Download - Ben Davies
Hinde Gold FundSingularity – Transcendent MoneyGold Symposium, Sydney AustraliaNovember 2011
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – tranScendent Money Key ConCepTS
– Singularity
– exponential vs Linear Growth Trends
– Law of Accelerating Returns vs Law of diminishing Returns
– Financial Oppression
– internet Reformation
– Transcendent Money
– Monetary Singularity
02
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity - MatheMatical
Source: Ray Kurzweil, 199903
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – Schwarzchild Black hole
04
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Singularity – “Mother of all”Big Bang - (Keplers) Supernova nucleosynthesis.
05
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – technological“ The singularity will allow us to transcend the limitations of our biological bodies and brains. There will be no distinction, post singularity, between human and machine.”
Source: Ray Kurzweil, 199906
CoUnTDoWn To SInGULARITy
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – exponential trendLinear vs exponential trend growth. note the initial imperceptible growth which accelerates at a point in time called the “Knee of the curve”.
Source: Ray Kurzweil, 199907
LIneAR VS eXponenTIAL GRoWTH
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – law of accelerating returnSexponential curve on Log Scale – the exponential of the rate of exponential.
Source: Ray Kurzweil, 199908
eXponenTIAL GRoWTH oF CoMpUTInG
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – Moore’S law dynamic RAM (Random Access Memory) illustrates Moore’s Law.
dRAM size shrink by half every 5.4 years.Cost of dRAM per square millimeter falling - dRAM bits per dollar doubles every 1.5 years.
Source: Ray Kurzweil, 199909
DynAMIC RAM pRICeDynAMIC RAM
Singularity - productivityHalf-lifes or doubling times.
Source: Ray Kurzweil, 1999
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
10
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – progreSSive purchaSing power
Source: Ray Kurzweil, 199911
pRoCeSSoR peRFoRMAnCe
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Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – productivitydemand outstrips deflation in cost of information technologies.
Source: Ray Kurzweil, 199912
ToTAL BITS SHIppeD
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Singularity – productivity Miracle?Real GdP growth. A productivity miracle or a function of credit expansion?
Source: Ray Kurzweil, 199913
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
ReAL GRoSS DoMeSTIC pRoDUCT
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – law of diMiniShing returnS
Source: Marc Faber – Gloom Doom Boom Report14
-0.4
-0.2
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
Sep
-60
Sep
-63
Sep
-66
Sep
-69
Sep
-72
Sep
-75
Sep
-78
Sep
-81
Sep
-84
Sep
-87
Sep
-90
Sep
-93
Sep
-96
Sep
-99
Sep
-02
Sep
-05
Sep
-08
Annual change in GDP divided by the annual change in total debt to GDP, 4Q mov average.
DIMInISHInG ReTURnS FRoM An ADDITIonAL $1 oF DeBT In THe US eConoMy
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – linear deBt trendS
15
400%
200%
0%
-200%
-400%
-600%
-800%
-10,00%
-1,200%
-1,400%
-1,600%
-1,800%
Italy Germany France Portugal UnitedStates
UnitedKingdom
Spain Ireland Greece
Source: EU Commission, Eurostat, CBO, IMF, Morgan Stanley Research
TOTAL DEBT & LIABILITIES AS % OF GDP
Cost of ageing Structural deficit Initial debt level
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – exponential deBt trendS
16
0.0
2,000.0
4,000.0
6,000.0
8,000.0
10,000.0
12,000.0
Dec
-58
Dec
-60
Dec
-62
Dec
-64
Dec
-66
Dec
-68
Dec
-70
Dec
-72
Dec
-74
Dec
-76
Dec
-78
Dec
-80
Dec
-82
Dec
-84
Dec
-86
Dec
-88
Dec
-90
Dec
-92
Dec
-94
Dec
-96
Dec
-98
Dec
-00
Dec
-02
Dec
-04
Dec
-06
Dec
-08
Dec
-10
Dec
-12
M2 (USD billion) Exponential Forcast
0.0
10,000.0
20,000.0
30,000.0
40,000.0
50,000.0
60,000.0
Dec
-58
Dec
-60
Dec
-62
Dec
-64
Dec
-66
Dec
-68
Dec
-70
Dec
-72
Dec
-74
Dec
-76
Dec
-78
Dec
-80
Dec
-82
Dec
-84
Dec
-86
Dec
-88
Dec
-90
Dec
-92
Dec
-94
Dec
-96
Dec
-98
Dec
-00
Dec
-02
Dec
-04
Dec
-06
Dec
-08
Dec
-10
Dec
-12
Total Debt (USD billion) Exponential Forcast
THe US M2 FITTeD To An eXponenTIAL TRenD THe US ToTAL DeBT (In USD BILLIon) FITTeD To An eXponenTIAL TRenD
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – log Monetary trend
17
6.0
6.5
7.0
7.5
8.0
Dec-95
Jul-96
Feb-97
Sep-97
Apr-98
Nov-98
Jun-99
Jan-00
Aug-00
Mar-01
Oct-01
May-02
Dec-02
Jul-03
Feb-04
Sep-04
Apr-05
Nov-05
Jun-06
Jan-07
Aug-07
US MoneTARy BASe (LoG TeRMS)
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – Money velocity
18
-12%
-10%
-8%
-6%
-4%
-2%
0%
2%
4%
6%
8%
Jun-6
1
Jun-6
4
Jun-6
7
Jun-7
0
Jun-7
3
Jun-7
6
Jun-7
9
Jun-8
2
Jun-8
5
Jun-8
8
Jun-9
1
Jun-9
4
Jun-9
7
Jun-0
0
Jun-0
3
Jun-0
6
Jun-0
9
Recessions Monetary Velocity YoY
MoneTARy VeLoCITy yoy
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – “puMpty puMpty puMp...”
