Charts March 27

March 26, 2010
United States: Portfolio Strategy
US Weekly Kickstart
Dividend announcements suggest a move to more conventional capital spending policy
71 companies have raised their dividends and ten firms have initiated payouts YTD,
a 50% increase vs. 1Q 2009. The average boost was 13%. Two firms cut dividends.
We forecast S&P 500 dividends will rise by 2% in 2010. We expect dividend tax rates
will reach 29% by 2013 (including 3.8% Medicare surcharge). Dividend swap prices
do not reflect concern that higher taxes will discourage future dividend growth.
Performance Sector views and performance

David J. Kostin
The S&P 500 was flat for the week. Energy Our recommended sector weightings have
(212) 902-6781 david.kostin@gs.com
continued to underperform, down 3.0% while generated -13 bps of alpha YTD. We have lost the Goldman Sachs & Co.
Financials was the best sector, up 1.2%. We most ground in our overweight Energy position
Amanda Sneider
expect the S&P 500 to rise to 1300 by mid-year (-19 bps) and generated the most positive alpha in
(212) 357-9860 amanda.sneider@gs.com
(+12%), before ending 2010 at 1250 (+7%). our underweight position in Utilities (+18 bps). Goldman Sachs & Co.
S&P 500 Earnings US Portfolio Strategy baskets Caesar Maasry

