HOW MANY BRICKS DOES IT TAKE TO COMPLETE A BUILDING MADE OF BRICKS?? WHILE YOU ARE WAITING HOW MANY BRICKS DOES IT TAKE TO COMPLETE A BUILDING MADE OF BRICKS??

DON’T BE MESSIN WITH TEXAS

BIGFOOT INVESTMENTS - OPEN FORUM May 4, 2017 WELCOME! Volume #290

AGENDA WELCOME! ADMIN NOTES QUOTE OF THE DAY SWAPS AND SPREADS OPTIMISM GAUGE DIAGNOSTICS GAGE FED TRACKER MAY PORTFOLIO CHANGES SUM AND SUBSTANCE HIGH IMPACT WEEKLY INTELLIGENCE GLOBAL PERSPECTIVE DAVID’S CORNER ADVISOR INPUT QUESTIONS/COMMENTS

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If you have questions or concerns please let us know. BIGFOOT ADMIN NOTE: Due to a change in the way NASDAQ OMQ charges for Mutual Fund quotations, we are now downloading the data on a two-day delay. This will result in a delay in posting the weekly trade signals until Sunday and will also delay the Watch List signals and other system pricing for two days. We regret any inconvenience but the cost for daily quotations is basically prohibitive. Also, since we are dealing with funds, the delay, in most cases, should not be material in the execution of trades. If you have questions or concerns please let us know.

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“QUOTE” OF THE DAY: My uncle’s dying wish – he wanted me in his lap…. …he was in the electric chair. Rodney Dangerfield

Optimism Gauge As of: 5/4/2017

>50-day MA/>100-Day MA Change Measuring Our Economy Last Update: 5/4/2017 Weekly Updates New Monthly Updates Indicator Current Value Prior/Metric Value St Louis Fed Financial Stress Index - 1.427 - 1.317 (Rev) +1.0 Chicago Fed National Act Index (3 Mon M/A) +0.03 +0.16 (Rev) -.50 Unemployment 4.5% 4.7% +2.00 Weekly Jobless Claims (4Wk Mov Av) 243,000 242,750 ECRI Weekly Index (Against 52 Wk Av) 143.2 144.1 (Rev) +.50 Conf Board Leading Indicators (NEW) 126.7 126.2 University of Michigan Sentiment – Final 97.0 (Final – Apr 2017) 96.9 (Final – Mar 2017) Monthly Retail Sales – ex Autos (Adjusted) 375,828 (Mar -2017) 375,677 (Feb-2017) Rev NFIB Small Business Sentiment 104.7 (Mar -2017) 105.3 ISM Manufacturing 54.8 (Expansion Line = 50) 57.2 Economic Capacity Utilization 76.1% 75.7% (Rev) Stock Market Moving Averages Weekly Data Points >50-day MA/>100-Day MA N/A S&P Case-Shiller 20 City Comp Index (YoY) 5.9% (Feb) 5.7% (Jan) (Rev)

Economic Optimism Index Measuring our Economy 10 20 30 40 50 60 70 80 90 100 Economic Optimism Index Current: Prior: 90.08% READING AS OF: 5/4/2017 Current Reading: 90.08% Trend: Negative Prior Reading: 95.77(Rev) Bias: Positive

Week of: May 1st, 2017 BigFoot Investments Market Diagnostics Week of: May 1st, 2017 BigFoot Investments

SENTIMENT INDICATORS Week of May 1st - 2017 1. AAII Investor Survey 2. TSP Sentiment Survey 3. NAAIM Survey of Manager Sentiment 4. CBOE Volatility Index INTERNAL INDICATORS 5. S&P500 - 50D MA and 200D MA AND 2/10 MA 6. NYSE Bullish % 7. S&P 500 Bullish % ($BPSPX) 8. Percent of NYSE stocks above 200DMA 9. Percent of NYSE stocks above 10WMA or 50DMA ($NYA50R) 10. NYSE 52-Week New Highs and New Lows 11. Percent of S&P500 stocks above 200DMA 12. Percent of S&P500 stocks above 50DMA ADDED INDICATORS 13. Option Sentiment 14. Option Buyers Sentiment Gauge (OBSG) 15. Consumer Sentiment Index 16. Nasdaq Sentiment Index 17. Rydex Nova/Ursa Sentiment Indicator

