EFTA Document EFTA01459772

In our latest CIO Special "Beyond the oil bust: Are markets right to worry?" we look at the causes and consequences of the falling oil price. We think that oil will continue to be a source of uncertainty and can no longer be seen as a "known problem" that can be assessed purely in terms of established fundamentals. We have reduced our forecasts for major equity indices and increased our end-2016 spread forecasts for U.S. high yield. Recent market events may add to concerns about the longer-term negative side effects of looser monetary policy. We are watching current developments closely, but remain generally constructive on the world economy and financial markets. We have included supplementary research pieces that narrow in on some of the key trends in the market place this year. If you wish to discuss where we see opportunity in current markets, we will be happy to schedule a call. Additional pieces include: • 10 Themes for 2016 — Our WM CIO and Chief Investment Strategist, Larry Adam, outlines his top ten expectations for the coming year. Replay instructions for his conference call on the topic are included in the attachments as well. • FX Outlook — Our global FX research team outlines their expectations for major currencies around the world, which centers on their thesis of ongoing USD strength. • Focus Europe — Chief Economist Mark Wall dives into the risks of a slowdown in euro-area growth, primarily driven by an external demand shock and a deflationary shock. • Weekly Highlights — Larry Adam gives an overview of major global asset classes and touches on the unlikelihood of a US recession. • US Equity insights — Head of US Equity, David Bianco, discusses his decision to cut 2016E S&P EPS almost entirely from Financials based on the impact of Fed rate hikes. • Chino's Evolving FX Policy —Our chief economists discuss unanticipated recent events in China foreign exchange policy. Managing the value of the RMB will restrain monetary policy independence, which will eventually have to evolve through true currency flexibility. Paul Morris Managing Director Deutsche Bank Private Bank etr z Peerty)i& CONFIDENTIAL — PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0120445 CONFIDENTIAL SDNY_GM_00266629 EFTA01459772