PRECIOUS METALS,DIAMONDS & GEMSTONESINVESTMENT SUMMIT

THE LONDON CHAMBER OF COMMERCE AND INDUSTRY ● THURSDAY, 20 MAY 2010www.ObjectiveCapitalConferences.com

11.25 - 11.50The impact of turbulence in the financial markets on the euro, dollar and goldMarino Pieterse – Editor, Goldletter International

2

The impact of turbulence on the financial markets on the euro, dollar and gold

Marino G. Pietersepublisher Goldletter International

Objective Capital’s

Precious Metals, Diamonds and Gemstones Investment Summit

London, United Kingdom

May 20, 2010

Goldletter II NN TT EE RR NN AA TT II OO NN AA LLthe in terna tiona l independent in formation and advice bu lle t in for gold and rela ted inves tments

3

May 15 April 30 Year-end Year-to-date Year-end Year-to-year June 302010 2010 2009 2010/09 2008 2009/08 2008

(in %) (in %)Gold 1,239 1,179 1,104 12 865.00 28 932.75Silver 19.29 18.64 16.99 14 10.79 57 17.65Platinum 1,721 1,738 1,475 17 912 62 2069Palladium 536 552 407 32 185 120 472

Copper 6,960 7,430 7,346 -5 2,902 153 8,775Nickel 22,200 25,800 18,480 20 10,810 71 21,675Lead 1,952 2,176 2,395 -18 949 152 1,735Zinc 2,050 2,276 2,570 -20 1,121 129 1,875

Brent oil 76.52 85.88 77.20 -1 41.76 85 139.30

historic high: $ 147.00 (July 7, 2008) low : $ 39.23 (December 5, 2008)

Uranium (U3O8) spot price 41.50 41.75 44.50 -7 53.00 -16 59.00April 6, 2009 (Low ) 59.00 40.00Long-term contract price 60.00

source: Goldletter International

Overview metal / oil prices (in US$)

4

London trading Change Period ofin US$ in % change

December 1, 2003 400.00 December 2, 2005 500.00 +25 (2 years)April 14, 2006 600.00 +20 ( 3 ½ months)May 10, 2006 700.00 +17 (- 1 month)May 12, 2006 725.25 +20 (- 1 month)October 6, 2006 560.75 -23 (5 months)

►Year-end 2006 635.75 +14 (3 months)April 20, 2007 691.40 +9 (4 months)June 27, 2007 642.10 -7 (2 months)September 18, 2007 714.75 +12 (2 ½ months)

►Year end 2007 836.50 +17 (3 ½ months)March 17, 2008 (H) 1,030.80 +24 (2 ½ months)May 1, 2008 853.00 -16 (1 ½ months)July 16, 2008 977.50 +15 (2 ½ months)September 11, 2008 740.75 -24 (2 months)October 10, 2008 918.00 +24 (1 month)October 24, 2008 (L) 692.50 -25 (2 weeks)

►Year end 2008 865.00 +25 (2 months)February 20, 2009 (H) 989.00 +14 (-2 months)(Interim high New York $ 1,006.30)April 20, 2009 870.00 -12 (2 months)June 1, 2009 987.00 +13 (-1½ month)July 13, 2009 908.50 -8 (+1½ month)September 17, 2009 1,020.50 +12 (2 months)September 30, 2009 995.75 -2 (½ month)December 3, 2009 (H) 1,226.10 +23 (2 months)

►Year end 2009 1,104.00 -10 (1 month)January 29, 2010 1,078.50 -3 (1 month)April 30, 2010 1,179.25 +9 (3 months)May 15, 2010 (H) 1,248.95 +14 (3½ months)

source: Goldletter International

Measuring the new gold bull market

5

Gold does not run its own course as a safe havenGold ($) €/$ Brent Oil Gold/Oil

$/barrel ratioYear-end 2001 276.50 0.88 19.80 14.0Year-end 2002 342.75 1.05 28.13 12.2Year-end 2003 417.25 1.26 30.17 13.8Year-end 2004 438.00 1.36 40.25 10.9Year-end 2005 513.00 1.18 58.87 8.7May 12, 2006 1) 725.75 1.29 68.05 10.7October 6, 2006 2) 560.75 1.27 58.86 9.5

