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Content. An Economist’s View The Global Crisis Excess Supply in the Money and Credit Markets The Next Bubble The Lost Paradise Brazilian Convergence to World Multiples A Financeer’s View The ultimate arbitrage in Brazil Growth Capital for a Long Cycle An Entrepreneur’s View

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  1. Content • An Economist’s View • The Global Crisis • Excess Supply in the Money and Credit Markets • The Next Bubble • The Lost Paradise • Brazilian Convergence to World Multiples • A Financeer’s View • The ultimate arbitrage in Brazil • Growth Capital for a Long Cycle • An Entrepreneur’s View • A New Vehicle to Exploit PE Opportunities • Where is the Best Fishing? • A Larger Platform with a Partnership Structure and R$ 4 Bn of AUM

  2. The End of the U.S. Super Cycle The Super Cycle Serial Bubbles Inflation Fight Cyclical Recovery Corporate Restructuring New Paradigm Reflation Greenspan Reflation Bernanke Crash Easy Money Fundamentals Irrational Exuberance Easy Money Black Hole Black Monday Standard and Poor's 500 Index

  3. The Next Bubble in the Making The Super Cycle Serial Bubbles Inflation Fight Cyclical Recovery Corporate Restructuring New Paradigm Reflation Greenspan Reflation Bernanke Crash Black Monday Irrational Exuberance 30-year Treasury Bond Yield Black Hole

  4. The Bubble Making Machine Equity Markets Housing Labor Markets

  5. Monetary Regime Change Bank of Korea bought 25 metric tons of gold Mexico has quietly purchased nearly 100 tons of gold India's central bank bought 200 tons of gold from the IMF Gold

  6. The Breakdown of the Financial System After crisis Before crisis Equity Negative Equity Equity LOSS Deleverage Inflation Guaranteed Assets Liabilities Assets Liabilities Assets Liabilities

  7. The Decline of America 2000: Income Peaked source: U.S. CENSUS BUREAU

  8. An Asset Dependent Economy US Households Net Worth Real $ trillion

  9. Europe, the Lost Paradise Welfare model exhaustion welfare state post-war reconstruction wealth creation “interest rates convergence” money flowed freely Structural Reforms Better Europe

  10. 3,5 billion Eurasians

  11. The World War for Jobs Excess Scarce

  12. Global Monitoring 2008 2009 2010 2011 2012 2013 2014 China Overheating Landing “soft” vs. “hard” China Deleverage Global Reflation Reflation US Europe Growth “strong” Cyclical Recovery US Japan US Fiscal & Monetary adjustment Europe DM EM Europe “weak” Sustainable Recovery Depression

  13. On the Fence isolationists Global Markets Aliança do Pacífico Peronistas & Bolivarianos

  14. Low Growth Trap TAXES (%GDP) 34,6% Impostos (média) 40s: 14,2% 80s: 25,2% 50s: 16,4% 90s: 27,2% 60s: 20,0% 00s: 33,0% 70s: 25,2% 29,8% (plano Real) 27,0% 26,0% average: 23,9% 21,0% 18,7% 22,4% (1988 constitution) 15,8% 17,0% (Military Coup) 14,4% 21,1% 20,9% % Government Investments / Taxes 14,7% 10,6% 9,5% 5,8% 2000 1990 1980 1970 1960 2010 1950

  15. Circular Mill Trap PMDB PSB, PSD CONSERVATIVES PT PSDB

  16. A Financier's View The Ultimate Arbitrage in Brazil Listed Companies Entrepreneurship Award Unlisted Companies

  17. Growth Capital for a Long Cycle • Lack of Entrepreneurs, management and governance to access public equity markets We still have a window of opportunity for the coming years Listed Value • Brazil has less than 400 listed companies, compared to 1,500 in the mid 80s, in an economy of US$2.0 trillion. Equity Price Entrepreneurship Prize • An opportunity for Private Equity Funds to capture the arbitrage between private and public equity valuations. Eike is anecdotal case of it Unlisted Value

  18. Where is the Best Fishing? Many Fund Managers Few Fund Managers 400 Listed Companies 15,000 Mid Market Unlisted Companies

  19. An Entrepreneur’s View Brazilian Convergence to World Multiples Brazilian Stock Market in Dollar 1963 – 2012

  20. A Larger Platform with a Partnership Structure… • … and R$ 4 Billion of AUM Executive Partners Bozano Group 20% 80% Private Equity Space Asset Management Education, Innovation & Technology Consumer Goods, Retail & Services Real Estate, Oil & Gas, Transportation & Infrastructure Mutual Funds, Public Equities, Quantitative Funds, etc.

  21. Rio de Janeiro Av. Afrânio de Melo Franco, 290 - Sala 503| Leblon Rio de Janeiro, RJ |22430-060 T+55 (21) 3687-1500 T+ 55 (21) 3503-3600 São Paulo Rua Campos Bicudo, 98 – Sala 152 | Itaim Bibi São Paulo, SP |04536-010 Recife Rua Antônio Lumack do Monte, 128 – Sala 102 | Boa Viagem Recife, PE |51020-350 T +55 (81) 3325-0826 contato@bozanoinvest.com www.bozanoinvestimentos.com

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