19
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – e.f.S.f.european Financial Stability Facility or european FUBAR Slush Fund?
“ it is tied to higher risks of losses and to increased sharing of risks. The way they are constructed, the leveraging instruments are not too different from those which are responsible for creating the crisis, because they are concealed risks.”
Jens Weidmann, President of the German Bundesbank20
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
21
Singularity – MonolineAMBAC: the muni and sub-prime monoline insurer. A taste of things to come for the eFSF monoline insurer?
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
90.0
100.0Jul-91
Jul-92
Jul-93
Jul-94
Jul-95
Jul-96
Jul-97
Jul-98
Jul-99
Jul-00
Jul-01
Jul-02
Jul-03
Jul-04
Jul-05
Jul-06
Jul-07
Jul-08
Jul-09
Jul-10
Jul-11
AMBAC US (SHARe pRICe)
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – gloBal Monetary trendSUK Qe has been 45% bigger than the Fed’s Qe.
22
0
100,000
200,000
300,000
400,000
500,000
600,000
Jun-06
Sep-06
Dec-06
Mar-07
Jun-07
Sep-07
Dec-07
Mar-08
Jun-08
Sep-08
Dec-08
Mar-09
Jun-09
Sep-09
Dec-09
Mar-10
Jun-10
Sep-10
Dec-10
Mar-11
Jun-11
Sep-11
0
500
1,000
1,500
2,000
2,500
3,000
3,500
Jun-06
Sep-06
Dec-06
Mar-07
Jun-07
Sep-07
Dec-07
Mar-08
Jun-08
Sep-08
Dec-08
Mar-09
Jun-09
Sep-09
Dec-09
Mar-10
Jun-10
Sep-10
Dec-10
Mar-11
Jun-11
Sep-11
BAnK oF enGLAnD ToTAL ASSeTS eCB ToTAL ASSeTS
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – gloBal Monetary trendSThe illusion of sobriety.
23
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Oct-
08
Dec-0
8
Feb-0
9
Apr-
09
Jun-0
9
Aug-0
9
Oct-
09
Dec-0
9
Feb-1
0
Apr-
10
Jun-1
0
Aug-1
0
Oct-
10
Dec-1
0
Feb-1
1
Apr-
11
Jun-1
1
Aug-1
1
Oct-
11
Agencies MBS US Treasuries
CoMpoSITIon oF FeD BALAnCe SHeeT, SeCURITIeS poRTFoLIo
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
1,800,000
Apr-98
Oct-98
Apr-99
Oct-99
Apr-00
Oct-00
Apr-01
Oct-01
Apr-02
Oct-02
Apr-03
Oct-03
Apr-04
Oct-04
Apr-05
Oct-05
Apr-06
Oct-06
Apr-07
Oct-07
Apr-08
Oct-08
Apr-09
Oct-09
Apr-10
Oct-10
Apr-11
JApAn BoJ BALAnCe SHeeT ToTAL ASSeTS (100 MILL Jpy)
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – price trendSQe impact on corporate bond spreads, S&P500, Commodities and dollar.
24
300
350
400
450
500
550
600
650
700
Jan-
06
Apr
-06
Jul-0
6
Oct
-06
Jan-
07
Apr
-07
Jul-0
7
Oct
-07
Jan-
08
Apr
-08
Jul-0
8
Oct
-08
Jan-
09
Apr
-09
Jul-0
9
Oct
-09
Jan-
10
Apr
-10
Jul-1
0
Oct
-10
Jan-
11
Apr
-11
Jul-1
1
Oct
-11
400
420
440
460
480
500
QE1
On Hold to 2013
Continuous Commodity Index
Asian Currency Index (RHS)
QE2
ConTInUoUS CoMMoDITy InDeX AnD ASIAn CCy InDeX
500
700
900
1,100
1,300
1,500
1,700
1,900
Jan-
06
Apr
-06
Jul-0
6
Oct
-06
Jan-
07
Apr
-07
Jul-0
7
Oct
-07
Jan-
08
Apr
-08
Jul-0
8
Oct
-08
Jan-
09
Apr
-09
Jul-0
9
Oct
-09
Jan-
10
Apr
-10
Jul-1
0
Oct
-10
Jan-
11
Apr
-11
Jul-1
1
Oct
-11
QE1
QE2
On Hold to 2013
S&P
BAA Corp Spread (scaled)
BAA CoRp SpReAD AnD S&p RATIo
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Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – coMModity vS fiat paper MoneyGold price (y) or (1/x) is an inverse function of paper money (x).
