J.P. Morgan

J.P. Morgan Global Asset Allocation 21 September 2012 • The J.P. Morgan View Weak economy vs. strong liquidity. Who wins? • Asset allocation — Strong liquidity, heavy supply of safe assets, high risk premia, defensive positioning by end investors, and a QE focus on reducing downside risk are not technicals but are true fundamental drivers of the risk rally that trump weak economic growth, in our view. Economics — Q3 global growth remains as soft as Q2, confirming bottoming process, but not yet a rebound. Only rising order/inventory ratios and rallying markets hint at rebound into Q4, we believe. We nudge up 2013 Euro area growth from 0.2% to 0.3% on improved financial conditions. Global Asset Allocation n AC JPK4organ Chase Bank NA John Normand J.P. Morgan Securities plc Fixed Income —Position on wider swap spreads in Treasuries, Bunds and UK. Nikolaos Pan' irtzoglou • Equities — Stay long value stocks in Europe, commodity sectors globally, US- housing-sensitive sectors within the US, and US against EM. J.P. Morgan Secunties plc Credit — Stay long credit spreads across the US HY and EM sovereigns and corporates and we expect further spread compression. Seamus Mac Gorain Currencies — New FX forecasts, with weaker dollar into year-end. J.P. Morgan Securities plc Matthew Lehmann Commodities — We think agriculture prices have peaked and will move lower from here. Open a short in the GSCI agriculture index. Markets took a breather this week, after last week's fireworks, with equities and credit largely flat, and bonds yields and commodities down. It was a quiet week for data, but what we got was on the softer side. We continue to think global growth is bottoming, but the evidence so far confirms only that growth has come down and that Q3 seems equally soft as Q2. There seems no real J.P. Morgan Securities plc Leo Evans J.P. Morgan Securities plc evidence yet of a rebound in growth. All we have is a rise in orders relative to YTD returns through Sep 20 inventories in flash PMIs, a rise in confidence, & surging financial asset prices. 14, equities are in lighter color. SSP500 • The weak economic data of the past two years and rising asset prices have created a conundrum to investors on what they should really follow -- the weak fundamentals or the good "technicals"? We have argued here frequently that MSCI ACWorld' EMBIG I I liquidity driven asset reflation in a market with high risk premia and defensive positions trumps weak economic growth, as long as the latter does not deteriorate into recession. Hence, we have chosen to remain long risk assets despite repeated downgrades to economic growth projections. We like to make clear though, that these so-called technicals are to us very fundamental and am not as short term in nature as many would suspect. And this for three reasons. EMS Corp. MSCI Europe' US High Yield Gold MSCIEM' US HighGrade &rope Faced Inc' • For one, the relative supply and demand for financial assets is not a mere short-term technical but is based on the first fundamental law of economics, which is that of supply and demand. Government supply of government debt EM FX EM Local Bonds" and cash is many times the supply (net issuance) of corporate debt and equities. Topix' Hence the latter, scarcer corporate securities should rise in price against the US Fixed Income much more abundant supply of government liabilities (high-powered money and government debt). This force is not a short-term technical impact, but in fact works mare slowly and profoundly. Global Gov Bonds" GSCI TR US cash ■ .5 5 I IS 20 Source: M. Morgan, Bloomberg. See blue See page 7 for analyst certification and important disclosures. box on page 2 (or description. EFTA01181258 Jen Loeys t-2121834-5874 Global Asset Allocation The