► Year-end 2006 635.70 1.32 60.14 10.6June 30, 2007 650.50 1.35 72.82 8.9September 18, 2007 3) 714.75 1.39 77.58 9.2

► Year-end 2007 836.50 1.47 93.89 8.9March 17, 2008 (High) 1,030.80 1.58 102.82 10.0April 30, 2008 4) 853.00 1.55 109.78 7.8June 30, 2008 930.25 1.58 139.30 6.7July 9, 2008 5) 927.50 1.57 141.70 6.5July 16, 2008 977.50 1.58 134.54 7.3September 15, 2008 775.00 1.43 90.38 8.6October 8, 2008 6) 903.50 1.37 83.18 10.9October 24, 2008 (Low) 692.50 1.26 60.41 11.5November 24, 2008 822.50 1.28 52.19 15.8December 5, 2008 7) 749.00 1.27 39.23 19.1December 16, 2008 8) 838.25 1.37 44.11 19.0

► Year-end 2008 865.00 1.40 41.76 20.7January 15, 2009 9) 810.00 1.31 44.50 18.2March 5, 2009 10) 913.00 1.26 44.16 20.7April 2, 2009 11) 897.75 1.34 53.14 16.9May 13, 2009 12) 924.00 1.36 57.26 16.1May 31, 2009 975.50 1.41 64.70 15.1June 30, 2009 934.50 1.41 68.21 13.7September 17, 2009 1,020.50 1.47 70.52 14.5September 30, 2009 995.75 1.46 67.72 14.7December 3, 2009 (High) 1,226.10 1.51 77.56 15.7

► Year-end 2009 1,104.00 1.43 77.20 14.3January 29, 2010 1,078.50 1.40 70.56 15.3March 31, 2010 1,115.50 1.35 81.23 13.8April 30, 2010 1,179.25 1.33 85.88 13.7May 10, 2010 13) 1,196.50 1.28 80.04 15.0May 14, 2010 1,248.95 1.24 76.52 16.3

1) 2006 high of gold price2) 2006 second half low of gold price after correction oil price3) Fed funds rate lowered for the first time (0.50% to 4.75%)4) Fed funds rate lowered (0.25% to 2.00%)5) ECB rate lowered (0.25% to 4.25%)6) Fed funds and ECB rates lowered 0.50% to 1.50% and 3.75%, respectively7) 2008 low of oil price8) Fed funds rate lowered (0.75-1.00% to 0.00-0.25%)9) ECB rate lowered 0.50% to 2.00%

10) ECB rate lowered 0.50% to 1.50% 11) ECB rate lowered 0.25% to 1.25%12) ECB rate lowered 0.25% to 1.00%13) Euro salvation package

6

euro/dollar gold price

Year-end 2007 1.47 836.50March 17, 2008 1.58 1,030.80 2008 highJune 30, 2008 1.58 930.20September 15, 2008 1.46 996.00October 24, 2008 1.26 692.50 2008 lowDecember 16, 2008 * 1.37 838.25Year-end 2008 1.40 865.00February 27, 2009 1.26 952.00June 30, 2009 1.41 934.50May 13, 2009 ** 1.36 924.00December 3, 2009 1.51 1,226.10 2009 highYear-end 2009 1.43 1,104.00March 31, 2010 1.35 1,115.50April 30, 2010 1.33 1,179.25May 14, 2010 1.24 1,248.95 2010 high

* Fed funds rate lowered 0.75%-1.00% to 0.00-0.25% (ECB 2.50%)** ECB rate lowered 0.25% to 1.00%

source: Goldletter International

The crisis resistance of the dollarcompared to gold price

Gold correlated to euro

May 14 Year-end 2009 Change in %

Euro / dollar 1.24 1.43 -13Gold 1,249 (H) 1,104 +13

7

1 US$ =

Euro Jap. Yen RMB Rupee Cdn$ A$ SA Rand(00) (00)

