Bienville Capital Managment - Presentation (December 2010)

7/31/2019 Bienville Capital Managment - Presentation (December 2010)

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CONFIDENTIAL

BIENVILLE CAPITAL MANAGEMENT, LLCDecember 2010


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Bienville Capital Management, LLC | 2

CONFIDENTIAL

OUTLINE OF CONTENTS

I. INTRODUCTION

Bienville Capital Management, LLC 4

Bienville Capital Partners, LP 5

II WHYMACRO? 6

III. INVESTMENT PHILOSOPHY& PROCESS 9

Global Macro Research & Analysis 10

Strategy Allocation 11

Manager Selection 12

Portfolio Construction & Overlay 13

IV. INVESTMENT OUTLOOK 22

V. APPENDICES

Biographies 50

Firm and Contact Information 51


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INTRODUCTION

The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.

William Arthur Ward


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INTRODUCTION

Investment Philosophy

& Process

Bienville Capital

Management, LLC

Investment Themes &

Outlook

Bienville Capital

Partners, LP

Why Macro?

SEC-registered, research-intensive, independent investment advisory firm

Founded in 2008 during the height of the global financial crisis

Clients include high-net-worth individuals and single-family offices

The Bienville team has over 100 years of collective experience in investment management

Significant experience in alternative investments, portfolio construction and overlay management

Extensive experience in manager selection across asset classes and strategies

Performance-driven culture

Passionate about investing

Focus on aligning interests with all investors

Emphasis is on investment risk, not business risk. Our benchmark is risk-adjusted returns

Preference for value and fundamentally-oriented managers versus quantitative strategies Flexible, adaptive investment mandate

Extensive network of contacts and resources throughout the investment industry

Investments in independent research

Offices in New York, NY and Mobile, AL

THE FIRM


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INTRODUCTION

Bienville Capital

Partners, LP

Why Macro?

Adaptive and flexible strategy

Access to a select number of exceptionally talented underlying investment managers

Uncorrelated strategies that contribute to an investors overall portfolio diversification

Concentrated approach with a core set of underlying managers

Focused managers who concentrate capital in their highest conviction ideas

Flexibility via a tactical overlay providing the ability to adapt during volatile markets

Intense focus on risk-adjusted returns and capital preservation

Preference for value and fundamentally-oriented managers versus quantitative strategies

Consensus is often wrong

In-depth top-down research process drives strategic allocation across underlying managers

Rigorous manager selection process that seeks to identify highly-skilled managers

Portfolio construction that combines qualitative understanding with quantitative analysis

Periodic reviews of underlying managers, their underlying exposures and holdings

Independent administrator

Bienville Capital

Management, LLC

THE PARTNERSHIP


& Process

Investment Themes &

Outlook


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WHYMACRO?


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WHYMACRO?

Why Macro?

Bienville Capital

Partners, LP

Bienville Capital

Management, LLC There are inflection points in history. This is one of them

Macro is fundamental. The imbalances that exist today are fundamental in nature

Until the imbalances are resolved, the macroeconomic environment will be the driver of volatility

The consensus is often wrong. It is important to always challenge conventional wisdom

Outlier events occur more frequently than forecasters anticipate. As a result, insurance is necessary

Understanding the environment from a qualitative perspective helps to manage turbulence

Nearly all assets are priced off of the risk-free rate. Yet the risk-free rate is a by-product of central

bankers and macroeconomic policy globally

Policymakers respond to probability distributions whereas are markets are behavioral, reliant on

confidence

Not being able to predict whensomething will happen doesnt mean you should act is if it wont

Getting the big picture right is critical

WHYMACRO?


& Process

Investment Themes &

Outlook


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WHYMACRO?

Why Macro?

Bienville Capital

Partners, LP

Bienville Capital

Management, LLCAt the May 2005 Ira Sohn Investment Research Conference in New York, I recommended MDC

Holdings, a homebuilder, at $67 per share. Two months later MDC reached $89 a share, a nice quick

return if you timed your sale perfectly. Then the stock collapsed with the rest of the sector. Some of myMDC analysis was correct: it was less risky than its peers and would hold up better in a down cycle

because it had less leverage and held less land. But this just meant that almost half a decade later, anyone

who listened to me would have lost about 40% of his investment, instead of the 70% that the

homebuilding sector lost.