J.P. Morgan View 21 September 2012 • Second, credit and equities are characterized by much higher risk premia versus government debt than we typically see in this point of the cycle. Central banks are now acting not merely to increase the supply of cash, but are also casting their policy in term of providing downside risk protection (insurance). We would classify the ECB's OMTs as exactly that. They will be implemented only if needed and with an explicit objective to eliminate risk premia on sovereign EMU debt. The Fed's new QE3 similarly is conditional on the state of the economy and labor market and will be accelerated if the economy weakens. If only US and Euro fiscal authorities could similarly reduce downside risk, risk premia would surely come crashing down. Risk premia are thus fundamental and not merely technical. • Third, it is frequently argued that markets are running ahead of still weak fundamentals (growth) and are thus wrong. We would argue that the transmission process of monetary policy in a world of zero interest rates runs exactly from markets to growth. It is through asset reflation that central banks try to stimulate growth. Hence market will lead economies. Don't fight a determined Fed, ECB, BOJ and BoE, especially not when they work together. • To be clear, we are not telling you to ignore economic growth. Stronger growth would have given us higher equity prices. But at this point in the cycle (we assume we are mid-cycle), volatility of economic data is trumped by relative supply & demand & changing risk perceptions, as long as we do not have another recession. Growth, however, does have an impact on relative country and sector performance. The top chart shows how growth forecasts for 2012 have been stable in DM, but have trended down in EM over the past 6 mths, which likely explains why EM equities have underperformed. The 2nd chart shows how cyclical stocks have not kept up with their high-beta nature over the past 2 years, underperforming defensives, despite an overall rally in stocks, likely as cyclicals are more vulnerable to downgrades in growth. Fixed income • Yields edged lower on weaker data. Spain's largest bond auction since January provides more evidence of the impact of the ECB's backstop, although it remains unclear when the backstop will be activated. The Bank of Japan joined its counterparts in announcing further bond purchases, but with the focus remaining on bills and short-dated bonds, the impact is likely to be limited, and we are in fact modestly bearish on duration in Japan. • G-4 central banks are slated to buy nearly 'trillion net of bonds over the next year, half of that due to the Fed's MBS purchases. Together, FX reverse managers and G-4 central banks already own an estimated $11trillion of bonds, equivalent to over one third of global bonds rated AA and above, or more than half of those rated AAA, following a steady upward trend in recent years (see Chart, and today's Flows and Liquidity). By hoovering up most of the net issuance of safer bonds, the official sector appears to be continuing to push investors into riskier or less liquid alternatives. • We are not strongly positioned on duration, even as we expect higher US Treasury yields over the balance of the year. We remain positioned for narrower intra-EMU spreads, consistent with a broader view that credit and liquidity spreads are a more attractive source of carry than extending duration. We do, however, look for the sharp narrowing in swap spreads across markets, driven in part by heavy swapped issuance, to reverse course, and hold spread wideners (long govies vs swaps) in USTs, Bunds, and UK gilts. J.P.Morgan 2012 EM vs. DM consensus GDP growth forecasts 6.5 2.9 2.6 6.0 ti 2.3 EM 2.0 5.5 R E 1.7 1.4 5.0 1.1 0.8 4.5 0.5 Ja •11 Jul-11 Jan-12 Jul-12 Source: J.P. lAugan. Consensus Economics. Consensus Economics forecasts are for regcm and countres mat we swaged using the same S-year roam USD GOP weights that we use br our cmn ebb& growth forecast. Global cyclical vs. defensive equities vs. global equities Datastream total return Indices. 