Year-end 2007 0.68 112 7.31 39.43 0.98 1.14 6.85June 30, 2008 0.63 106 6.87 42.85 1.01 1.04 7.96September 30, 2008 0.69 106 6.86 47.35 1.04 1.22 8.20Year-end 2008 0.71 90 6.85 49.72 1.22 1.45 9.46March 31, 2009 0.76 97 6.85 52.17 1.25 1.46 9.72June 30, 2009 0.71 96 6.84 48.64 1.16 1.24 7.88September 30, 2009 0.68 90 6.84 48.34 1.09 1.15 7.43

Year-end 2009 0.69 92 6.82 46.75 1.05 1.10 7.40March 31, 2010 0.74 93 6.82 45.00 1.02 1.09 7.37May 14, 2010 0.79 93 6.82 45.02 1.02 1.11 7.46

THE COURSE OF THE DOLLAR AGAINST OTHER CURRENCIES

Euro Jap. Yen RMB Rupee Cdn$ A$ SA Rand

Change against dollar -14 -1 - +4 +3 -1 -12010 to date (in %)

8

Related to currency basket of the US dollar index(57.6% in euro’s, 13.6% in Japanese yen, 11.9% in British pounds, 9.1% in Canadian dollars, 4.2% in Swedish crones and 3.6% in Swiss francs).

Since the index went up in 1995 from a long termresistance level of 80 to a high of 120 in 2001, at the time the euro was introduced, it dropped to a low of 72 in March 2008, but has been followed by a strong upward correction to $ 87 well above the historic resistance level. After a new correction to 74early December 2009, the current level is 84/85.

1950 1965

11 Central Bank gold holdings 26,300 31,900 20,073 *(in tonnes)

Value of gold reserves 29.5 33.4 696 **(US$ billion)

Value of non-gold reserves 34.0 45.8 1,218 (US$ billion)

Gold in % of total reserves 84% 73% 36%

* 19 signatories to the second Central Bank Gold Agreement 3 (September 2009 - 2014) including European Central Bank + United States** based on gold price of US$ 1,040 per ounce

December 2009

Western Central Bank gold holdings compared to non-gold monetary reserves

9

10

World official gold holdings and total monetary reserves

December 2009 Gold reserves Total Gold astonnes reserves % total

(bln $) monetaryreserves *

United States 8,134 394 69Germany 3,408 175 65France 2,445 128 64Italy 2,452 130 63Switzerland 1,040 120 29Netherlands 613 39 52Portugal 383 15 84United Kingdom 310 69 15Spain 282 27 35Austria 280 18 53Sub-total 19,347 1,115

All countries 26,780 8,779 10.2

World (incl.institutes) 30,117

Euro (incl.ECB) 10,799 1,808 55.7ECB 501 85 19.7

IMF 3,005 BIS 120

* based on gold price of $ 1.040 per troy ounce

Western countries

Source: IMF/World Gold Council/Goldletter International

December 2009 Gold reserves Total Gold astonnes reserves % total

(bln $) monetaryreserves

China 1,054 2400 1.5Japan 765 1065 2.4Korea 14 234 0.2Singapore 127 185 2.3Taiwan 424 346 4.1India 558 291 6.4

Total 2,942 4,521

Asia

December 2009 Gold reserves Monetary Gold as tonnes reserves % total

(bln $) monetaryreserves

Russia 608 404 4.7Venezuela 356 33 35.7Lebanon 287 36 26.5Libya 144 104 4.6Saudi Arabia 143 47 10.2South Africa 125 40 10.5Australia 80 44 6.0