Week of May 1st, 2017 29.41% Prior: 17.64%

FOMC INTEREST RATE DECISION/STATEMENT READY, SET …..HIKE! MEMBER DISTRICT TOPIC LINK TO SOURCE FOMC INTEREST RATE DECISION/STATEMENT Fischer Vice Chair Friday Williams San Francisco Evans Chicago Yellen Chair Rosengren Boston Sunday

Blah, Blah, Blah – pretty much as usual Maintained FDFD: 75-1.00bp FED COMMENTS Blah, Blah, Blah – pretty much as usual Maintained FDFD: 75-1.00bp Maintained policy of reinvesting principal payments from Agency securities and rolling over maturing Treasury securities Discount rate 1.5% Still a bit obfuscated on inflation (“close”, “somewhat below”, “low”, “little changed”) “Economic conditions will evolve in a manner that will warrant gradual increases in the Fed Funds Rate” “Rates likely to remain, for some time, below levels expected to prevail in the longer run” Kept RRP agreements in place at 75bp No dissenting votes Source: Federal Reserve

2’S IT……FOR NOW 51.6 http://www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html Source: CME; Federal Reserve

Credit Anticipates-Equity Confirms Swaps and Spreads Rate Prior Current Status* Libor/OIS 0.26   Euribor/Eonia -0.027 DTCC Repo - Agency Discontinued DTCC Repo - MBS 0.956 0.863 DTCC Repo – Treasury 0.915 0.846 High Yield 4.07 3.79 Fed Reserve Currency Swaps-Short 45 (ECB) 0 (BOJ) 80 (ECB) Fed Reserve Currency Swaps-Long 2-Year Swap Spread 0.317 0.277 TED Spread 0.348 0.299 As of: 5/3/2017 COB *Note: Status = No major impact Status = Negative Impact Status = Moving Worse

EARNINGS UPDATE Bloomberg, Citi Source: Source: Standard & Poor’s, FactSet, J.P. Morgan Asset Management, Bloomberg, Citi

WHO IS AND WHO AIN’T Source: Bespoke Investments

MAY PORTFOLIO CHANGES

May 2017 Stock Picks IN: COST OUT: MHK TOP 25 STOCKS May-17 RANK TICKER NAME SECTOR INDUSTRY 1 FB Facebook Inc 10 - Technology 1018 - Computer Services 2 CELG Celgene Corporation 08 - Health Care 0803 - Biotechnology & Drugs 3 ULTA Ulta Beauty Inc 09 - Services 0963 - Retail (Specialty Non-Apparel) 4 AMZN Amazon.com, Inc. 0948 - Retail (Catalog & Mail Order) 5 GOOGL Alphabet Inc 6 BABA Alibaba Group Holding Ltd 7 EW Edwards Lifesciences Corp 0812 - Medical Equipment & Supplies 8 AGN Allergan plc 9 COST Costco Wholesale Corporation 10 DHI D.R. Horton, Inc. 02 - Capital Goods 0215 - Construction Services 11 AAPL Apple Inc. 1003 - Communications Equipment 12 V Visa Inc 0909 - Business Services 13 CBS CBS Corporation 0906 - Broadcasting & Cable TV 14 GD General Dynamics Corporation 0203 - Aerospace and Defense 15 DIS Walt Disney Co 16 HD Home Depot Inc 0960 - Retail (Home Improvement) 17 FDX FedEx Corporation 11 - Transportation 1103 - Air Courier 18 WLK Westlake Chemical Corporation 01 - Basic Materials 0106 - Chemicals - Plastics and Rubbers 19 USCR US Concrete Inc 0212 - Construction - Raw Materials 20 DAL Delta Air Lines, Inc. 1106 - Airline 21 DOW Dow Chemical Co 22 XOM Exxon Mobil Corporation 06 - Energy 0609 - Oil & Gas Operations 23 C Citigroup Inc 07 - Financial 0727 - Regional Banks 24 ARNC Arconic Inc 0124 - Metal Mining 25 BAC Bank of America Corp As of April 28th, 2017- Subject to change.