The lesson that I have learned is that it isnt reasonable to be agnostic about the big picture. For years I

had believed that I didnt need to take a view on the market or the economy because I considered myselfto be a bottom-up investor. Having my eyes open to the big picture doesnt mean abandoning stock

picking, but it does mean managing the long-short exposure ratio more actively, worrying about what may

be brewing in certain industries.

- David Einhorn (Greenlight Capital), Value Investing Congress (2009)

If people looked at sovereign balance sheets the way value investors look at company balance

sheetsas weve donethe enormity of the debt problem in several European and Eastern Europeancountries becomes clear. We expect to see serial defaults on sovereign debt, as countries hit their

Keynesian end-point, in which theyre no longer able to postpone their fiscal and economic problems with

more debt and more cross-guarantees from desperate central bankers. They will literally see their debt

service exceed government revenues and they will have no choice but to default and restructure.

Kyle Bass (Hayman Advisors), Value Investor Insight (2010)

WHYMACRO?


& Process

Investment Themes &

Outlook


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INVESTMENT PHILOSOPHY& PROCESS


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Bienville Capital

Partners, LP

Bienville Capital

Management, LLC

GLOBAL MACRO RESEARCH & ANALYSIS

Intense research process to assess opportunities and risks across asset classes and geographies

Fundamental in nature

Focus on foreseeable events (i.e. grey swans)

ASSETALLOCATION

Determine the risk-reward opportunities and optimal allocation among asset classes and

fundamentally-oriented investment strategies Avoid over-valued asset classes

MANAGERSELECTION PHILOSOPHY& PROCESS

Select a concentrated group of managers with superior investment skill after conducting an intense

review of their investment strategy, process, philosophy and organization

Focus on managers who concentrate their best ideas and align interests with investors

Avoid large institutions , as well as quantitative, arbitrage, relative value, multi-strategy and other

strategies reliant on leverage or multiple portfolio managers

PORTFOLIO CONSTRUCTION

Develop a deep understanding of each managers style, philosophy, volatility, market correlation and

cross correlation to determine optimal allocation

Overlay hedging in order to efficiently alter risk exposures

Cheap insurance

Why Macro?


& Process

Investment Themes &

Outlook


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Bienville Capital

Partners, LP

Bienville Capital

Management, LLC

GLOBAL MACRO RESEARCH & ANALYSIS

Serves as the foundation for portfolio construction

Rigorous assessment of the macroeconomic landscape and geopolitical environment

Focus on global imbalances and potential sources of volatility

Development of long-term, structural themes coupled with short-term, tactical views

Utilize extensive network of industry professionals, economists and strategists for idea generation

STRATEGYALLOCATION

Long-Short Equity: Focus on value-oriented managers who concentrate their long portfolio in

securities believed to be trading at a discount to intrinsic value while shorting fundamentally-flawed

securities perceived to be overvalued. The short book provides an additional source of return while

reducing overall market risk

Credit & Distressed: Event-driven, value-oriented strategy focusing on complex situations around

corporate capital structures

Fundamental Macro: Independent thinkers employing rigorous fundamental macroeconomic researchin attempt to identify asymmetric return opportunities in periods of volatility and dislocation, thereby

providing valuable portfolio diversification benefits

Tactical Overlay: Utilized when necessary to hedge overall portfolio risk or to tactically adjust

exposures


& Process

Why Macro?

