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Please note: The Frank Talk articles listed below contain historical material. The data provided was current at the time of publication. For current information regarding any of the funds mentioned in these presentations, please visit the appropriate fund performance page.

Rev Up for Resources Boom in China
July 25, 2011

Frank on MarketWatchLast week I sat down with Laura Mandaro from Marketwatch to discuss what’s currently driving commodity markets. One of the key drivers today is the robust economic activity and commodity demand taking place in Asia.

Frequent Frank Talk readers know there is something profound and significant happening in China—the building of a massive high speed rail network. It’s a $300 billion project that will connect more than 250 Chinese cities, span 18,461 miles and reach roughly 700 million people. This is going to create massive demand for commodities and a wave of investment into the sector. We believe that resource companies associated with coal, iron ore and steel are well positioned to benefit from China’s long-term sustainable bull market.

I also discuss a few individual stocks I think are structurally sound as well as talk about a market ready to take off and The Fear and Love Trade.

Investments in natural resources, emerging markets and infrastructure are subject to distinct risks as described in the funds’ prospectus.

The following securities mentioned in the interview were held by one or more of U.S. Global Investors Funds as of June 30, 2011: Freeport-McMoRan, Joy Global.

By clicking the link above, you will be directed to a third-party website. U.S. Global Investors does not endorse all information supplied by this website and is not responsible for its content.

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Move at the Speed of China
July 14, 2011

Shareholder ReportOur latest shareholder report highlights what we believe to be China’s true Great Leap Forward. The country is developing at a much greater and faster rate than America’s boom time in the 1950s. The report recaps portfolio manager Evan Smith’s latest research trip to iron ore facilities in China and discusses where most of the millionaires live in 2020…take a guess where that may be?

Its epic build-out is already having an impact on international businesses vying for market share. American industries, including automobile manufacturers and hoteliers, as well as the European luxury market are all setting up shop along China’s “millionaire row.”

China’s expansion has affected gold demand too. In the article, “Asian Tiger Sinks Teeth into Gold,” we write about how China’s 2010 demand for gold jewelry, bars and coins outpaced the demand of the Developed West, which includes the U.S., France, Germany, Italy, Switzerland, U.K. and other European nations.

To receive your copy in the mail, send us a quick email at editor@usfunds.com with your address. Or, click on the link below to see an online version.

View the Report Online

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China Opens World’s Longest Cross-Sea Bridge
July 5, 2011

Qingdao BridgeWhen the new Qingdao Jiaozhou Bay Bridge opened to traffic this week in China, it made the Guinness World Records for the longest cross-sea bridge in the world. The 26.4-mile long and 110-foot wide bridge stretches across the bay, linking the Huangdao district to the city of Qingdao and Hongdao Island.

China spent 17 years planning and designing the engineering marvel to be able to withstand the bay’s high salt content and icy winters. Yet, it only took four years to build, with at least 10,000 workers on the construction team. The Xinhua news agency says about $2.3 billion was spent, and 450,000 tons of steel and 81 million cubic feet of concrete were consumed in its construction.

Qingdao Jiaozhou Bridge Bay Bridge Map

An estimated 30,000 cars are expected to make the trek across the bay each day. Residents already traveling between Huangdao and Qingdao will have their trip cut in half, from 40 minutes to 20 minutes.

According to The Telegraph, Qingdao is one of China’s fastest-growing cities. It is among the top ten largest container ports in the world, and is the main port of the Chinese navy. Home to around 8 million people, half live in the metro area of the city. Many people might recognize the city as host of the sailing events during the 2008 Beijing Olympics.

While the bridge made headlines for breaking a world record, it is only one of many major infrastructure projects planned by China. In only a few short years, the country has been redefining urbanization at a phenomenal scale:

  • From 2005 through 2025, Chinese cities will add more than 350 million people, which is the entire population of the United States.
  • More than 200 Chinese cities will have more than one million inhabitants. Europe today has 35 cities of that size.
  • There will be 50,000 new skyscrapers, the equivalent of ten New York Cities.