310 290 270 250 230 210 190 170 Jan-10 Aug-10 Mar-11 Source: 0ataweam. J.P. Morgan Oct-11 May-12 130 125 120 115 110 105 100 95 Moro details in... Global Data Watch. Bruce Kasman and David Hensley Global Markers Outlook and Strategy. Jan Loeys. Bruce Kasman. et al. US Fixed Income Markers. Terry Belton and Srini Ramaswamy Global Fixed Income Markets. Pavan Wadhwa and Fabio Bassi Emerging Markets Outlook and Strategy. Joyce Chang Key trades and risk: Emerging Market Equity Strategy. Adrian Mowat et al. Flows and liquidity, Nikos Paniginzoglou et al. Description of YTD Chart on front page: Returns in USD. *Local currency. "Hedged into USD. Euro Fixed Income is iBoxx Overall Index. US HG. HY. EMBIG and EMS Corp are JPM indices. EM FX is ELM'. in S. 2 EFTA01181259 Jan Loeys f1-2121834-5874 Global Asset Allocation The J.P. Morgan View 21 September 2012 Equities • Equity markets paused this week following two weeks of strong gains of almost 5% for MSCI AC World in the first two weeks September. We find no reason to change our stance. We stay tactically long equities and we favor value stocks in Europe, commodity sectors globally, US-housing-sensitive sectors within the US, and US against EM equities regionally. • Market gyrations have been a permanent feature of the market environment over the past few years. But despite this year's crisis or "soft patch", equities have delivered double digit returns outperforming other asset classes. In our opinion, this justifies a focus on the long term. Our quarterly publication "Trade opportunities for long term investors, Sep 1r does exactly this. It looks beyond short-term gyrations and focuses on long-term trading themes. • Our recommendation for the long term is to focus on monetizing extremities in yield gaps and risk premia, e.g., the multi-decade-high yield gap between equities and bonds and risk premia such as correlation and skew risk premia. Our equity specific trades are shown below: • Buy high dividend yield US equities vs. l0y USTs • Buy 2013 FTSE 100 dividend futures for defensive growth • Stay short S&P 500 long-dated skew • Stay short S&P500 correlation • Stay short Nikkei convexity • Stay OW European SMid vs US SMid • Buy MSCI EM$ vs. MSCI Worlds • Long Dax vs. EuroStoxx50 Credit • This week was mixed for credit. US HG spreads continued to come in and are now at their lowest level for over a year and US CMBS also rallied further. However, HG spreads in Europe and US HY spreads both widened a little along with EM sovereign and corporate spreads. Some profit taking is not surprising given the almost straight line rally we have seen across spread products over the last few months but we think a big correction is unlikely. In our view, credit remains the most attractive asset from a carry-to-risk perspective and QE is pushing fixed income investors out of low yielding government debt, leaving little choice but to move out further and further along the risk spectrum. • This week saw a record weekly inflow into European HY funds (European High Yield Fund Flows: Weeki), Update, Daniel Lamy et al., 21 Sep) Our European credit strategists believe investor positioning in European HY is still light and supports further spread compression. They also see value in Spanish covered bonds, where there could be significant positive event risk from Spanish bank recapitalization announcements in the next few weeks. Foreign Exchange • We published our monthly