25Purchasing Power of Fiat Money (increasing) >
Gold Price
pURCHASInG poWeR oF FIAT Money AnD THe GoLD pRICe
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Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – financial oppreSSion
Monetary and Fiscal Policy at a ‘practical limit’
Financial Legislation, regulation and taxation enables ‘Capital Conscription’
Conscripted Capital ie ‘grab’ capital mandatorily
• Quantitative and Qualitative easing (financial repression) • ‘dodd-Frank –esque’ Global Financial Regulation Acts • nationalisation of Money Centres and Pension companies • FATCA, FTT or Tobin Tax, double Tax Treaties (US, UK and Switzerland)
• Mining Taxes, Windfall Taxes, nationalisation of Mines
26
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – financial oppreSSionGame of Twist(er) anyone?
27
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
Jan-80
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10
US 30y GoVeRnMenT BonD yIeLDS
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – financial oppreSSionnet central bank purchases of US Treasuries as a % of total issuance.
Central Bank printers financing US government.
Source: Russell Napier, CLSA 28
HINDE GOLD FUND OUTPERFORMANCE(BASED AT 100 ; OCTOBER 2008)
75
100
125
150
175
Oct
-08
Dec
-08
Feb
-09
Apr
-09
Jun-
09
Aug
-09
Oct
-09
Dec
-09
Feb
-10
Apr
-10
Jun-
10
Aug
-10
Oct
-10
Dec
-10
Feb
-11
Apr
-11
Jun-
11
Cumulative Net Overall AlphaCumulative Strategic (Gross)Cumultaive Juniors (Gross)
160
140
120
100
80
60
40
20
0
(20)
(40)2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
NET CENTRAL - BANK PURCHASES OF US TREASURIES AS A % OF ISSUANCE
(%)
FOREIGN CENTRAL BANKS’ SHARE OF TREASURY MARKET HAS PEAKED
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
20
18
22
24
26
28
30
30
34
36
38
40 (%)
SHARE OF TREASURY MARKET NOT OWNED BY CENTRAL BANKS
90
85
80
75
70
65
60
55
501961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2011
(%)
US PAPER COMMERCIAL OUTSTANDING
2007 2008 2009 2010 2011
2,200
2,000
1,800
1,600
1,400
1,200
1,000
800
(US$bn)
US CORPORATE PROFITS AFTER TAX (NIPA DATA) AND S&P500 REPORTED EPS
81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 110
90
80
70
60
50
40
30
20
10
1,100
1,100
900
800
700
600
500
400
300
200
100
0
US CORPORATE PROFITS AFTER TAXS&P500 REPORTED EARNINGS (RHS)
(US$bn)
(%)
150
2
3
4
5
6
7
8
9
55 60 65 70 75 80 85 90 95 00 05 10
CORPORATE TAX TAKE AS A % OF GDP
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – financial oppreSSionForeign central banks’ Treasury market share peaked at close to 40%.
Source: Russell Napier, CLSA 29
HINDE GOLD FUND OUTPERFORMANCE(BASED AT 100 ; OCTOBER 2008)
75
100
125
150
175
Oct
-08
Dec
-08
Feb
-09
Apr
-09
Jun-
09
Aug
-09
Oct
-09
Dec
-09
Feb
-10
Apr
-10
Jun-
10
Aug
-10
Oct
-10
Dec
-10
Feb
-11
Apr
-11
Jun-
11
Cumulative Net Overall AlphaCumulative Strategic (Gross)Cumultaive Juniors (Gross)
160
140
120
100
80
60
40
20
0
(20)
(40)2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
NET CENTRAL - BANK PURCHASES OF US TREASURIES AS A % OF ISSUANCE
(%)
FOREIGN CENTRAL BANKS’ SHARE OF TREASURY MARKET HAS PEAKED
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
20
18
22
24
26
28
30
30
34
36
38
40 (%)
SHARE OF TREASURY MARKET NOT OWNED BY CENTRAL BANKS
90
85
80
75
70
65
60
55
501961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2011
(%)
US PAPER COMMERCIAL OUTSTANDING
2007 2008 2009 2010 2011
2,200
2,000
1,800
1,600
1,400
1,200
1,000
800
(US$bn)
US CORPORATE PROFITS AFTER TAX (NIPA DATA) AND S&P500 REPORTED EPS
81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 110
90
80
70
60
50
40
30
20
10
1,100
1,100
900
800
700
600
500
400
300
200
100
0
US CORPORATE PROFITS AFTER TAXS&P500 REPORTED EARNINGS (RHS)
(US$bn)
(%)
150
2
3
4
5
6
7
8
9
55 60 65 70 75 80 85 90 95 00 05 10
CORPORATE TAX TAKE AS A % OF GDP
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – financial oppreSSionTreasury Market share not owned by central banks.