Investment Style of the Portfolio TOP 25 STOCKS May-17 ULTIMATE SCREEN-BASED LIST RANK TICKER NAME Popular Value Growth Quality Sentiment 1 FB Facebook Inc YES 2 CELG Celgene Corporation 3 ULTA Ulta Beauty Inc 4 AMZN Amazon.com, Inc. 5 GOOGL Alphabet Inc 6 BABA Alibaba Group Holding Ltd 7 EW Edwards Lifesciences Corp #N/A 8 AGN Allergan plc 9 COST Costco Wholesale Corporation 10 DHI D.R. Horton, Inc. 11 AAPL Apple Inc. 12 V Visa Inc 13 CBS CBS Corporation 14 GD General Dynamics Corporation 15 DIS Walt Disney Co 16 HD Home Depot Inc 17 FDX FedEx Corporation 18 WLK Westlake Chemical Corporation 19 USCR US Concrete Inc 20 DAL Delta Air Lines, Inc. 21 DOW Dow Chemical Co 22 XOM Exxon Mobil Corporation 23 C Citigroup Inc 24 ARNC Arconic Inc 25 BAC Bank of America Corp As of April 28th, 2017. Subject to change.

Beta of the Portfolio – May 2017 RANK TICKER NAME SECTOR INDUSTRY BETA Weight Weighted Beta 1 FB Facebook Inc 10 - Technology 1018 - Computer Services 0.67 0.04 0.0268 2 CELG Celgene Corporation 08 - Health Care 0803 - Biotechnology & Drugs 1.78 0.0712 3 ULTA Ulta Beauty Inc 09 - Services 0963 - Retail (Specialty Non-Apparel) 0.56 0.0224 4 AMZN Amazon.com, Inc. 0948 - Retail (Catalog & Mail Order) 1.43 0.0572 5 GOOGL Alphabet Inc 0.97 0.0388 6 BABA Alibaba Group Holding Ltd 0.76 0.0304 7 EW Edwards Lifesciences Corp 0812 - Medical Equipment & Supplies 0.61 0.0244 8 AGN Allergan plc 1.11 0.0444 9 COST Costco Wholesale Corporation 0.91 0.0364 10 DHI D.R. Horton, Inc. 02 - Capital Goods 0215 - Construction Services 1.13 0.0452 11 AAPL Apple Inc. 1003 - Communications Equipment 1.21 0.0484 12 V Visa Inc 0909 - Business Services 0.96 0.0384 13 CBS CBS Corporation 0906 - Broadcasting & Cable TV 1.60 0.0640 14 GD General Dynamics Corporation 0203 - Aerospace and Defense 15 DIS Walt Disney Co 1.20 0.048 16 HD Home Depot Inc 0960 - Retail (Home Improvement) 1.07 0.0428 17 FDX FedEx Corporation 11 - Transportation 1103 - Air Courier 1.17 0.0468 18 WLK Westlake Chemical Corporation 01 - Basic Materials 0106 - Chemicals - Plastics and Rubbers 1.68 0.0672 19 USCR US Concrete Inc 0212 - Construction - Raw Materials 20 DAL Delta Air Lines, Inc. 1106 - Airline 0.87 0.0348 21 DOW Dow Chemical Co 1.15 0.046 22 XOM Exxon Mobil Corporation 06 - Energy 0609 - Oil & Gas Operations 0.88 0.0352 23 C Citigroup Inc 07 - Financial 0727 - Regional Banks 1.65 0.066 24 ARNC Arconic Inc 0124 - Metal Mining 25 BAC Bank of America Corp 1.40 0.056 1.00 1.10 For a Portfolio with 100% invested in Equity – Beta of Portfolio= 1.10