Total 1,743 708

Other countries

11

World Gold Supply and Demand (in tonnes)SUPPLY 2009 2008 Year-to-year 2007

change in %

Mine production 2,554 2,409 6 2,476Official sector sales 44 236 -81 484Recycled gold 1,549 1,217 27 956

Total supply 4,147 3,862 7 3,916

DEMAND

Jewellery 1,747 2,186 -20 2,405Industrial & Dental 368 436 -16 462Total Fabrication 2,115 2,622 2,867

Net producer de-hedging 257 363 444

Net retail investment 676 863 -22 433ETF's similar products 595 321 85 253Inferred Investments 504 -293 - -81Total investment 1,775 891 605

Total demand 4,147 3,876 7 3,916

Gold price (London PM, US$/oz 972 872 695

source: GFMS

12

2009 2008 2007 2009 2008 2007 2009 2008 2007

India 406 502 552 74 211 218 480 713 769China 347 327 302 81 66 26 428 393 328Middle-East 232 318 325 19 28 20 251 346 346USA 150 188 258 113 79 17 263 267 275Turkey 75 153 188 32 57 61 107 210 249Vietnam 15 20 21 58 96 56 73 116 78Japan 24 28 31 -10 -39 -56 14 -11 -26Other 498 651 724 309 364 68 807 1015 792

World total 1,747 2,187 2,401 676 862 410 2,423 3,049 2,811

source: GFMS

jewellery net retail total

Demand in major consumer countries (in tonnes)

India: Over the year 2007 tonnage off-take totalled 480 tonnes down 33% from 713 tonnes in 2008 (-233 tonnes). Nevertheless held onto its position as the world's largest consuming nation.

► jewellery demand totalled 406 tonnes, down 19% on 502 tonnes in 2008, the weakest result sinde 1995► investment demand 74 tonnes, a 65% decline on 211 tonnes in 2008

China: 22% increase in invstment demand and 6% increase in jewellery demand, translates to an increase in total consumer demand of 9% (+35 tonnes) over 2008.

13

World Gold Mine Production (10-year comparison – in tonnes)

2008 1999

Asia 556 457Latin America 486 381Africa 484 661North America (US, Canada) 331 500CIS region * 313 263Australia 215 300Other Oceania 15 16Europe 15 24

Total 2415 2603

* East European countries (Russia) Central Asian countries (Uzbekistan)

(Kazakhstan)(Kyrgyzstan)(Tajiskistan)

source: GFMS

Gold production by continent

14

Shift in gold production from traditional to emerging countries

► China has surpassed South Africa as the worlds premier gold producer in 2007

Production in tonnes Production in tonnes2008 1999 2008 1999

Traditional countries Emerging countries

United States 235 342 China 292 163South Africa 233 477 Peru 180 129Australia 215 300 Russia 189 138Canada 96 158 Indonesia * 95 151

____ ______ _____ _____Total 779 1276 Total 755 581

Total world production 2416 2603

% total world production 32 49 31 22

* in 2008 output of Grasberg (Freeport McMoran) contracted by 45 tonnessource: GFMS

15

Country Company Reserves Mine life2010 E 2009 2008 2007 Year end 2008 Reserves

(in years)

South-Africa AngloGold Ashanti 4.6 4.60 4.60 5.48 71.4 16Gold Fields * 3.4 3.40 3.64 3.97 81.0 24Harmony * 1.6 1.46 1.60 1.75 48.2 30

US Newmont Mining 5.3 - 5.5 5.26 5.18 5.32 91.8 17Freeport-McMoran 1) 2.6 - 2.7 2.66 1.31 2.30 37.2 14

Canada BarrickGold 7.6 - 8.0 7.42 7.66 8.06 139.8 19Goldcorp 2.6 2.42 2.32 2.29 48.8 19Kinross Gold 2.2 2.24 1.84 1.59 51.0 23