Source: Russell Napier, CLSA 30
HINDE GOLD FUND OUTPERFORMANCE(BASED AT 100 ; OCTOBER 2008)
75
100
125
150
175
Oct
-08
Dec
-08
Feb
-09
Apr
-09
Jun-
09
Aug
-09
Oct
-09
Dec
-09
Feb
-10
Apr
-10
Jun-
10
Aug
-10
Oct
-10
Dec
-10
Feb
-11
Apr
-11
Jun-
11
Cumulative Net Overall AlphaCumulative Strategic (Gross)Cumultaive Juniors (Gross)
160
140
120
100
80
60
40
20
0
(20)
(40)2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
NET CENTRAL - BANK PURCHASES OF US TREASURIES AS A % OF ISSUANCE
(%)
FOREIGN CENTRAL BANKS’ SHARE OF TREASURY MARKET HAS PEAKED
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
20
18
22
24
26
28
30
30
34
36
38
40 (%)
SHARE OF TREASURY MARKET NOT OWNED BY CENTRAL BANKS
90
85
80
75
70
65
60
55
501961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2011
(%)
US PAPER COMMERCIAL OUTSTANDING
2007 2008 2009 2010 2011
2,200
2,000
1,800
1,600
1,400
1,200
1,000
800
(US$bn)
US CORPORATE PROFITS AFTER TAX (NIPA DATA) AND S&P500 REPORTED EPS
81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 110
90
80
70
60
50
40
30
20
10
1,100
1,100
900
800
700
600
500
400
300
200
100
0
US CORPORATE PROFITS AFTER TAXS&P500 REPORTED EARNINGS (RHS)
(US$bn)
(%)
150
2
3
4
5
6
7
8
9
55 60 65 70 75 80 85 90 95 00 05 10
CORPORATE TAX TAKE AS A % OF GDP
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – financial oppreSSionUS commercial paper outstanding is falling as government issuance crowds out private sector.
Source: Russell Napier, CLSA31
HINDE GOLD FUND OUTPERFORMANCE(BASED AT 100 ; OCTOBER 2008)
75
100
125
150
175
Oct
-08
Dec
-08
Feb
-09
Apr
-09
Jun-
09
Aug
-09
Oct
-09
Dec
-09
Feb
-10
Apr
-10
Jun-
10
Aug
-10
Oct
-10
Dec
-10
Feb
-11
Apr
-11
Jun-
11
Cumulative Net Overall AlphaCumulative Strategic (Gross)Cumultaive Juniors (Gross)
160
140
120
100
80
60
40
20
0
(20)
(40)2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
NET CENTRAL - BANK PURCHASES OF US TREASURIES AS A % OF ISSUANCE
(%)
FOREIGN CENTRAL BANKS’ SHARE OF TREASURY MARKET HAS PEAKED
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
20
18
22
24
26
28
30
30
34
36
38
40 (%)
SHARE OF TREASURY MARKET NOT OWNED BY CENTRAL BANKS
90
85
80
75
70
65
60
55
501961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2011
(%)
US PAPER COMMERCIAL OUTSTANDING
2007 2008 2009 2010 2011
2,200
2,000
1,800
1,600
1,400
1,200
1,000
800
(US$bn)
US CORPORATE PROFITS AFTER TAX (NIPA DATA) AND S&P500 REPORTED EPS
81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 110
90
80
70
60
50
40
30
20
10
1,100
1,100
900
800
700
600
500
400
300
200
100
0
US CORPORATE PROFITS AFTER TAXS&P500 REPORTED EARNINGS (RHS)
(US$bn)
(%)
150
2
3
4
5
6
7
8
9
55 60 65 70 75 80 85 90 95 00 05 10
CORPORATE TAX TAKE AS A % OF GDP
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – financial oppreSSionCorporate profits too high in US.
Source: Russell Napier, CLSA 32
HINDE GOLD FUND OUTPERFORMANCE(BASED AT 100 ; OCTOBER 2008)
75
100
125
150
175
Oct
-08
Dec
-08
Feb
-09
Apr
-09
Jun-
09
Aug
-09
Oct
-09
Dec
-09
Feb
-10
Apr
-10
Jun-
10
Aug
-10
Oct
-10
Dec
-10
Feb
-11
Apr
-11
Jun-
11
Cumulative Net Overall AlphaCumulative Strategic (Gross)Cumultaive Juniors (Gross)
160
140
120
100
80
60
40
20
0
(20)
(40)2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
NET CENTRAL - BANK PURCHASES OF US TREASURIES AS A % OF ISSUANCE
(%)
FOREIGN CENTRAL BANKS’ SHARE OF TREASURY MARKET HAS PEAKED
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
20
18
22
24
26
28
30
30
34
36
38
40 (%)
SHARE OF TREASURY MARKET NOT OWNED BY CENTRAL BANKS
90
85
80
75
70
65
60
55
501961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2011
(%)
US PAPER COMMERCIAL OUTSTANDING
2007 2008 2009 2010 2011
2,200
2,000
1,800
1,600
1,400
1,200
1,000
800
(US$bn)
US CORPORATE PROFITS AFTER TAX (NIPA DATA) AND S&P500 REPORTED EPS
81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 110
90
80
70
60
50
40
30
20
10
1,100
1,100
900
800
700
600
500
400
300
200
100
0
US CORPORATE PROFITS AFTER TAXS&P500 REPORTED EARNINGS (RHS)
(US$bn)
(%)
150
2
3
4
5
6
7
8
9
55 60 65 70 75 80 85 90 95 00 05 10
CORPORATE TAX TAKE AS A % OF GDP
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – financial oppreSSionCorporate tax rate only going to rise.