Many of these urban residents have rising incomes and discretionary income to purchase cars and upgrade their homes in pursuit of a better life—just like the American dream. To accommodate this rapid economic development, rising middle class and growing car ownership, China has been ramping up its transportation system. Similar to our story of China’s high speed rails, the magnitude of opportunity is expected to span across many industries, including tourism, restaurants, hotels, construction, property, rail, roads and airlines.

To grasp the immense size of China’s newest bridge, watch this short video* from The Telegraph.

Fire up the grill, enjoy the fireworks and celebrate freedom! Here’s wishing you and your family a very safe and happy holiday weekend!

All opinions expressed and data provided are subject to change without notice. Some of these opinions may not be appropriate to every investor.

*By clicking the link(s) above, you will be directed to a third-party website(s). U.S. Global Investors does not endorse all information supplied by this website and is not responsible for its/their content.

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Emerging Markets Building Highways to Wealth
June 30, 2011

If you think Los Angeles traffic is bad, take a look at the results of IBM’s Commuter Pain Index. Last summer, IBM surveyed more than 8,000 motorists in 20 cities across 6 continents to determine the emotional and economic toll of commuting. They measured the amount of time it took to commute and time stuck in traffic along with whether there was an agreement of the following: the price of gas is already too high, traffic has gotten worse, and driving causes stress and anger.

According to IBM, 13 cities other than LA cause more commuter angst. The top three hail from three different countries: Beijing and Mexico City tie as the world’s worst, with Johannesburg coming in third.

Beijing, Mexico City Tie for Top Place

Yet, of IBM’s 20 surveyed cities, three of them fall within U.S. borders. It’s been 50 years since the U.S. began its infrastructure road project that connected the Heartland to the tip of Florida and the east coast to the west coast. Since then, infrastructure spending has been flatter than America’s buckled roads. As a share of GDP, spending has slowly declined to 2.4 percent.

Infrastructure Spending

In emerging markets, it’s a completely different story. Among the E-7 countries (the seven most populous nations), Brazil, China, India and Mexico have projects in the works that most likely will have a substantially greater impact than America’s “great road program.” These programs attempt to address infrastructure needs to support increasing urban populations with rising incomes and a significant growth in automobile ownership.

Below are a few highlights published in an extensive report done by the Urban Land Institute (ULI) and Ernst & Young:

Brazil Flag Brazil Growth Acceleration Program

The country is preparing to host the 2014 World Cup and the 2016 Summer Olympics, with an infrastructure plan to help fans travel around the country. The government has committed to spending $900 billion over several years to construct power plants, hydroelectric dams, port facilities and a high-speed railway which will run from Rio de Janeiro to Sao Paulo. In Rio, major upgrades to highways and bus lines will help link the downtown to the suburbs and airport.

China flag China’s 12th Five Year Plan

Beginning in 2011, China will allocate $1 trillion in infrastructure spending over the next five years. According to KPMG Insight Series, key projects will be to increase the number of airports from 175 to 220, including building a new airport in Beijing; and extending the length of highways to more than 50,000 miles and high-speed rail to 27,000 miles.

India flag India’s 12th Five-Year Plan

Over the 2012-2017 period, the ULI and Ernst & Young report indicates the national government in India is planning to spend $1 trillion—or about 9 percent of GDP—to build necessary power, water and a transportation system to sustain the growth of its country. As an example of the country’s poor roads and rickety railways, nearly half of fruits and vegetables rot on the way to market. To improve this situation, ULI and Ernst & Young state that the Transport Ministry has “set out an ambitious agenda to build 12 miles of road per day, or 30,000 miles over the next four years.”

Mexico Flag Mexico’s National Infrastructure Plan

In 2007, Mexico began a five-year infrastructure plan totaling more than $141 billion spent on 300 projects including ports, airports, roads, railways, water and energy.

General Roy Stone, American Civil War hero and head of the U.S. Office of Road Inquiry, once said, “Good roads are the highways to wealth.” We agree, as we think these infrastructure projects will help transform these most populous countries from the poorest areas of the world to the next economic powerhouses.