Key Currency Views today. We revised forecasts globally to reflect greater inflation risks in the US and less sovereign stress in Europe following the Fed's proclamation of open-ended asset J.P.Morgan Official sector bond holdings relative to global bond market 60% 50% 40% 30% 20% 10% 0% ..0 - Relative to bonds rated AA and above Relative to AAA-rated bends 2005 2006 2007 2008 Boyce: J.P. Morgan. Blomberg 2009 2010 2011 More details in ... US Credit Markets Outlook and Strategy. Ent Bernstein el at. High Yield Credit Markets Weekly. Peter &cloven/ et al. European Credit Outlook & Strategy. Steven Oulake et at. Emerging Markets Cross Product Strategy Weekly. Eric Beinsteiner 3 EFTA01181260 Jan Loeys t-21218345870 Global Asset Allocation The J.P. Morgan View 21 September 2012 purchases on September 13 and the ECB's commitment to fund the periphery (within conditions) on September 6. End-2012 targets with previous forecast in parentheses are now EUR/USD 1.30 (1.24), GBP/USD 1.62 (1.58), USD/JPY 78 (78), AUD/USD 1.04 (1.02), USD/BRL 1.98 (1.98), USD/MXN 12.50 (12.50), USD/CNY 6.32 (6.30), USD/KRW 1125 (1150), USD/TRY 1.8 (1.8) and USD/ZAR 8.50 (8.30). • Although the world's biggest central banks (Fed, ECB, BoE, BoJ and SNB) have been engaging in various forms of QE all year, the dollar has been the biggest casualty so far. It is down 3% trade-weighted, outdone only by the declines in IDR, BRL, ARS and GHS. This momentum surprises some who think of all balance sheet expansions as equal and therefore offsetting as far as their currency influence. Not true, in our view: As we have argued before, balance sheet expansion entails positive and negative effects on currencies, so the central bank's decision on how and when to deploy liquidity is critical. The currency-positive effect is lower default risk if the central bank targets distressed assets (ECB). The negative effect is lower real yields if asset purchases push nominal rates down and inflation expectations up. If default rates decline, this impact is positive where investors are underweight the currency as a credit hedge (EUR), since QE drives short-covering. If real rates fall, QE is more negative if the country is a capital importer (US) or if investors had been long the currency (USD in 2009) or close to neutral (September 2012), since investors will fund carry trades in the lowest-yielder. • From this perspective it should be clear why the Fed should have more luck weakening the dollar with its balance sheet than will the ECB or the Bank of Japan. Fed QE is driving up inflation expectations more quickly and from a higher level than are the ECB or BoJ; the US is the current account debtor amongst the G-3; and investors are roughly neutral between funding in dollars and euros after six weeks of short-covering in the euro crosses. To offset the Fed's move, the ECB would need to cut rates again, in our view. Commodities • Commodities sold off sharply this week, led lower by oil. Oil is down 6% as Saudi Arabia stated it will be offering extra oil in an attempt to lower prices. Since then, prices have stabilized somewhat and are moving higher again. It seems unlikely we will see materially lower oil prices for the time being given ongoing tensions in the Middle East and a QE induced weaker USD. We remain long energy and long Brent time spreads in ow GMOS portfolio as a hedge against the risk of a supply shock in the Middle East. • Agriculture prices have been in a choppy range for the last two months and appear to have peaked. Historically, agriculture prices have experienced some element of mean reversion. This should make sense from a fundamental perspective as price spikes typically occur because of some supply shock, often because of unfavorable weather. However, higher