Source: Russell Napier, CLSA 33
HINDE GOLD FUND OUTPERFORMANCE(BASED AT 100 ; OCTOBER 2008)
75
100
125
150
175
Oct
-08
Dec
-08
Feb
-09
Apr
-09
Jun-
09
Aug
-09
Oct
-09
Dec
-09
Feb
-10
Apr
-10
Jun-
10
Aug
-10
Oct
-10
Dec
-10
Feb
-11
Apr
-11
Jun-
11
Cumulative Net Overall AlphaCumulative Strategic (Gross)Cumultaive Juniors (Gross)
160
140
120
100
80
60
40
20
0
(20)
(40)2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
NET CENTRAL - BANK PURCHASES OF US TREASURIES AS A % OF ISSUANCE
(%)
FOREIGN CENTRAL BANKS’ SHARE OF TREASURY MARKET HAS PEAKED
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
20
18
22
24
26
28
30
30
34
36
38
40 (%)
SHARE OF TREASURY MARKET NOT OWNED BY CENTRAL BANKS
90
85
80
75
70
65
60
55
501961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2011
(%)
US PAPER COMMERCIAL OUTSTANDING
2007 2008 2009 2010 2011
2,200
2,000
1,800
1,600
1,400
1,200
1,000
800
(US$bn)
US CORPORATE PROFITS AFTER TAX (NIPA DATA) AND S&P500 REPORTED EPS
81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 110
90
80
70
60
50
40
30
20
10
1,100
1,100
900
800
700
600
500
400
300
200
100
0
US CORPORATE PROFITS AFTER TAXS&P500 REPORTED EARNINGS (RHS)
(US$bn)
(%)
150
2
3
4
5
6
7
8
9
55 60 65 70 75 80 85 90 95 00 05 10
CORPORATE TAX TAKE AS A % OF GDP
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – occupy wall StreetA singular misjudgment by protestors?
34
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – internet reforMationAn exponential social paradigm – the World Wide Web.
Source: Ray Kurzweil, 199935
MASS USe oF InVenTIonS
Singularity – govt induced Money aMneSia
Dali’s Disintegration of Memory A metaphor for government induced ‘Money Amnesia’?
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
36
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Singularity – evolution of faceBookFacts & figures: Since 2004
people on FacebookMore than 800 million active usersMore than 50% of our active users log on to Facebook in any given day
Activity on Facebook More than 900 million objects that people interact with (pages, groups, events and community pages) On average, more than 250 million photos are uploaded per day
Global ReachMore than 70 languages available on the site
platformOn average, people on Facebook install apps more than 20 million times every day
MobileMore than 350 million active users currently access Facebook through their mobile devices More than 475 mobile operators globally work to deploy and promote Facebook mobile products
Source: www.website-monitoring.com 37
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – Twitter, and Facebook more widely used in india, indonesia vs any other countries.
38
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – the faceBook revolutionSocial consequences of the evolution of the World Wide Web.
“Money won’t create success, the freedom to make it will.” nelson Mandela
39
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – deMotixA citizen journalism and photo agency website. Co-founded by Jonathan Tepper of Hinde Capital. now in partnership with Corbis, a Bill Gate’s owned company.
A Hindu woman lights lamps on the occasion of diwali and Laxmi Puja. diwali is popularly known as the ‘Festival of Lights’. 40
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – tranSforMational technologySnaptu: ‘A world of free apps on any phone’! Social networking & lifestyle application’s running ‘in the Cloud’.
• Founded August 2007, acquired by Facebook April 2011 for $70m• 42m users, growing at 3.5m per month• Funded by Sequoia Capital (Google, YouTube, Yahoo…)
41
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – exponential adoption rateS
Source: Snaptu marketing presentation 201142
45,000,000
40,000,000
35,000,000
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
JAN
09
MA
R 0
9
MAY
09
JUL
09
SE
P 09
NO
V 0
9
JAN
10
MA
R 1
0
MAY
10
JJU
L 10
SE
P 10
NO
V 1
0
JAN
11
MA
R 1
10
TOTAL SNAPTU UNIQUE USERS
POWER LAW OF PARTICIPATION
COLLABORATIVE INTELLIGENCE
COLLECTIVEINTELLIGENCE
PERIPHERY CORE
HIGH ENGAGEMENT
WITH COMMUNITY
LOW THRESHOLD WITH TOOL
READFAVORITE
TAGCOMMENT
SUBSCRIBESHARENETWORK
WRITEREFACTORCOLLABORATE
MODERATELEAD
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – power law of participationPower Law of Participation. Content created by the few taken up by the many.