Our top-down EPS forecasts of $76 and $90 for Our recommended High Sharpe Ratio trade (Long (212) 902-9693 caesar.maasry@gs.com
Goldman Sachs & Co.
2010 and 2011 reflect +33% and +20% growth, <GSTHSHRP> / Short S&P 500) was down 0.6% for
respectively. Our pre-provision and write-down the week. Our Dividend Growth basket Nicole Fox
EPS forecasts are $81 for 2010 and $91 for 2011. (<GSTHDIVG>) fell 0.6% for the week. (212) 357-1744 nicole.fox@gs.com
Goldman Sachs & Co.
Bottom-up consensus forecasts a 38% increase in
2010 to $79, and a 20% increase in 2011 to $95.
S&P 500 stock performance this week
Leaders: TIE, LEN, NVLS, CLF, VIA.B
Valuation Laggards: GENZ, CNX, BHI, NBR, BJS
Top-down the S&P 500 trades at an NTM P/E of
15.2X (14.2X on pre-provision EPS). Bottom-up, it
Inaugural Goldman Sachs BRICs Conference
May 11-12, 2010 - The Landmark, London
trades at an NTM P/E of 14.8X and LTM P/B of
Please visit the conference website for details.
2.4X.
http://www.gs.com/events/embric2010/attendee.
The Goldman Sachs Group, Inc. does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that
could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. For Reg AC certification, see the end of the text. Other
important disclosures follow the Reg AC certification, or go to www.gs.com/research/hedge.html. Analysts employed by non-US affiliates are not registered/qualified as research analysts with FINRA in
the U.S.
The Goldman Sachs Group, Inc. Goldman Sachs Global Economics, Commodities and Strategy Research
March 26, 2010 United States: Portfolio Strategy
The conversations we are having with clients: Market outlook and dividend policy
The S&P 500 touched 1180 this week, up nearly 6% since the start of 2010, (SUN), the only other S&P 500 company in the subsector, announced a 50%
before retreating to about 1165 at week’s end. We expect the S&P 500 to cut to its 2010 dividend late last year.
trade towards 1300 (roughly 12% above current levels) before retreating to
Tax increases are inevitable with US debt/GDP ratio forecast to rise from
1250 at year-end. Within US equities, we forecast globally-exposed cyclical
84% in 2009 to 94% in 2010 and annual budget deficits projected for at least
sectors (Information Technology, Energy, and Materials) will lead the market
the next decade. Current proposals would increase the capital gains and
higher as investors focus on sales, earnings, and valuation.
dividend tax rate to 20% from 15% at the start of 2011. Our economics team
Positive micro data points continue to accumulate in support of our assumes this rate will likely end up closer to 25% for budgetary reasons and
market outlook for the US equity market. We highlight two below: will approach 29% including the 3.8% Medicare surcharge (see Exhibit 1).
(See US Economics Daily, “Tax Increases on the Horizon” March 24, 2010).
1. QUALCOMM (QCOM, Buy) pre-announced that during fiscal 2Q it
would ship about 2.5 million (3%) more handsets, generate revenues We expect a 2.0% dividend yield and a 1.7% tax-adjusted dividend yield
roughly $100 million (4%) higher, and post GAAP EPS 16% above previous for the S&P 500 in 2010. Assuming the dividend yield on the market remains
guidance levels. The share price jumped 6% on the news. constant (i.e., equity appreciation matches dividend growth) then the after-
tax dividend yield on S&P 500 would equal 1.5% in 2011 and 2012 and fall to
2. US RevPAR growth turned from negative to positive over the past
1.4% in 2013 and beyond (see Exhibit 2). Dividend yields would be lower if
three weeks. Our Hotels & Lodging analyst Steve Kent notes that the recent
stock prices rise faster than dividend growth but yields would be higher if
move to positive RevPAR (Revenue per Available Room) has been driven
EPS growth accelerates and/or payout ratios increase from current levels.
mostly by increasing occupancy, especially in the upscale and above
segments. The overall domestic hotel industry has experienced occupancy We forecast S&P 500 operating EPS of $76 and DPS of $22.94 for 2010.
gains and we expect year/year growth in ADR (average daily rate) will occur Our operating EPS estimate represents a 33% increase from 2009E EPS of
during the next two quarters. $57. Adjusting for the provisions and write-downs for Financials, our
earnings estimates are $72 and $81, reflecting annual growth of 13%. Our
Dividends moved to the center of client conversations after the passage
S&P 500 dividend per share estimate of $22.94 represents a 2% increase
of the Health Care legislation. US non-Financial corporations sit on record
from the 2009 DPS of $22.41 (see Exhibit 3). On an operating basis, the
amounts of cash ($950 billion) and questions abound about how firms will
dividend payout ratio equals 39% in 2009 and 30% in 2010.
allocate funds among capital spending, M&A, buybacks, and dividends.
Dividend swap prices do not reflect concern that higher taxes will
Dividend announcements suggest a move to more conventional capital
discourage future dividend growth. While dividend growth expectations
spending policy. During the first three months of 2009, many firms left
for both 2011 and 2012 rose by more than 1% during the six weeks following
dividends unchanged and 46 firms cut or discontinued dividends. During the
4Q earnings season, the long-term growth priced into the dividend swap
same three-month period in 2010, 71 stocks increased dividends and ten
market was unchanged. We forecast dividend growth of 5.3% per year after
stocks initiated dividends. This represents almost a 50% increase in the
2012, above the dividend swap market’s current expectation of 3.6% annual
number of raises relative to the first three months of 2009 (81 versus 55).
growth (see Exhibit 4).
The average stock increased its dividend by 13% in 2010 versus 8% in 2009.
Ten firms announced share repurchase programs in conjunction with their Our dividend growth basket (Bloomberg ticker <GSTHDIVG>) consists of
dividend increases. 40 stocks that we forecast will have cash return on cash invested in 2011
roughly 2x the S&P 500 (4% vs. 2%) from a combination of both high
Only two stocks have cut dividends year-to-date. Valero Energy (VLO)
dividend yields and high dividend growth in 2010 and 2011 (see Exhibit 50).
slashed its dividend by 67% and Tesoro Corp. (TSO) discontinued dividend
YTD, 11 basket constituents increased their dividends by an average of 6%.
payments. Both are Energy stocks in the Oil & Gas Refining & Marketing
These stocks should outperform during the second-half of 2010 when we
subsector where refining margins have collapsed over the past year. Sunoco
expect the impact of fiscal stimulus fades and US economic activity slows.
Goldman Sachs Global Economics, Commodities and Strategy Research 2

The charts we are watching: A look back and look ahead at dividend policy and growth
Exhibit 1: Top dividend tax rate expected to rise to 28.8% in 2013 Exhibit 2: Effective dividend yield declines as tax rate increases
as of March 25, 2010 as of March 25, 2010
100 6%
GS Estimate
90 (includes 3.8%
Medicare surcharge) 5%
80
Top
70 Dividend 4% Dividend Yield
Tax Rate
Dividend Yield (%)