Investment Themes &

Outlook


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Bienville Capital

Partners, LP

Bienville Capital

Management, LLC

MANAGERSELECTION PHILOSOPHY

Alignment of Interests - Ensure managers have meaningful financial commitments in their respective

funds, thereby aligning interests with all investors

Investment Strategy and Philosophy Definable and repeatable strategy combined with a

fundamental, value investing philosophy

Investment Process - Evaluate whether the managers investment process is repeatable and based on

both superior research skills and analytical ability

People & Organization - Interview key decision makers and assess the infrastructure, policies and

procedures of the underlying managers organization

Performance - History of superior performance consistent with objectives. Focus on quality of

returns, downside protection and correlation, as well positioning in various market environments

MANAGERSELECTION PROCESS

Initial Call or Meeting - Discussion of strategy, process, performance history, team dynamics, risk

management, current opportunities and positioning

Initial Internal Review - Thorough review of notes, marketing materials, website, due diligence

questionnaires, previous investor letters in order to determine whether an on-site visit is warranted

On-Site Due Diligence Visit - Perform an onsite review of all aspects of the firm, including

personnel, investment process, performance, compliance, trading and terms of the partnership

Full Review with Investment Committee - Investment Strategy Memorandum and Due Diligence

Review reports are completed and reviewed by all members of the investment committee


& Process

Why Macro?

Investment Themes &

Outlook


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Bienville Capital

Partners, LP

Bienville Capital

Management, LLC

PORTFOLIO CONSTRUCTION & OVERLAY

Detailed quantitative analysis is combined with qualitative knowledge attained from in-depth

discussions and analysis

Manager philosophy, style, sector or capitalization preference are considered relative to each other

Correlations, cross-correlations and contribution to portfolio risk are assessed

MONITORING & RISKANALYSIS

Internal models to assess quantitative factors in conjunction with our fundamental and qualitative

understanding of manager positions

Assessment of individual themes, as well as holdings for underlying managers where position-level

detail is essential

Review aggregate portfolio exposures to ensure they are consistent with stated objectives

Analysis of returns, correlations and cross-correlations among managers

Concentrated nature of the partnership allows for intense focus on managers selected

Balance liquidity with opportunity


& Process

Why Macro?

Investment Themes &

Outlook


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Diversification across asset classes in paramount, however, due to increased correlations, focus should

also be on the best fundamental opportunities while avoiding unattractive and overvalued asset classes...

Bienville Capital

Partners, LP

Bienville Capital

Management, LLC


& Process

Why Macro?

Investment Themes &

Outlook

Cash, 5.0% Investment GradeBonds, 10.0%

Enhanced FixedIncome, 7.0%

TIPS,3.0%

Public Equities,

25.0%Gold , 15.0%

Foreign Currency,10.0%

Hedge Funds,25.0%

SAMPLE PORTFOLIO


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Throughout 2010, tactical adjustments have largely been focused on three assets classes: foreign

currency, gold and enhanced fixed income

Bienville Capital

Partners, LP

Bienville Capital

Management, LLC


& Process

Why Macro?

Investment Themes &

Outlook

Cash, 5.0%Investment Grade

Bonds, 10.0%


TIPS, 3.0%

Public Equities,

25.0%Gold , 15.0%

ForeignCurrency, 10.0%

Hedge Funds,25.0%

TACTICAL PORTFOLIO


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Focus on long volatility assets and strategies. High quality fixed income and cash can serve as portfolio

stabilizers while hedge funds and foreign currency may be used to capitalize on dislocations

Bienville Capital

Partners, LP

Bienville Capital

Management, LLC


& Process

Why Macro?

Investment Themes &

Outlook

Cash, 5.0%

Investment GradeBonds, 10.0%


TIPS,3.0%

Public Equities,

25.0%Gold , 15.0%


Hedge Funds,25.0%

VOLATILITYREDUCTION


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In a deleveraging scenario, deflationary pressures are intense. Cash, bonds and gold typically perform

well. Tactical use of foreign currency can assist in protecting against a strong US dollar rally

Bienville Capital

Partners, LP

Bienville Capital

Management, LLC


& Process

Why Macro?