43
45,000,000
40,000,000
35,000,000
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
JAN
09
MA
R 0
9
MAY
09
JUL
09
SE
P 09
NO
V 0
9
JAN
10
MA
R 1
0
MAY
10
JJU
L 10
SE
P 10
NO
V 1
0
JAN
11
MA
R 1
10
TOTAL SNAPTU UNIQUE USERS
POWER LAW OF PARTICIPATION
COLLABORATIVE INTELLIGENCE
COLLECTIVEINTELLIGENCE
PERIPHERY CORE
HIGH ENGAGEMENT
WITH COMMUNITY
LOW THRESHOLD WITH TOOL
READFAVORITE
TAGCOMMENT
SUBSCRIBESHARENETWORK
WRITEREFACTORCOLLABORATE
MODERATELEAD
US $ Trillion US $ Trillion
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – exponential aSSet growthGlobal financial assets have risen 17-fold over the last 3 decades from $12.3 trillion to nearly $210 trillion.
Gold has not kept up with this rate of growth, and this doesn’t account for the quadrillion dollars in worldwide derivatives.
Source: World Federation of Exchanges, The Economist, McKinsey, IMF and CPM Group44
Percent Percent
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – gold adoption rateS lowGold investor holdings stands at $2.0 trillion (Nov 2011), 0.96% of Global Financial Assets (GFA). In 2000 gold holdings were worth $227 billion, or 0.2% of GFA, but this isn’t the whole story...
Source: World Federation of Exchanges, The Economist, McKinsey, IMF and CPM Group, as of end of Dec. 201045
Gold investor Holdings = 0.96% of Global Financial Assets (nov 2011)
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – gold adoption rateS low• Today 0.2% would be worth $1.45 trillion ($1800 troy oz. Au) or 0.7% of Global Financial
Assets (GFA).
• Therefore new investment gold only provided 0.26% increase in % gold holdings.
• In 1968 to 1970 % gold holdings of GFA = 5%, to attain this % at current values of gold ($1,800), $10.4 trillion dollars need to be invested.
• $10.4 trillion is equivalent to 5.8 billion troy oz at $1,800 or 1.2 x gold ever produced.
• 5.8 billion troy oz. is 3.6 x known gold reserves (based on US Geological Survey).
• Clearly not only is public ownership miniscule, but to return to the 70s % holdings requires too much gold than these prices can handle.
• This transfer of gold will take place at much higher prices.
46
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
47
Singularity – gold not exponential yetThe US monetary base is backed 15% by gold.
0%
20%
40%
60%
80%
100%
120%
140%
160%
1920 1930 1940 1950 1960 1970 1980 1990 2000 2010$0
$300
$600
$900
$1,200
$1,500
$1,800
$2,100
$2,400
$2,700
Gold Reserves to Money Supply Ratio Low (Gold Undervalued)
Gold Reserves to Money Supply Ratio High (gold Expensive)
Money Supply Doubles
Gol
d R
eser
ves
as P
erce
nt M
oney
Sup
ply
US GoLD ReSeRVeS AnD Money SUppLy
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – gold linear price targetS Gold is re-setting. The minimum target is US$4,000 formulated on 40% base money, which is the non-levered component ie exclusive of credit. This is the linear price target.
48
$10
$100
$1,000
$10,00019
20
1945
1954
1959
1964
1969
1974
1979
1983
1988
1993
1998
2003
2008
100% of Monetary Base = $10,158/oz 40% of Monetary Base = $4,063/ozActual Spot Gold Price = $1,720/oz
Pric
e of
Gol
d ($
oz)
100% Monetary Base 40% Monetary BaseSpot Gold Px
US GoLD ReSeRVeS AnD GoLD pRICe
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – gold exponential price targetSGold is re-setting itself. The confluence of existing exponential global monetary growth, plus the spread of gold information virally via the Web – will lead to rejection of fiat currency.
49
*The underlying methodology is worth emphasizing. Global means the eCB, Fed and the PBOC (China)The implied value of Gold is found by taking the average gold backing 2010/11 times latest gold price and assuming a 40% backingThe gold used as backing of the money supply is equal to the latest holdings of Gold in FX reserves held by the eCB, the Fed and the PBOC (iMF data)
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
4.0%
Jan-99
Jul-99
Jan-00
Jul-00
Jan-01
Jul-01
Jan-02
Jul-02
Jan-03
Jul-03
Jan-04
Jul-04
Jan-05
Jul-05
Jan-06
Jul-06
Jan-07
Jul-07
Jan-08
Jul-08
Jan-09
Jul-09
Jan-10
Jul-10
Jan-11
Jul-11
24,504
63,849
16,336
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
Global M2 Total Credit (US) US M2
GLoBAL Money SUppLy BACKeD By GoLDIMpLIeD GoLD pRICe In USD ASSUMInG 40% BACKInG oF Money SUppLy
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – auSSie gold holdingSif we assume a 40% backing of gold using the gold reserves of Australia, the gold price in USd would be 232,857 USd, but clearly this figure is nonsensical as Australian gold holdings are next to none!