Read a previous blog on the $6 Trillion Opportunity in global infrastructure.

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The Tallest, Longest and Busiest of the World’s Infrastructure
June 10, 2011

Burj Khalifa in Dubai 061011Cities around the world take turns owning the title for the tallest skyscraper, the longest bridge or the deepest mine. Covering nearly every continent of the world, here’s our current list, which I’m sure will change over the next few years.

1. Tallest Skyscraper:
At a height of 2,700 feet, the Burj Khalifa in Dubai has 162 floors and was completed in 2010. If you’re looking for sheer quantity of skyscrapers, Hong Kong has the largest number of high-rise buildings in the world but Benidorm, Spain has the most high-rises per person.

2. Longest Train Track:
The network of rails called the Trans-Siberian Railroad in Russia is the longest train track in the world. The track connects Moscow to the far east of Russia and to the Sea of Japan. An important economic and military development, the railroad has been credited with the growth of several larger cities in Siberia.

3. Longest Railway Tunnel:
The Gothard Base Tunnel, located beneath the Swiss Alps, will soon be the longest railway tunnel in the world. Set to be completed in 2017, the $12 billion project will be longer than the undersea Seikan Tunnel in Japan. With a route length of 35.4 miles, the tunnel should boost trade and travel in Europe.

Arecibo Observatory in Puerto Rico 0610114. Largest Single-Dish Telescope:
The Arecibo Observatory in San Juan, Puerto Rico is the world’s largest single-dish radio telescope. You’ll probably recognize the telescope’s 1,000-foot-wide telescope from Hollywood appearances in both the James Bond movie “Golden Eye” and in “Contact” with actress Jodie Foster.

5. Highest Residential High-Rise Building:
The highest residential high-rise building is located in Gold Coast City, Australia. The Q1 Tower is both a resort facility and offers exclusive luxury apartments with a “stunning beachside location,” an observation deck 771 feet above the ground, and 360 degree views.

The $2 billion home of Mukesh Ambani6. World’s First Billion-Dollar Home:
A 27-story skyscraper in downtown Mumbai carrying a price tag near $2 billion is the world’s first billion-dollar home. The home is owned by India’s richest man, Mukesh Ambani, who runs petrochemical giant Reliance Industries.

7. Tallest Engineered Dam:
The Nurek Dam, located on the Vakhsh River in Tajikistan, is the tallest engineered dam in the world. The dam is an important source of electricity for the country.

8. Longest Cable-Stayed Bridge:
Spanning 8,146 meters above the Jiangsu Province in China, the Suzhou-Nantong Highway Bridge is the world’s longest cable-stayed bridge. The bridge has linked the two prosperous cities of Nantog and Suzhou, shortening the journey between the two from a four-hour ferry ride to just a one-hour drive across the bridge.

Suzhou-Nantong Highway Bridge in China 9. World’s Deepest Mine:
South Africa’s Mponeng mine is the world’s deepest, sending miners and equipment 2.4 miles underground in search of gold.

10. Busiest Airport in the World:
The busiest airport in the world is the Atlanta-Hartsfield Airport in the U.S. The Georgia airport saw 89 million passengers in 2010. It’s also notorious for lengthy delays.

None of U.S. Global Investors Funds held any of the securities mentioned in this article as of March 31, 2011.

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Net Asset Value
as of 11/22/2017

Global Resources Fund PSPFX $5.97 0.03 Gold and Precious Metals Fund USERX $7.36 No Change World Precious Minerals Fund UNWPX $5.76 0.03 China Region Fund USCOX $12.18 0.03 Emerging Europe Fund EUROX $7.09 0.04 All American Equity Fund GBTFX $24.06 -0.05 Holmes Macro Trends Fund MEGAX $21.36 -0.06 Near-Term Tax Free Fund NEARX $2.21 -0.01 U.S. Government Securities Ultra-Short Bond Fund UGSDX $2.00 No Change