prices induce higher planting and so greater supply from subsequent harvests, which pushes prices back down. Our Agriculture strategists see prices falling through next year precisely because of this dynamic. We thus take profit on our longs in corn and soybeans and open a short GSCI agriculture position. This trade also has positive slide given the current upward slope of most agriculture curves. In our GMOS long-only commodity portfolio, we balance this trade by removing our UW in base metals so that we are OW energy and gold but UW agriculture. FX weekly change in USD 1.0% 0.5% 0.0% 45% -1.0% -1.5% J.P.Morgan USD JPY EUR GBP CHF CAD AUD TWI Source J.P. Wean More details in FX Markets Weekly. John Normand et al. Commodity Markets Outlook 8 Strategy. Colin Fenton et al. Oil Markets Monthly. Cohn Fenton el al. Daily Metals Note. Colin Fenton et al. Agriculture Weekly. Dietz el al. 4 EFTA01181261 Jan Loeys (1-212) 834-5874 Interest rates Global Asset Allocation The J.P. Morgan view 21 September 2012 Current Dec-12 Mar-13 Jun-13 Sep-13 J.P.Morgan YTD Return' Unted States Fed fiords rate 0.125 0.125 0.125 0.125 0.125 1.77 2.00 2.00 2.00 2.25 10-year yields 1.6% Euro area Red rate 0.75 0.50 0.50 0.50 0.50 1.60 10-year yields 1.50 1.50 1.60 1.70 2.5% United Kngdom Repo rate 0.50 0.50 0.50 0.50 0.50 1 83 0.05 0.05 0.05 0.05 0.05 10-year yields 1.65 1.65 1.80 1.95 2.5% Japan Overnght cal rate 10-year yields 0.80 0.90 0.90 0.95 1.00 1.6% 5.7% GBI.EM hedged in S Yield Global Diversified 5.87 6.00 Credit Markets Current Index YTD Return' US hgh grade (bp over USTI Euro high grade (bp over Euro gov) USD high yield (bp vs. UST) Euro high yield (bp over Euro goy) EMBIG (bp vs. UST) EM Corporates (bp vs. UST) 170 JPfilorgan JULI Porfolo Spread to Treasury 196 IBoxx Euro Corporate Max 555 JPMorgan Global High Yield index 51W 8.0% 7.9% 12.8% 18.7% IBoxx Euro HY Index 293 346 JPMEM Corporates (CEME0) EMBI Global 14.1% 13.4% Commodities Current Ouartedy Averages 1214 1301 1302 1303 GSCI Index YTD Return' 120 Energy -1.0% Brent (S/bbl) Gold (S/o2) Cermet (S/metdc ton) Can (Nu) 111 105 112 105 1776 1725 1750 1775 Precious Metals 12.2% 8263 8300 8500 8700 7.50 8.75 850 8.25 Industrial Metals 5.1% Agriculture 17.3% Foreign Exchange EURMSD USD'JPY GBP1USD Current Dec-12 Mar-13 Jun-13 Sep-13 3m cash YTD Return' Index In USD 1.30 78.2 18 19 79 1.62 1.30 1.30 1.32 1.34 EUR 0.9% JPY 1.4% GBP 5.5% 79 1.62 1.62 1.63 1.65 USD1RL US1ICNY 2.02 1.98 1.95 1.95 1.95 6.31 6.32 6.32 6.30 6.25 BRL -2.3% CNY t2% USMR'N USO/IRY 1119 1125 1125 1110 1100 1.79 KRW 4.6% TRY 11.7% 1.80 1.75 1.75 1.70 YID Return Equities Current (local coy) S&P Nasdaq Topix FTSE 100 5853 8.4% 1464 18.0% 3190 22.6% 756 4.8% MSCI Eurozcnot 147 16.2% MSCI Europe' 1122 13.3% MSCI EM 5' 998 11.8% Brazil Bovespa 61971 9.3% Hang Seng 20735 14.9% Shanghai SE 2027 -7.9% 'Levelsketums as of Sep 20.2012 Local currency except MSCI EM Source:. Morgan US Sector Allocation • YID Europe YTD YTD Japan EM YTD (S) Energy Materials 9.0% 1.6% 14.4% 11.8% -4.6% 6.1% -6.3% 5.4% In0usbials 12.7% 153% 1.1% 10.8% Discretionary Staples Healthcare Financials 23.4% 22.3% 9.1% 10.5% 13.6% 14.0% 12.5% 14.7% 10.8% 244% 22.9% 14.5% -36% 19.9% 17.5% 15.3% 23.9% 20.1% Information Teal. 24.6% 14.9% Telecommunications 26.6% 1.8'% 9.2% 123% -20.0% 4.1% 4.8% 11.8% Uteties Overall 3.1% 9 18.0% 13.3% 5 EFTA01181262 Jan Loeys 1-2121834-5874 Global Asset Allocation The J.P. Morgan View 21 September 2012 Global Economic Outlook Summary J.P.Morgan Real GDP %mw a plat ago Real GDP % over creeous period. saar Consumer prices % over a year ago 2011 2012 2013 1Q12 2Q12 3Q12 4Q12 1Q13 2013 3013 4011 2Q12 4Q12 2Q13 The Americas Drilled States 1.8 2.2 2.0 2.0 1.7 1.5 2.0 1.5 23 2.5 3.3 1.9 2A 1 1.7 Canada 2.4 2.0 2.1 1.8 1.8 