50
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
4.0%
4.5%Nov-84
Nov-85
Nov-86
Nov-87
Nov-88
Nov-89
Nov-90
Nov-91
Nov-92
Nov-93
Nov-94
Nov-95
Nov-96
Nov-97
Nov-98
Nov-99
Nov-00
Nov-01
Nov-02
Nov-03
Nov-04
Nov-05
Nov-06
Nov-07
Nov-08
Nov-09
Nov-10
AUSTRALIAn Money SUppLy (M3) BACKeD By GoLD
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – auSSie gold protectionAussie house prices have increased strongly in AUd terms, but they have fallen in gold terms. in addition, there seems to be a good correlation between declines in house prices (in AUd terms) and the price of gold (in AUd terms).
An investment in gold for an AUd dominated investor with a high exposure to the real estate market is a good hedge.
51
-10%
-5%
0%
5%
10%
Dec
-02
Apr
-03
Aug
-03
Dec
-03
Apr
-04
Aug
-04
Dec
-04
Apr
-05
Aug
-05
Dec
-05
Apr
-06
Aug
-06
Dec
-06
Apr
-07
Aug
-07
Dec
-07
Apr
-08
Aug
-08
Dec
-08
Apr
-09
Aug
-09
Dec
-09
Apr
-10
Aug
-10
Dec
-10
Apr
-11
Aug
-11
-4%
-3%
-2%
-1%
0%
1%
2%
3%
4%
5%
6%
7%
Gold in AUD, QoQ, smoothed Australian House Prices, QoQ (inverse)
45
65
85
105
125
145
165
Dec
-02
Apr
-03
Aug
-03
Dec
-03
Apr
-04
Aug
-04
Dec
-04
Apr
-05
Aug
-05
Dec
-05
Apr
-06
Aug
-06
Dec
-06
Apr
-07
Aug
-07
Dec
-07
Apr
-08
Aug
-08
Dec
-08
Apr
-09
Aug
-09
Dec
-09
Apr
-10
Aug
-10
Dec
-10
Apr
-11
Aug
-11
In AUD In Gold
AUSTRALIA eSTABLISHeD HoUSe pRICe InDeX (2003 - 2004 = 100)
AUSTRALIA eSTABLISHeD HoUSe pRICe InDeX In AUD AnD GoLD (2003 - 2004 = 100)
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – hyper(Bole)Metal criticality?
52
y = 2E-13x4 - 2E-08x3 + 0.0011x2 - 21.005x + 152036
-1,000.0
0.0
1,000.0
2,000.0
3,000.0
4,000.0
5,000.0
6,000.0
7,000.0
De
c-5
8
De
c-6
1
De
c-6
4
De
c-6
7
De
c-7
0
De
c-7
3
De
c-7
6
De
c-7
9
De
c-8
2
De
c-8
5
De
c-8
8
De
c-9
1
De
c-9
4
De
c-9
7
De
c-0
0
De
c-0
3
De
c-0
6
De
c-0
9
De
c-1
2
De
c-1
5
De
c-1
8
De
c-2
1
Gold USD per oz 4th order polynomial forecast
GoLD pRICe In US DoLLAR FITTeD To A poLynoMIAL TRenD
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – critical eventS Silver Criticality – a taste of what is to come?
A mini-parabola in Silver manifested by internet Chatter about Silver shortages. Originated by a few spread by a many.
53
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – hyper(Bole)inflation?High (Hyper) Inflation is a political occurrence.
“ The figures demonstrate clearly that deficits amounting to 40 per cent or more expenditures cannot be maintained. They lead to high inflation and hyperinflations...”
Peter Bernholz “Monetary Regimes & Inflation pp.71”
High (hyper) inflation is caused by financing huge public deficits through money creation.
even 20% deficits were behind but four cases of hyperinflation.
The US government deficit is 10% of GdP, but currently the US deficit is over 30% of all government spending. The world reserve currency is in the red.
54
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – hyperinflationdeficit levels relative to expenditures before hyperinflation.
Source: Monetary Regimes and Inflation, Peter Bernholz55
BUDGET DEFICITS BEFORE FIVE HYPERINFLATIONS
30%
-4 -3 -2 -1 0 1
20%
40%
60%
FRANCE
80%
100%
Years prior to money reform
% o
f Spe
ndin
g m
onet
ised
BOLIVIA
BRAZIL
POLAND
GERMANY
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – Money alive or dead?
56
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity – Monetary Singularity
57
SINGULARITY
LAW OF ACCELERATING RETURNS
LAW OF DIMINISHING RETURNS
FINANCIAL OPPRESSION
INTERNET REFORMATION
TRANSCENDENT MONEY
MONETARY SINGULARITY
All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
Singularity Gold – the secret key to the financial universe.
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All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
hinde capital: inveStMent ManagerSBen Davies (CEO) and Mark Mahaffey (CFO), former colleagues from RBS Greenwich Capital, established Hinde Capital in early 2007, primarily to focus on the precious metals and commodity sector. Hinde Gold Fund, BVI Ltd, was launched in October 2007. The Fund is now into its fourth year.