Australia Newcrest Mining * 1.7 1.63 1.78 1.78 42.8 25

China Zijin Mining 2.7 2.42 1.84 1.68 17.3 16

Peru Minas Buenaventura 1.2 1.32 1.21 1.09 11.2 12

Papua New Guinea Lihir Gold 1.2 1.12 0.77 0.70 28.8 24

* per 30/6/09 1) leading market positions in copper and molybdenum

source: Goldletter International

(in million ounces)

Production

Annual gold output and reserves of the world's Top-12 gold producers

16

WORLD TOP-20 LISTED GOLD PRODUCERS (March 31, 2010)

Traditional countries (12): Market capitalization In % totalin US$ billion

Canada (5) 90 41South Africa (4) 33 12United States (2) x 31 12Australia (1) 15 7

____ ____Sub-total 169 72

Emerging countries (8):

Russia (3) 17China (1) 11Peru (1) 8Brazil (1) 7Papua New Guinea (1) 7Ghana (1) 5

____ ___Sub-total 55 25

Total 224 100

x including $ 6 billion applying to 17% sare of gold Freeport McMoran

17

March 31, 2010 Trading Change High Low Net sharessymbol Year end in % issued local currency US$ billion

Current 2009 (billion)

Canada (5) Toronto Stock Exchange – in Cdn$ Cdn$Barrick Gold ABX 38.97 41.46 -6 50.53 33.01 984.4 38.4 37.6Goldcorp G 37.95 41.35 -8 48.37 32.39 733.8 27.8 27.3Agnico-Eagle Mines AEM 56.47 56.92 -1 77.32 50.80 156.7 8.8 8.7IAM Gold IMG 13.50 16.51 -18 21.95 8.94 370.5 5.0 4.9Kinross K 17.37 19.37 -10 25.22 16.52 696.6 12.1 11.9Subtotal 90.4

South Africa (4) JSE – in Rand RandAngloGold Ashanti ANG 277.95 306.29 -9 359.00 259.50 362.3 100.7 13.6Harmony Gold HAR 68.80 75.79 -9 109.00 67.71 426.2 29.3 4.0Gold Fields GFI 92.20 97.98 -6 116.46 83.10 705.4 65.0 8.8

LSE - in £ £Randgold Resources RRS 50.15 50.00 0 54.50 27.60 90.2 4.5 6.8Subtotal 33.2

USA (2) NYSE – in US$Newmont Mining NEM 50.93 48.93 4 56.45 36.77 483.0 24.6Freeport McMoran * FCX 83.54 80.29 4 90.55 43.19 432.6 36.1Subtotal 60.7

Australia (1) ASX Sydney – in A$ A$ Newcrest Mining NCM 32.82 35.33 -7 39.75 27.64 483.4 15.9 14.6Subtotal 14.6

* one of the world's major copper producers; approximately 17% of income applies to gold

Market valuation of the world's top-20 listed gold producers

12 monthMarket capitalizationShare price

►Traditional countries:

18

Russia (3)Polyus Gold OPYGY 25.75 27.55 -7 32.4 17.27 381.3 9.8Polymetal PMTL 10.70 9.4 14 10.80 6.00 399.4 4.3Petropavlovsk PPLKY 35.50 33.05 7 44.00 13.10 91 3.2Subtotal 17.3

China (1) Hong Kong (H shares) – in HK$ HK$Zijin Mining ** 2899 6.12 7.42 -18 9.33 5.07 14,541.3 89.0 11.5Subtotal 89.0 11.5

Peru (1) NYSE - in US$Minas Buenaventura BVN 30.85 33.47 -8 42.50 19.00 274.9 8.5Subtotal 8.5

Brasil (1)Yamana Gold AUY 9.85 11.23 -12 14.37 7.36 733.4 7.2Subtotal 7.2

Papua New Guinea (1) Lihir Gold LGL 3.03 3.28 -8 3.77 2.41 2368.7 7.2 6.6Subtotal 7.2 6.6

Ghana (1) Red Back Mining RBI 20.75 15.00 38 22.13 6.53 232.1 4.8 4.7Subtotal 4.7

