Invesco Ltd. Global Investment Solutions

1
Invesco Ltd.Global Investment Solutions
Research

• Presentation byDiane Garnick
• Investment Strategist
• May 2008
• 212-278-9404
• Solutions_at_Invesco.com

2
Status of the US RecessionIf, of course, you
will allow us some leeway

• Weak Dollar
• Likely to remain weak
• Some upside to a weak dollar
• Spending Slowing Down
• Discretionary items hit the hardest
• Could result in net savings
• Earnings Peaked and are Headed Down
• Well beyond the financial sector
• Could be the time to rebuild

3
Feds Reaction to a Weak USD Is this the recipe
for a Liquidity Trap

• Economy is stagnant
• Pessimistic consumers
• Slowing GDP growth
• Real interest rates are close to zero
• Nominal (stated) returns less inflation real
  rates
• Federal Reserve is unable to stimulate the
  economy
• Traditional monetary policy tools dont work
• Solution is a money gift
• Helicopter Ben
• 45.5 million payments totaling 40.8 billion
• 130 million households will get 100 billion by
  July

4
USD Facing a Structural ChangeCurrency of Choice
for 60 Years

• Since the end of World War II
• Not necessarily here to stay
• European Countries finally act in unison
• 3 years to transition, 5 years to strengthen
• Since 2005 Oil prices are up 100 in USD terms,
  only 40 in Euros
• Weak Dollar has slowed down outsourcing

5
US is a Borrow and Spend Economy Wealth Transfer

• Borrow against future earnings
• Unsecured loans, credit cards, etc.
• Fueled growth in discretionary items
• Borrow against homes
• 1 out of every 517 homes is in some stage of
  default
• Negative home equity scenario
• Borrow against 401K/retirement savings
• Focal point is on the baby boomers
• Save Now or Die Trying, Mark Bruno

6
SP 500 Earnings 450 companies already reported
Projected 1Q/2008 Sector Index Weight
Earnings Weight 1Q/2008 Growth Rate Consumer
Discretionary 8.6 7.4 -21.2 Consumer Staples
10.4 9.7 13.4 Energy 14.3 18.9
30.3 Financials 16.7 11.9
-83.1 Health Care 11.3 13.3
5.1 Industrials 11.8 12.7
9.9 Information Technology 16.3 14.2
10.7 Materials 3.7 3.8
6.7 Telecommunication Services 3.4 4.2
1.8 Utilities 3.6 3.9 8.2 SP 500
-17.4 SP 500 Ex Fin 3.9 Source Credit
Suisse Quantitative Research, IBES
7
Building Permits as a Leading Indicator Bleak
data behind us??

• Housing starts in April increased 8.2
• Seasonally adjusted annual rate of 1.03 million
  units
• Households and Companies will look to re-tool
  re-build
• Macro economic data is finally becoming
  moderately positive
• Investors are rewarded for committing capital
  during times like these

1991
8
Peers are selecting Invesco productsAt 500
Billion under management, were working with
most asset owners

• One focus Asset Management
• No transition management, custody, lending, etc.
• We strive to identify, capture, and deliver alpha
  PERIOD.
• Commitment to solution driven long term
  relationships
• Shifted from a manufacturing model to a service
  model
• Radio to iPod example
• Depth and breadth of products
• Allow us to help identify and solve problems
• Eventually well find a good fit for both of us!
  
• Passionate about overcoming educational hurdles
• Trustee educational seminars
• Informational symposiums with independent
  experts
• Federal Reserve speaking about risk management
• Harvard University speaking about fee structure

Assets under management are as of December
31, 2007
9
Global Investment Solutions ResearchSolutions_at_I
nvesco.com
Investment solutions across all major asset
classes equity, fixed-income and alternatives
Not all of the INVESCO strategies listed are
available in the U.S., nor are they available on
all platforms. Please consult with your Invesco
representative for more information on any of our
strategies mentioned.
10
Disclaimer

• All material presented is compiled from sources
  believed to be reliable and current, but accuracy
  cannot be guaranteed.  This is not to be
  construed as an offer to buy or sell any
  financial instruments and should not be relied
  upon as the sole factor in an investment making
  decision.  As with all investments there are
  associated inherent risks.  Please obtain and
  review all financial material carefully before
  investing.  This does not constitute a
  recommendation of the suitability of any
  investment strategy for a particular investor. 
  The opinions expressed herein are based on
  current market conditions and are subject to
  change without notice.