Investment Themes &

Outlook

Cash, 5.0%Investment Grade

Bonds, 10.0%


TIPS, 3.0%

Public Equities,

25.0%Gold , 15.0%


Hedge Funds,25.0%

DEFLATION PROTECTION


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Bienville focuses on strategies that are fundamental in nature where intense research can unlock

opportunities. Long-short equity, macro and event-driven strategies have outperformed

Bienville Capital

Partners, LP

Bienville Capital

Management, LLC

Risk / ReturnJanuary 1991 - October 2010 (Single Computation)

Return

0%

2%

4%

6%

8%

10%

12%

14%

16%

Standard De viation

0% 5% 10% 15% 20% 25%

HFRI Event-Driven (Total) In dex

HFRI Equity Hedge (Total) I ndex

HFRI Macro (Total) Index

MSCI EAFE

MSCI EM (EMERGING MARKETS)

S&P GSCI

Barclays Capital U .S. A ggregate

BofA Merrill Lynch Municipals, 3-7yr

Market Benchmark:S&P 500

Equity Hedge, Event-Driven and Macro have

delivered higher returns with less volatility


& Process

Why Macro?

Investment Themes &

Outlook


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In volatile markets, protecting capital is essential for wealth preservation and accumulation

Bienville Capital

Partners, LP

Bienville Capital

Management, LLC


& Process

Why Macro?

Investment Themes &

Outlook


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Bienville Capital

Partners, LP

Bienville Capital

Management, LLC

THE BIENVILLE MACROVIEWBroad assessment of global opportunities, imbalances and risks across asset classes and geographies

Goldman SachsJP Morgan

Societe Generale

Deutsche Bank

CLSA

Jefferies

Financial Times

Wall Street Journal

New York Times

The Economist

Capital EconomicsISI

Strategas

The Gartman Letter

Ed Yardeni

Grants

David Rosenberg

Ned Davis Research

Lombard Street Research

Bloomberg

Trim Tabs Research

Manager Proprietary Research

Federal ReserveCongressional Budget Office (CBO)

International Monetary Fund (IMF)

U.S. Bureau of Economic Analysis (BEA)

Bank of International Settlements (BIS)

OECD

News & Periodicals

Wall Street Research Independent Research Proprietary, Internal Research

GDP, Inflation, Interest Rates, CommodityPrices, Credit Spreads, CDS, Political & Social

Factors, Fiscal & Monetary Policy, Currency,Money Supply & Credit Creation, Equity

Prices, PE Multiples, Psychology, Volatility

Proprietary, Internal Research


& Process

Why Macro?

Investment Themes &

Outlook


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INVESTMENTTHEMES & OUTLOOK

I have yet to see any problem, however complicated, which, when looked at the right way did not become still more complicated.

- Poul Anderson, author


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INVESTMENT OUTLOOK

Investment Themes &

Outlook

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

CORE INVESTMENTTHEMES

Unraveling of the multi-decade credit bubble

Secular deleveraging of the private sector in developed economies resulting from excessive

debt

Sovereign discredit

Oscillating volatility paradigm, increased correlation across asset classes

High-quality versus low-quality equities

Global fiscal and monetary policy divergence, protectionism

Monetary instabilityWhy Macro?


& Process


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

UNRAVELING OF THE CREDIT BUBBLE

Unchartered territory. As Irving Fisher explained, major disturbances in economic cyclesoccur from too much debt relative to GDP

Source: Hoisington

Why Macro?


& Process

Investment Themes &

Outlook


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

UNRAVELING OF THE CREDIT BUBBLE

Shuffling the deck chairs aroundHouseholds are beginning the necessary deleveragingwhile the government ramped up to socialize losses

Source: Federal Reserve Flow of Funds

Rapid accumulation of debt

Early stages of deleveraging Transfer of bad private debts to the public sector

Why Macro?


& Process

Investment Themes &

Outlook


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

SOVEREIGN CREDIT

Sovereign credit will remain a critical issueand one of insolvency, not liquidity

Source: GMO

Why Macro?


& Process

Investment Themes &

Outlook


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

DELEVERAGING & GLOBAL REBALANCING

The sum of financial flows in an economy must equal zero. Therefore, one sectors financialbalance cannot be viewed in isolation as its effects will be felt elsewhere

Sectoral financial balancesthat is, how much a sector borrows or savesrepresents aflow over time. Contrarily, balances show how much a sector owes (or is owed) andrepresents a stock at a moment in time. For example, the US government gross debt-to-GDP is ~85%. This is the stock of debt

Because the public sector is currently in deficit, the private sector and the foreign capitalaccount must, by definition, be in surplus. They are providing the funding to the public sector

Why Macro?