Beta of the Portfolio – April 2017 RANK TICKER NAME SECTOR INDUSTRY BETA Weight Weighted Beta 1 FB Facebook Inc 10 - Technology 1018 - Computer Services 0.67 0.04 0.0268 2 ULTA Ulta Beauty Inc 09 - Services 0963 - Retail (Specialty Non-Apparel) 0.60 0.024 3 CELG Celgene Corporation 08 - Health Care 0803 - Biotechnology & Drugs 1.78 0.0712 4 MHK Mohawk Industries, Inc. 04 - Consumer Cyclical 0433 - Textiles - Non-Apparel 1.19 0.0476 5 AMZN Amazon.com, Inc. 0948 - Retail (Catalog & Mail Order) 1.46 0.0584 6 GOOGL Alphabet Inc 0.97 0.0388 7 BABA Alibaba Group Holding Ltd 0.76 0.0304 8 EW Edwards Lifesciences Corp 0812 - Medical Equipment & Supplies 9 AAPL Apple Inc. 1003 - Communications Equipment 1.25 0.05 10 V Visa Inc 0909 - Business Services 0.95 0.038 11 DHI D.R. Horton, Inc. 02 - Capital Goods 0215 - Construction Services 1.14 0.0456 12 DIS Walt Disney Co 0906 - Broadcasting & Cable TV 1.20 0.048 13 AGN Allergan plc 1.15 0.0460 14 GD General Dynamics Corporation 0203 - Aerospace and Defense 0.74 0.0296 15 CBS CBS Corporation 1.65 0.066 16 WLK Westlake Chemical Corporation 01 - Basic Materials 0106 - Chemicals - Plastics and Rubbers 1.69 0.0676 17 HD Home Depot Inc 0960 - Retail (Home Improvement) 1.08 0.0432 18 FDX FedEx Corporation 11 - Transportation 1103 - Air Courier 1.16 0.0464 19 USCR US Concrete Inc 0212 - Construction - Raw Materials 20 DAL Delta Air Lines, Inc. 1106 - Airline 0.83 0.0332 21 DOW Dow Chemical Co 0.046 22 BAC Bank of America Corp 07 - Financial 0727 - Regional Banks 1.45 0.058 23 C Citigroup Inc 1.67 0.0668 24 XOM Exxon Mobil Corporation 06 - Energy 0609 - Oil & Gas Operations 0.88 0.0352 25 ARNC Arconic Inc 0124 - Metal Mining 0.92 0.0368 1.00 1.12 For a Portfolio with 100% invested in Equity – Beta of Portfolio ≈ 1.12

CHANGE IN BETA Apr-17 OLD MHK 1.19 May-17 NEW COST 0.91 AVG. BETA

May 2017 Growth Stock Picks As of April 28th, 2017. Subject to change.

May 2017 Growth Stock Picks COST As of April 28th, 2017- Subject to change.

May 2017 Growth Stock Picks As of April 28th, 2017- Subject to change.

May 2017 Growth Stock Picks As of April 28th, 2017- Subject to change.

May 2017 Growth Stock Picks As of April 28th, 2017- Subject to change.

May 2017 Growth Stock Picks As of April 28th, 2017- Subject to change.

SUM SUBSTANCE

KEEP YOUR EYE ON THE BALL WEEKLY MACRO DATA KEEP YOUR EYE ON THE BALL

Personal Income/Spending Employment/Productivity WEEKLY HIGH IMPACT GDP/Growth Sentiment Manufacturing Personal Income/Spending Non-Manufacturing Oil/Dollar Fed Employment/Productivity

NOT GREAT (SLOWEST IN 3 YEARS) BUT NOT ALL BAD Q1 GDP often slumps Average growth rate over the last 7 years 1.0% Q1 and 2.5% Q2 Tax schedules – seasonal issues Residential investment up 13.7% Government spending down 1.7% Real final sales to purchasers (excludes inventories/exports) up 1.5% $39.3B drop in inventories subtracted .9 bp from GDP Source: BEA; J.P. Morgan