Total 254.7

* also major copper producer** integrated mining company; 10,535.9 million domestic A-shares + 4,005.4 million H-shares

►Emerging countries:

Market valuation of the world's top-20 listed gold producers

19

Current 2009 2008 2007 2006

Gold price 1,200 972 896 667 628Cash costs 500 480 458 389 307

____ ____ ___ ___ ___Margin 700 492 438 278 321

in % 58 51 49 42 51

LEVERAGE IN GOLD PRICE

20

► Credibility crisis → Global stock markets crunch → Real economy losses

(in US$ billion)Capital infusions and loan guarantees 1,400of which:United States 1,000Eurozone 240Japan 105

Global financial crisis 2008/2009 in perspective (in US$ billion)

► Prime mortgage crisis (from early 2007) 500

► Financial crisis / Credit crunch (from September 15, 2008 fall Lehman Brothers) 1,000

Global Financial Stability Report (IMF):Rescue package United States $ 700 billion

Europe $ 300 billion

► Write-offs in bank sector : 60% American banks - 40% European banks 580_____

Total 2,080

21

► IMF initially estimates total financial sector losses of $ 4,100 billion

US $ 2,700 billionEurope $ 1,200 billionJapan $ 149 billion

► as per October 1, 2009, IMF reduces estimated losses to $ 3,400 billion

Stimulous packages : US$ billion

United States 787consumer and small business loans (TALF) up to $ 1,000 billionFed plan to buy $ 300 billion of US government debt

China 586Japan 162G-20- / IMF 1,000

_____Total 2,535

22

Worldwide stock market losses

Valuation year-end 2007 61,000losses in week of October 3-10, 2008 6,200Losses full year 2008 -42% (MSCI-index) 25,000Valuation year-end 2008 36,000

January/February 2009 6,500

March 2009 recovery +3,000April 2009 recovery +1,100

23

History of financial crisisDow Jones

►1973 - 1974: Oil Crash (2 year) - 40%

► October 19, 1987 Black Monday - 22% October 3 week fall - 34%

(blamed on the rise of computerized hedging strategies)

► 1997 - 1998 : Asian crisis

October 1997 - 11%(Russian debt default 1998)

Asian growth of financial wealth US$ billion

► 2002 - 2009 growth monetary reserves China 2,200

► Sovereign Wealth Funds 2,500

24

Correlation between GDP – representing real economy –and Market Capitalization

Expected GDP growth Changein %

2007 2008 2009* 2009 2010 2007 2008

United States 13,808 14,265 13,380 -2.7 +1.5 19,964 11,605 -41

Euro zone 12,182 12,267 11,752 -4.2 +0.3 9,993 4,766 -52

Japan 4,382 4,924 4,658 -5.4 +1.7 4,543 3,263 -28

China 3,280 4,402 * 4,776 +8.5 +9.0 4,479 1,759 -61

* corrected data including consumer spending

in US$ billion - year-endin %GPD in US$ billion Market capitalization

2009 GDP Market Capitalization(US$ billion year-end 2009 (US$ billion) in % in US$billion

Greece 331 32 -24 26Spain 1,464 1,435 -22 259Italy 2,118 656 -15 82

2010 Loss

25

26

27

28

European bank debts and corporate debentures

in € billion Applying to:

Greece 302.6 UK 12.3Portugal 10.3Spain 1.2

Ireland 938.6 UK 193.0Portugal 21.8Spain 15.8

Portugal 286.7 Spain 88.5UK 25.5

Spain 1,153.9 UK 119.5Portugal 28.9

Total 2,681.8 of which:UK 350.3Spain 105.5Portugal 61.0

29

P.O.Box 76988

1070 KG Amsterdam

the Netherlands

Telephone 0031 20 470 0249

Fax number 0031 20 675 1354

www.goldletterint.com

info@goldletterint.com

Goldletter II NN TT EE RR NN AA TT II OO NN AA LLthe in terna tiona l independent in formation and advice bu lle t in for gold and rela ted inves tments