& Process

Investment Themes &

Outlook

PUBLIC SECTOR + PRIVATE SECTOR + CURRENTACCOUNT = 0

Source: Lombard Street Research; Bloomberg, Bienville Capital Management, LLC,

-10.0% + 7.0% + 3.0% = 0

HOUSEHOLDS

2.0%BUSINESSES

5.0%

CURRENT US SECTORAL FINANCIAL BALANCE


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP


By analyzing sectoral balances, it is clear that it is a mathematical impossibility for both thepublic and private sector to delever without the trade deficit swinging towards balance

Since the government sector debt-to-GDP will soon reach 100%, in order to stabilize theratio, the annual budget deficit cannot exceed nominal GDP growth, which is estimated tobe 3.0%. In fact, budget deficits are being targeted to 3.0% (see CBO projections)

Normal private sector surpluses are 4.0% (3.0% for households and 1.0% for businesses).For that to occur, the current account needs to be in balance. This natural tendencytowards equilibrium is in contrast with Chinas policy and the currency regime in place

Why Macro?


& Process

Investment Themes &

Outlook

PUBLIC SECTOR + PRIVATE SECTOR + CURRENTACCOUNT = 0


-3.0% + 4.0% + -1.0% = 0

HOUSEHOLDS

3.0%BUSINESSES

1.0%

SUSTAINABLE US SECTORAL FINANCIAL BALANCE


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP


When looking at the flows between sectors, imbalances become obvious

For the Government sector to reduce its annual deficits, the Foreign account must falltowards zero. However, the Chinese yuan peg is preventing it from occurring

Why Macro?


& Process

Investment Themes &

Outlook



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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

JAPAN WHEN, NOT IF

Equity and land prices burst over 20 years ago and remain at substantially lower levels.

Why Macro?


& Process

Investment Themes &

OutlookSource: Capital Economics


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

JAPAN WHEN, NOT IF

Rather than restructuring private debts, losses were socialized. Debt-to-GDP is now higherthan any country in the developed world.

Why Macro?


& Process

Investment Themes &

Outlook

Source: Capital Economics


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

JAPAN WHEN, NOT IF

When credit grows faster than the economy, trouble always ensues.

Why Macro?


& Process

Investment Themes &

Outlook

FY 2010 (Initial) in Yen

Tax Revenues 37,396

Social Security Expenditures (27,269)

Interest Expense* (9,800)

Surplus to Fund other Budget Items 327

Source: Japan Ministry of Finance


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

CHINA THE NEXT CREDIT CRISIS?

Net capital inflows have been expanded into the money supply through bank loans

Why Macro?


& Process

Investment Themes &

Outlook

Source: Independent Strategy


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

Why Macro?


& Process

Investment Themes &

Outlook


The bank loans have driven enormous investments into capacity, much of it unnecessary

Despite widespread belief, investment in fixed assets drives economic growth


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

Why Macro?


& Process

Investment Themes &

Outlook


What distinguishes China from other emerging markets is the intensity and duration of itsfixed asset investment cycle. No country has maintained a ratio over 35% of GDP for as long

However, the trend is unsustainable as efficiency of investment deteriorates


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

Why Macro?


& Process

Investment Themes &

Outlook


When credit grows faster than the economy, capital is grossly misallocated. Trouble alwaysensues

Booms can quickly turn to busts


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

Why Macro?


& Process

Investment Themes &

Outlook

(in RMB) (in USD)

M1 24,100 3,601 1,757 205%

M2 67,400 10,072 8,704 116%

GDP 34,051 5,088 14,579 35%

M1 / GDP 71% 12% 587%

M2 / GDP 198% 60% 332%

Source: Bloomberg

China as % of

US

China United States

(in USD)


Net capital inflows have been expanded into the money supply through bank loans

Despite Chinas economy being a third of the size of the US, its money supply is nearly 20%larger


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CONFIDENTIAL

INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

OSCILLATINGVOLATILITY

Excessive debt globally has lead to a new volatility regime

Source: Bienville Capital Management, Bloomberg

0

10

20

30

40

50

60

70

80

90

Jun-04 Jan-05 Aug-05 Mar-06 Oct-06 May-07 Dec-07 Jul-08 Feb-09 Sep-09 Apr-10

VIX Index

Why Macro?