Ben Davies has over 17 years experience within financial and commodity markets, starting his career in 1994 trading credit fixed-income at Credit Lyonnais. In 1999 Ben moved to Greenwich Capital in London where he traded multi-asset classes. He left Greenwich in 2001 following the merger with RBS and took a position as a portfolio manager for Blue Sky Capital Australia, a Japan equity hedge fund. In 2002 he returned to Greenwich Capital to take up the position as Head of Fixed Income and Macro Proprietary Trading. In 2007 Ben co-founded Hinde Capital with Mark Mahaffey to focus on the precious metals and commodities sectors. Hinde Gold Fund has proven itself to be an exemplary performer in the precious metals sector.
Mark Mahaffey has 26 years experience in the international markets having held senior posts at several leading investment banks. He trained as a fixed income specialist at Daiwa Securities before joining Midland Montagu as Director of the US government trading desk. In 1990 he jointly set up the Greenwich Capital office in London where he managed a portfolio focusing on global macro themes, before joining IBJI in 2001. His most recent appointment from 2005 was Managing Director of Bank of America London Proprietary desk. In 2007 Mark left BoA to set up Hinde Capital.
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All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
hinde capital: key perSonnelJonathan Tepper started his career as generalist equity analyst at SAC Capital in Stamford, Connecticut concentrating on special situations: recapitalizations, spinoffs, and restructurings. After working alongside Mark Mahaffey at Bank of America he has worked at various funds intensifying his research into the resource sector as both a macro and mining analyst. He is a Rhodes Scholar with an M.Litt. in modern history from Oxford University. He graduated with highest honours in history and economics from the University of North Carolina at Chapel Hill in 1998.
Simon White is a University of Cambridge mathematics graduate with a background in interest rate and proprietary trading. After graduation Simon joined JPMorgan on the USD Rates desk, followed by a position at Bank of America as a proprietary trader, where he worked with both Mark Mahaffey and Jonathan Tepper. After a position at a start-up macro hedge fund, he joined Hinde Capital in October 2008.
paul Burton is Managing Director and partner of GFMS World Gold Analyst. Paul was formerly editor of the World Gold Analyst, a position he held for over eleven years. In August 2002, Paul completed a management buyout of World Gold Analyst from the Mining Communications Ltd. Before joining the Mining Journal in 1996, Paul spent over twenty years in various positions within the mining industry. After initially working as a mining engineer he spent much of his career in mineral economics, most notably at Gold Fields, and minerals marketing in South Africa.
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All material is compiled from sources believed to be accurate, but no accuracy can be guaranteed. The presentation is for information purposes only and is not a solicitation to invest. Unauthorized reproduction or distribution is strictly prohibited.
Hinde GOLd FUnd november 2011Singularity – Transcendent MoneyConfidential
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hinde capital: diSclaiMerHinde Gold Fund Ltd is an open-ended multi-class investment company incorporated in the British Virgin Islands.
This document is issued by Hinde Capital Limited, 10 New Street, London EC2M 4TP, which is authorised and regulated by the Financial Services Authority. This document is for information purposes only. In no circumstances should it be used or considered as an offer to sell or a solicitation of any offers to buy the securities mentioned in it. The information in this document has been obtained from sources believed to be reliable, but we do not represent that it is accurate or complete. The information concerning the performance track record is given purely as a matter of information and without legal liability on the part of Hinde Capital. Any decision by an investor to offer to buy any of the securities herein should be made only on the basis of the information contained in the relevant Offering Memorandum. Opinions expressed herein may not necessarily be shared by all employees and are subject to change without notice. The securities mentioned in this document may not be eligible for sale in some states or countries and will not necessarily be suitable for all types of investor. Questions concerning suitability should be referred to a financial adviser. The financial products mentioned in this document can fluctuate in value and may be subject to sudden and large falls that could equal the amount invested. Changes in the rate of exchange may also cause the value of your investment to go up and down. Past performance may not necessarily be repeated and is not a guarantee or projection of future results. The Fund is categorised in the United Kingdom as an unregulated collective investment scheme for the purposes of the Financial Services and Markets Act 2000 and their Shares cannot be marketed in the UK to general public other than in accordance with the provisions of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, the Financial Services and Markets Act 2000 (Promotion of Collective Investment Schemes) (Exemption) Order 2001, as amended, or in compliance with the rules of the Financial Services Authority made pursuant to the FSMA. Participants in this investment are not covered by the rules and regulations made for the protection of investors in the UK. Participants will not have the benefit of the rights designed to protect investors under the Financial Services and Markets Act 2000. In particular, participants will lose the right to claim through the Financial Services Compensation Scheme. The securities referenced in this document have not been registered under the Securities Act of 1933 (the “1933 Act”) or any other securities laws of any other U.S. jurisdiction. Such securities may not be sold or transferred to U.S. persons unless such sale or transfer is registered under the 1933 Act or is exempt from such registration. This information does not constitute tax advice. Investors should consult their own tax advisor or attorney with regard to their tax situation.