WHAT “THEY” THINK Source: Atlanta Fed

BELOW EXPECTATIONS BUT UP M/M Although this high level of sentiment has yet to translate into faster consumer spending growth this year, we acknowledge that soft data tends to lead hard data by a few months, and remain upbeat about the near-term outlook for growth. Ned Davis Research Source: University of Michigan

SLIGHT DECREASE BUT STRONG DATA AND IMPROVED OUTLOOK Source: Conference Board

A READ ON THE INDEX Source: Chicago Fed

DOWN SLIGHTLY BUT STILL ABOVE HISTORICAL TREND Source: ISM

OUTPUT DOWN BUT HIRING AND PRICES UP

WELL…THAT DOG WON’T HUNT Source: BEA

A DOWNWARD UPWARD..HOPEFULLY Total construction – down 0.2% Total private construction - flat Total public construction - 0.9% (mainly commercial)

JUST OK AGAINST 175K EST Source: ADP

SURVEYS SUGGEST THAT BUSINESS ACTIVITY IS GROWING AT A SLOWER PACE Forecast: 52.5 Actual: 53.1 Prior: 52.7 Current: 53.2

SLOWER, BUT CONTINUED GROWTH IN MARCH Source: ISM

WHERE’S THE BEEF? Source: BLS

BELOW FORECAST AND ANEMIC….BUT CAPEX UP Source: Census Bureau

Growth and the Bond Market WEEKLY INTELLIGENCE Auto Sales Three For the Money Trade Deficit Growth and the Bond Market

“PEAK” AUTO HAS PASSED BUT NUMBERS OK Source: Motor Intelligence

3 CHARTS TO WATCH Source: Investing.com

OUCH! Source: WSJ

BALANCE OF PAYMENTS CURRENT ACCOUNT CAPITAL ACCOUNT (CHANGE IN ASSETS) WHAT’S A BALANCE OF PAYMENTS? WEAKER DOLLAR HELPS THE NUMBERS BALANCE OF PAYMENTS CURRENT ACCOUNT CAPITAL ACCOUNT (CHANGE IN ASSETS) EXPORTS INCOME RECEIPTS IMPORTS INCOME PAYMENTS NET TRANSFERS ∆ IN FOREIGN OWNED ASSETS IN THE U.S. ∆ FINANCIAL DERIVATIVES ∆ FOREIGN RESERVES ∆ U.S. ASSETS ABROAD ∆ U.S. RESERVES (FED) Private ownership Government ownership THESE SHOULD EQUAL Source: Various

Treasury curve continues to flatten, with the 10yr – 2yr yield spread now near pre-election levels. Markets don’t have faith in longer-term growth improving meaningfully from the current levels. Source: WSJ

OVERALL: DATA POINTS STATUS Comments Growth/GDP Manufacturing Anemic Manufacturing Expanding Non-Manufacturing Employment Skills issues – but strong overall Housing Strong Sentiment More sentiment than hard data but still optimistic Income/Spending Income stagnant – Spending hesitant Oil Supply/Demand debate – OPEC Cuts/Shale production Interest Rates Rates in change mode – creates uncertainty Fiscal Policy Possible but uncertain

Global Global Output Eurozone China CRITERIA SCORE Deficient 0-1 Poor 2-4 Satisfactory 5-7 Good 8-9 Excellent 10

7.0 THREE-MONTH LOW Source: Markit

EUROZONE MANUFACTURING EXPANDS AT FASTEST PACE IN SIX YEARS 8.5 Source: Markit

EUROZONE ECONOMIC GROWTH AT SIX-YEAR HIGH IN APRIL 8.5 Source: Markit

7.0 DOWN FROM 10.2% Y/Y Source: Eurostat

7.0 DECENT Source: Eurostat

GENERALLY GOOD PICTURE 8.0 GENERALLY GOOD PICTURE Source:

6.5 ROLLING OVER Growth in both manufacturing and services decelerated in April, reflecting a clear slowdown in the expansion of the Chinese economy.

0.250 0.200 U.S. Macro Last New

DAVID’S CORNER

ADVISOR INPUTS

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