& Process

Investment Themes &

Outlook


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP


Weve seen this movie beforea lot of volatility but no gains


500

600

700

800

900

1,000

1,100

Dec-67 Nov-69 Nov-71 Nov-73 Nov-75 Nov-77 Nov-79 Nov-81

Dow Jones Industrial Average (1967 -1982)

-30%

-15%

-40%

-26%

-15%

+37%

+23%+65% +35%

Why Macro?


& Process

Investment Themes &

Outlook


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CONFIDENTIAL

-14%

INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP


There has to be a better way


Why Macro?


& Process

Investment Themes &

Outlook

600

800

1,000

1,200

1,400

1,600

Jun-00 Jun-01 Jun-02 Jun-03 Jun-04 Jun-05 Jun-06 Jun-07 Jun-08 Jun-09 Jun-10

S&P 500 (Trailing 10 Years)

+83%

-47%

+95%

-57%


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP Attractive uncorrelated spread to be captured via

long high-quality, short low-quality

Why Macro?


& Process

Investment Themes &

Outlook


Stay hedged, focusing on high quality versus low quality


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CONFIDENTIAL

INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP


Why Macro?


& Process

Investment Themes &

Outlook0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10

US Government 10-Year Yield

Penn Square Bank Failure

Continental Illinois Failure

87 Crash

S&L Crisis / Gulf War I

Mexican Peso Crisis

Russia Default / LTCM Failure

Dot.com Bust

9-11 Subprime Credit Crisis

POLICYRESPONSE

US Treasury yields have been falling for nearly 30 years as policymakers respondedasymmetrically to financial market crises


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CONFIDENTIAL

INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP


Why Macro?


& Process

Investment Themes &

Outlook

$-

$500,000

$1,000,000

$1,500,000

$2,000,000

$2,500,000

94 97 00 03 06 09

Federal Reserve Bank Total Assets

POLICYRESPONSE

With no more room to cut rates, the Fed is targeting its balance sheet. How far will they go?


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CONFIDENTIAL

INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

Why Macro?


& Process

Investment Themes &

Outlook

Contraction

Cycle Peak Cycle Trough in GDP Length Monetary Fiscal Total

August 1929 March 1933 -27.0% 43 3.4% 4.9% 8.3%

May 1937 June 1938 -3.4% 13 0.0% 2.2% 2.2%November 1948 October 1949 -1.7% 11 -2.2% 5.5% 3.3%

July 1953 May 1954 -2.7% 10 - -1.4% -1.4%

August 1957 April 1958 -3.2% 8 - 3.2% 3.2%

April 1960 February 1961 -1.0% 10 0.7% 1.0% 1.7%

December 1969 November 1970 -0.2% 11 0.3% 2.4% 2.7%

November 1973 March 1975 -3.1% 16 0.9% 3.1% 4.0%

January 1980 July 1980 -2.2% 6 0.4% 1.1% 1.5%

July 1981 November 1982 -2.6% 16 0.3% 3.5% 3.8%July 1990 March 1991 -1.3% 8 1.0% 1.8% 2.8%

March 2001 November 2001 -0.2% 8 1.3% 5.9% 7.2%

December 2007 June 2009 -4.1% 18 22.1% 11.9% 31.0%

Stimulus as % of GDP

Source: Blackstone; Alan S. Blinder; Mark Zandi; The National Bureau of Economic Research; Lombard Street Research;Bienville Capital Management, LLC estimates

POLICYRESPONSE

By all measures, the policy reaction to the Great Recession was inconceivablydisproportionate, currently running at an estimated 30% of GDP


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CONFIDENTIAL

INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

MONETARYINSTABILITY

Gold is telling us something about the viability of the current monetary framework


Why Macro?


