: Factset, WFG

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US GDP – Bumpy Growth

Source: Factset, WFG

US Employment – Getting Warmer!

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Source Google Images; Copyright Universal Studios

Payrolls Growing Nicely – Higher than 2007-8

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Source: Evercore ISI

UE Claims at a Record Low…

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Source: Evercore ISI

Earnings Creeping Up…

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Source: Evercore ISI

Wages and New Worth at New Highs…

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Source: Evercore ISI

Company Earning --Facing Headwinds…

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Source: Earnings Scout

Company Revenues --Facing Headwinds Too…

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Source: Earnings Scout

Company Earnings –But Energy is the Drag…

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Source: Factset

But Why Doc?

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• Slowing Global Growth• Slowing Commodity

Complex• Strong US Dollar• Geopolitics??

Source Google Images; Copyright Universal Studios

Slowing Global Growth – China

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Source: Google Images

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Slowing Global Growth - China

Source: Evercore ISI

Slowing Commodity Complex – Globally…

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Source: Stockcharts, WFG

Slowing Commodity Complex – True Collapse

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Source: Stockcharts, WFG

Dollar Impacts – Earnings and Commodities

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Source: Stockcharts, WFG

Dollar Impacts – Earnings and Commodities

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Source: Stockcharts, WFG

Dollar Impacts – Correlations: Rocket Science - NO

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Source: Stockcharts, WFG

Dollar Impacts – How Long?

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Source: Stockcharts, WFG

Geopolitical Hot Spots

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Source: Deutsche Bank

Recession Time Frames

• Yield Curve Inversion– Usually 36 months after FED rate hikes begin

• Average Hourly Earnings Move Up– Usually move up from 2% to 4% in ~ 3 Years– FED typically hikes rates– Once AHE’s accelerate, recession ~ 5 Years

• Run Away Inflation??– Not in Cards Yet…Stay Tuned

• Geopolitical Impacts??

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FED – Masters of the Universe – When to Raise? Lower?

Masters of the Universe Graphic

BenHaruhiko Mario

Janet

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Source SciFiNews.com

Central Banks – Printing Money…

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Source: Yardeni.com

Even Steeper!

Major Central Banks – 2015 and Beyond…The TENSION!

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Major Central Banks – FED Hike – December Odds?

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Source: CME Group

Interest Rates…FED Blinked in September…Jawboning Now…

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Source: Stockcharts, WFG

Central Banks – Marginal Returns? Are We Past the Hump?

Lengthen Time Prevent Pain

What if theyfail?

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Source: Google Images

Central Banks – What If They Fail? What About Long Term?

Lengthen Time Prevent Pain

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Source Wikipedia

The Race to ZeroDick Hokensen

Evercore ISI

Marty – Who Needs Stink’in Oil – We Got Nuclear Fusion…

Lengthen Time Prevent Pain

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Source Google Images; Copyright Universal Studios

Last Year’s Oil…

Lengthen Time Prevent Pain

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Source Stockcharts; WFG

This Years Oil…Even Worse…w/ Record Consumption…

Lengthen Time Prevent Pain

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Source Stockcharts; WFG

You were herelast year! Ouch!

Crude Oil Demand – EM’s Continue to Guzzle…

Lengthen Time Prevent Pain

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Source Yardeni.com

Rigs Down – Production Down Eventually…

Lengthen Time Prevent Pain

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Source Yardeni.com

Fossil Fuels Still in Our Future…Sorry Greenies

Lengthen Time Prevent Pain

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Global Markets…Uninspiring…Uncertainty Dominates

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Source IBD; WFG

11/14/15

S&P 500 Winners/Losers YTD

Lengthen Time Prevent Pain

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Source Stockcharts; WFG

Doc…Looks Like It’s Time to Go…

Summary• US Stable, Steady; Slow• Employment Solid/Confidence• Earnings Tepid

• $$ and Slowdown• Energy Drags

• Global Economy Struggles• China Slowing• Europe Stabilizing• EM’s Gasping for Air

• Dollar Power Hurts Translationsand Commodities

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Source Google Images; Copyright Universal Studios

Doc…Looks Like It’s Time to Go…

Summary• Geopolitics Ramping/Messy• No US Recession in Sight• Central Banks Are Easy

• FED Tensions? Rate Hike?• Inflation? None Found!

• Wages Creeping Up• Commodities Under Pressure

– $$ & Slowdown• Oil Struggles, But Self

Correcting. Consumer Bump.• Markets – Uncertain. Lumpy.

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Source Google Images; Copyright Universal Studios

Lengthen Time Prevent Pain

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Source lightroomkillertips.com

Prevent Pain

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Thank You for Your Attention.Good Luck Seeing Your Bright Future!

Source Google Images; Copyright Universal Studios; Amazon.com