2.0 2.1 2.1 21 2.7 1.6 2.4 2.0 Latin America 4.2 2.9 t 3.7 2.9 yl t 4.5 4.0 3.3 1 3.6 1 3.9 7.2 6.0 6.3 7.2 Argentina 8.9 3.3 2.2 3.6 -4.5 8.0 6.0 0.0 15 0.5 9.6 10.0 10.0 11.0 Brea 27 1.4 4.1 0.5 1.6 4.8 4.6 3.8 4.0 4.3 6.7 5.0 5A 5.5 Chile 6.0 5.0 4.5 5.1 7.1 2.0 4.0 4.6 4.7 4.4 4.0 3.1 23 3.1 Colontia 5.9 431 4.5 091 6.71 22 4 321 4.2 1 53 1 5.51 3.9 3A 3.1 32 Ecuador 7.8 4.0 4.0 2.8 3.5 4.0 4.0 4.0 4.0 5.0 53 5.1 42 4.4 Mexico 19 3.9 3.6 4.9 3.5 3.5 3.5 4.0 3.2 3.3 33 3.9 4A 4.1 Peru 6.9 6.0 7.0 8.3 6.0 5.5 6.0 8.0 8.0 7.0 43 4.1 3.1 2.8 Uruguay 5.7 3.5 4.0 1121 2.1 t 9A 1 4.0 t 12.01 7.0 t 9.01 8.3 8.0 7.6 72 Venezuela Asia/Pacific 4.2 5.0 0.0 10.1 0.6 3.5 .3.0 .3.0 0.0 3.0 283 22.3 23.4 373 Japan -0.7 2.0 0.6 5.3 0.7 ag 0.0 1.0 12 1.3 4.3 02 0.0 -02 Australia 2.1 35 25 5.6 2.6 1.5 1.8 3.8 25 1.8 3.1 12 1.7 2.7 New Zealand 1.3 2.6 t 2.9 t 4.1 1 2.3 t 131 33 t 3.7 t 3.31 2.01 1.8 1.0 1 1.71 1.8 L Asa ex Japan 7.4 6.1 6.5 7.2 5.7 5.5 6.4 6.6 62 7.1 42 32 33 32 China 9.3 7.6 8.3 6.5 6.7 8.5 8.5 8.7 8.7 4.6 29 23 3.5 Hong Kong 5.0 1.2 3.2 2.4 4.4 2.0 2.5 3.5 35 5.0 5.7 42 23 2.7 India 6.5 5.6 6.0 6.1 5.3 5.2 5.0 5.8 6.0 6.8 8A 10.1 9.8 9.0 Indonesia 6.5 5.0 3.7 4.6 6.2 3.0 3.0 3.5 45 5.0 4.1 43 32 22 Korea 16 2.4 3.3 35 1.1 2.0 35 35 35 4.0 4.0 24 1.9 31 Malaysia 5.1 4.7 2.9 5.8 5.9 2.5 13 2.0 3.0 35 32 1.7 1.1 1.2 Phiippines 18 5.3 3.5 12.6 0.9 La 1.2 4.5 45 4.5 4.7 2.9 23 23 Singapore Taiwan Thaland Africa/Middle East 4.9 4.0 0.1 2.1 1.1 5.8 3.4 3.9 27 9.5 1.5 50.8 4.7 3.5 13.9 ta 1.8 2.0 4.1 3.8 2.0 4.1 4.5 15 4.1 4.6 2.0 4.1 4.8 2.0 55 1A 4.0 53 11 2S 3.4 21 1.3 2.4 1.8 1.1 Israel 4.61 3.0 3.1 1 3.1 t 3.4 t 2.0 2.8 4.9 6.1 6A 25 1.6 1.3 13 South Afnca Europe 3.1 2.6 3.2 2.7 3.2 2.3 2.4 3.8 32 3.6 6.1 5.7 53 5.6 Euro area 13 4.5 0.3 t -0.1 47 j. Q 45 0.8 t 02 1 1.31 2.9 25 2.5 1.9 Germany 3.1 1.0 1.3 t 2.0 1.1 0.3 0.5 1.5 1.8 1 2.0 1 2.6 2.1 2.1 1 1.8 1 France 1.7 0.1 0.71 0.1 43.2 4.3 0.0 0.8 13 t 1.5 1 2.6 2.3 2.1 1 1.5 Italy 03 4.5 1 4.7 1 -3.3 -3.3 1 -2.5 -13 43 1 0.0 1 0.5 t 3/ 16 3.1 1 2.2 1 Spain 0.4 -1.41 451 -1.3 -1.7 211 -2.0 0.0 t 1.0 t 1.0 1 2.7 1.9 331 2.7 United Kingdom 0.8 4.4 1.5 -1.3 -1.8 2.0 0.5 1.5 2.0 2.5 4.6 2.8 2.7 2.6 Emenjog Europe 4.8 2.7 3.0 2.4 1.3 1.3 2.2 3.1 3.1 3.6 6.4 5.0 5.9 5.9 Bulgaria 1.7 1.0 2.5 Czech Republic 1.7 -1.1 0.9 -3.1 43.8 -1.2 -1.3 2.1 1.0 4.3 24 3.4 22 24 Hungary 1.6 -1.2 0.8 -3.5 4.9 SU 0.5 1.0 15 1.8 4.1 53 53 33 Poland 4.3 2.4 2.1 2.4 1.6 La 1.6 1.8 24 15 4.6 4.0 3.7 2.6 Romania 2.5 0.6 0.9 0.6 2.1 -1.0 0.8 1.2 4.4 32 3.4 1,9 4.7 6.4 Russia 4.3 3.6 3.4 3.7 1.5 2.0 3.0 4.0 4.0 17 6.8 3.9 6.7 7.4 Turkey Global Developed markets 8.5 10 13 2.8 2.4 1.2 4.1 2.6 1.2 3.0 1/ 191 0.6 ... 1.8 0.2 ... 23 0.8 ... 2.7 1.3 1 3.0 t 1.6 1 ... 3.2 1.9 1 92 32 2/ 9.4 2.8 12 63 291 1.9 1 52 2.8 1 1.61 Emerging markets 6.1 4.7 5.2 5.3 421 4.6 5.1 5.3 55 5.8 5.7 4.6 4.5 5.0 Source: Morgan 6 EFTA01181263 Jan Leap t1-2121834-5874 Disclosures Global Asset Allocation The J.P. Morgan View 21 September 2012 J.P.Morgan Analyst Certification: The research analyst(s) denoted by an "AC" on the cover of this report certifies (or, where multiple research analysts are primarily responsible for this report, the research analyst denoted by an "AC" on the cover or within the document individually certifies, with respect to each security or issuer that the research analyst covers in this research) that (I) all of the views expressed in this report accurately reflect his or her personal views about any and all of the subject securities or issuers; and (2) no part of any of the research analyst's compensation was, is, or will be directly or indirectly related to the specific recommendations or views expressed by the research analyst(s) in this report. 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