& Process

Investment Themes &

Outlook0

200

400

600

800

1,000

1,200

1,400

1,600

01 02 03 04 05 06 07 08 09 10

Gold (in USD)


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INVESTMENT OUTLOOK

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

MONETARYINSTABILITY

Faced with these confusing and competing considerations, Von Havenstein decided to play fortime, supplying the government with whatever money it needed. Contrary to popular myth, hewas perfectly aware that printing money to finance the deficit would bring inflation. But hehoped that it would be modest, and that in the meantime, something would turn up to inducethe Allies to lower their demands or at least agree to a moratorium on actual payments, givingGermany some breathing space.

It was a total miscalculation. Von Havenstein failed to recognize that experimenting with thecurrency was like a knife-edge. A moderate degree of inflation does not remain moderate forlong. At some point the public loses confidence in the authoritys power to maintain the valueof money, and deserts the currency in panic. Germany passed this tipping point in the middleof 1921.

Instead of admitting that he had made a terrible mistake, Von Havenstein, with his doggedPrussian sense of duty, dug in his heels, refusing to change any of his policies and continuingto print as much money as the government needed.

- Liaquat Ahamed, Lords of Finance

Why Macro?


& Process

Investment Themes &

Outlook


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INVESTMENT OUTLOOK

Hedged equity exposure exploiting the attractive spread between high-quality and low-

quality securities while reducing correlation to broad indices

Event-driven and special situations in credit and distressed debt markets

Thematic macro exposure to capitalize on oscillations in volatility and battle between

intensifying deflationary pressures and reflationary policy response

Physical gold and gold-related equities, foreign currency to protect from monetary

instability

Protection against a sovereign credit crises focused on Europe and Japan

Flexibility!

Bienville Capital

Management, LLC

Bienville Capital

Partners, LP

SUMMARY AND POSITIONING

Why Macro?


& Process

Investment Themes &

Outlook


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APPENDICES


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BIOGRAPHIES

M. Cullen Thompson, CFA

Managing Partner, CIO

Co-Founder, Bienville Capital Management, LLC

Previously:

Director of Investments, RR Advisory Group, LLC

Senior Research Analyst, Citigroup Private Bank

Senior Portfolio Analyst, Lehman Brothers Trust Co.

Associate , Arthur Anderson LLP

BA University of Alabama

Donald Stoltz III

Partner

Director of Trading & COO, Bienville Capital Management,

LLCPreviously:

Proprietary Trader, First New York Securities, LLC

Vice President, JPMorgan Chase & Co.

BA Pennsylvania State University

William H. Stimpson II

Managing Partner, CEO


Previously:

Managing Director , Bay Crest Securities, LLCExecutive Director, JPMorgan Chase & Co.

Vice President, Deutsche Bank

BA Vanderbilt University

Shruti Bansal, CFA

Director

Manager Due Diligence, Bienville Capital Management, LLC

Previously:

Head of Research, SCS FinancialVice President, Atlantic Trust

Senior Analyst, Muirfield Capital Management

Portfolio Manager, Lehman Brothers

BA Montclair State University

Ralph F. Reynolds

Partner, Senior Advisor


Previously:

Founder and CIO, Carlyle Blue Wave

Managing Director, Deutsche Bank

President & CEO, NatWest

Managing Director, Morgan Stanley

Principal, OConnor and Associates

MBA University of Chicago

BA University of Pennsylvania

Edward B. Meyercord

Senior Advisor

Senior Advisor, Bienville Capital Management, LLC

Previously:

Director, Stralem & Company

Partner, Eagle Capital Management

Executive, Hillcrest Partners

Executive, Altiva Financial Corporation

Executive, Mclean Securities

Executive, XM Partners

BA Birmingham Southern College


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FIRM AND CONTACT INFORMATION

Bienville Capital Management, LLC is an SEC-registered, independent investment advisory firm offering sophisticated and customized

investment solutions to high-net-worth and institutional investors.

