THE THEMES ARE:

Growth of China, India and the Asian region creates investment opportunity in these markets.

Energy demand will continue to grow; supply is not growing hence energy prices will rise.

Non-U.S. dollar based currencies will continue to appreciate.

Demand for global financial services will grow rapidly.

Industrial metals and precious metals will be needed to further global growth. Supply is stagnant and demand is rising, hence prices will rise.

Transportation equipment is important for this growth to continue.

CHINA TO ALLOW MORE INVESTORS TO OWN STOCKS ABROAD…BULLISH FOR ASIA, ESPECIALLY HONG KONG AND SINGAPORE We anticipate that a great deal of Chinese capital will gradually find its way into the regional stock markets of Asia; first into Hong Kong, then into other Chinese language markets like Singapore, and eventually into the Philippines, Indonesia, Vietnam, etc. We own Singapore and Hong Kong companies for our clients and plan to use market pullbacks to add to these positions. In our view, this growth will continue for many years and is not for a short-term trend.

AREAS OF FOCUS IN HONG KONG AND SINGAPORE In Hong Kong, we are focused on companies which are property developers in Hong Kong, who have also made big commitments to property development in China. Within Singapore, we continue to like many industries, especially financial services. Singapore has a well educated work force, a good port system, stable and efficient non corrupt government, good courts, excellent legal and accounting framework, and a pro business environment with low taxes. We believe Singapore will become the Asian financial capital as London is for Europe, and New York is for North America.

WHAT WE ARE EXPERIENCING IS A LONG-TERM TREND, ASIAN GROWTH WILL CONTINUE FOR MANY, MANY YEARS Not since the industrial revolution of Europe has there been such far reaching change in the global economic background.

THIS IS AN OLD THEME FOR US WE HAVE BEEN SAYING THESE THINGS FOR OVER 5 YEARS, AND OTHERS ARE FINALLY GETTING ON THE BANDWAGON In a major report to clients this week, Morgan Stanley estimates that 30 million Asian people per year, for the next 20 to 25 years, will move from the countryside into Asian cities.

Their analysts predict that 17 million per year in China, and 13 million per year in other Asian countries like India will make the journey. They correctly point out that this huge influx will be due to rising standards of living in Asia, and that immense infrastructure spending will be required to manage this transition.

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