The members of the Bienville team have broad and complementary expertise in the investment business, including over 100 years of

collective experience in private wealth management, institutional investment management, trading, investment banking and private

equity. We have established a performance-driven culture focused on delivering exceptional advice and service to a select number of

investors. We communicate candidly and frequently with our clients in order to articulate our views.

Our clients include high-net-worth families and single family offices with complex needs.

Bienville Capital Management has offices in New York, NY and Mobile, AL.

New York Bienville Capital Management, LLC

32 Avenue of the Americas, Ste 2100

New York, NY 10013

Phone: 212.226.7348

Alabama Bienville Capital Management, LLC

64 North Royal Street

Mobile, AL 36602

Phone: 251.445.8139

Email Cullen Thompson

[email protected]

Donald Stoltz

[email protected]

www.bienvillecapital.com


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CONFIDENTIAL

DISCLAIMER

Bienville Capital Partners, LP (the Fund) is offered in reliance upon an exemption from registration under the U.S. Securities Act of 1933, as amended, foroffers and sales of securities that do not involve a public offering. This document is not intended to be, nor should it be construed or used as, an offer to sell ora solicitation of any offer to buy securities of the Fund. No offer or solicitation may be made prior to the delivery of the Confidential Private OfferingMemorandum of the Fund (the Memorandum). Securities of the Fund shall not be offered or sold in any jurisdiction in which such offer, solicitation or sale

would be unlawful until the requirements of the laws of such jurisdiction have been satisfied. No public or other market is available or is likely to develop forsecurities of the Fund. Furthermore, securities of the Fund have limited withdrawal rights and are not transferable without the prior written consent ofBienville Capital GP, LLC (the "General Partner"). Accordingly, an investment in the Fund is a relatively illiquid investment.

This document is confidential, intended only for the person to whom it has been provided, and under no circumstance may be shown, transmitted or otherwiseprovided to any person other than the authorized recipient. While all information in this document is believed to be accurate, the General Partner makes noexpress warranty as to its completeness or accuracy and is not responsible for errors in the document. Furthermore, the information is furnished as of the dateshown or cited, and the General Partner does not undertake any responsibility for updating the information herein. This document is provided forinformational purposes only, does not contain all material information about the Fund is subject to change without notice. Furthermore, estimates, investment

strategies and views expressed in this document are based upon current market conditions and/or may be based on information provided by unaffiliated thirdparties.

In making an investment decision, investors must rely on their own examination of the Fund and the terms of the offering, including, but not limited to, themerits and risks involved. The interests of the Fund have not been recommended by any federal or state securities commission or regulatory authority.Furthermore, the foregoing authorities have not confirmed the accuracy or determined the adequacy of this presentation. Any representation to the contrary isa criminal offense.

The information contained herein does not take into account the particular objectives or circumstances of any specific prospective investor and should not beconstrued as accounting, legal, tax or investment advice. Prospective investors should consult their tax, legal, accounting or other advisors about the mattersdiscussed herein. An investment in the Fund may not be suitable for all investors and eligibility criteria will apply. No person has been authorized to give any

information or to make any representation, warranty, statement or assurance not contained in the Memorandum and any such information may not be reliedupon.

This document contains information about the Funds investment objective, programs, guidelines and restrictions. Material economic conditions, market forces,and other factors may cause the Fund to adjust such objective, programs, guidelines and restrictions as necessary. No guarantee or representation is made thatthe Funds investment programs, including, without limitation, its investment objectives, diversification strategies or risk management goals, will be successful,and investment results may vary substantially over time.

AN INVESTMENT IN THE FUND IS A SPECULATIVE INVESTMENT, INVOLVES SIGNIFICANT RISKS AND IS SUITABLE ONLY FORTHOSE PERSONS WHO CAN BEAR THE ECONOMIC RISK OF THE LOSS OF THEIR ENTIRE INVESTMENT AND WHO HAVE A LIMITEDNEED FOR LIQUIDITY. THERE CAN BE NO ASSURANCE THAT THE FUND WILL ACHIEVE ITS INVESTMENT OBJECTIVE.

Bienville Capital Managment - Presentation (December 2010)

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