Tax Rate (%)
60
50 Long-Term 3%
Capital Gains 2.0%
40 Tax Rate 2.0%
2%
30 29%
20 1% 1.7% 1.4%
Effective Dividend Yield
10 15% (tax-adjusted)
0%
0
1960
1965
1970
1975
1980
1985
1990
1995
2000
2005
2010
2015
2020
2025
1960
1965
1970
1975
1980
1985
1990
1995
2000
2005
2010
2015
2020
2025
Source: Treasury Department. Source: Treasury Department, Compustat, and Goldman Sachs Global ECS Research.
Exhibit 3: Goldman Sachs top-down earnings and dividend estimates Exhibit 4: Dividend swap market pricing in faster near-term growth
Operating EPS DPS 8%

Dividend Growth Expectations
S&P 500 DPS growth (year over year)

2009E 2010E Growth 2009 2010E Growth 7% Goldman Sachs
Top-Down
Consumer Staples $9 $9 4% $3.69 $3.96 7% 6%
Dividend
Current
Information Technology 10 11 7 1.89 2.02 7
Consumer Discretionary 5 5 5 1.51 1.62 7 5%
Materials 1 2 69 0.71 0.74 4 Swap Market
4% Current
Utilities 3 3 15 1.75 1.82 4
Energy 5 10 93 2.70 2.79 3
3% Swap Market
Telecom Services 2 3 32 1.93 1.98 2 12-Feb-2010
Health Care 11 12 9 2.91 2.96 2 2%
Financials 4 12 251 2.42 2.38 (1)
2010E
2011E
2012E
2013E
2014E
2015E
2016E
2017E
2018E
2019E
2024E
Industrials 7 7 6 2.88 2.67 (7)
S&P 500 $57 $76 32 % $22.41 $22.94 2%
Source: Compustat and Goldman Sachs Global ECS Research. Source: Compustat and Goldman Sachs Global ECS Research.

S&P 500 Performance

Exhibit 5: S&P 500 sector performance over the last week Exhibit 6: S&P 500 price return and daily trading volume LTM
1,500 9
Financials 1.2
1,400 S&P 500 daily price level (lhs) 8
Cons Discretionary 1.2
1,300 7
Shares traded (billions)

Information Tech 0.6
S&P 500 Price Level

1,200 6
Consumer Staples 0.3
Industrials 0.2 1,100 5
Telecom Services 0.0 1,000 4
S&P 500 0.0 900 3

Health Care (0.4) 800 2
Materials (0.7) 700 1
S&P 500 daily trading volume (rhs)
Utilities (2.1) 600 0
25-Sep-08
25-Nov-08
25-Sep-09
25-Nov-09
25-Jan-09
25-Jan-10
25-Jul-08
25-Jul-09
25-May-08
25-May-09
25-Mar-08
25-Mar-09
25-Mar-10
Energy (3.0)
(4.0) (3.0) (2.0) (1.0) 0.0 1.0 2.0
1-week Total Return (%)
Source: FactSet, and Goldman Sachs Global ECS Research. Source: FactSet, and Goldman Sachs Global ECS Research.
Exhibit 7: S&P 500 sector performance over time Exhibit 8: BEST and WORST performing S&P 500 STOCKS BY SECTOR
Total Return Percentage Change (%) BEST STOCKS WORST STOCKS
1-Week 1-Month 3-Month 6-Month YTD 12-Month Return (%) Return (%)
Industrials 0% 8% 11 % 19 % 12 % 70 % Sector Ticker 1-week YTD Ticker 1-week YTD
Cons Discr LEN 9% 42 % DTV (4)% 0%
Financials 1 10 10 10 11 73
Consumer Staples WAG 4 (1) KR (4) 4
Cons Discretionary 1 8 9 23 11 69
Energy PXD 1 11 CNX (9) (14)
Consumer Staples 0 3 5 12 6 32
Financials HST 6 25 MS (4) (2)
Health Care (0) 3 2 14 3 35
Health Care AET 5 10 GENZ (11) 4
Information Tech 1 7 2 14 2 59
Industrials CAT 4 10 MMM (3) (1)
Materials (1) 6 0 11 1 51 NVLS JBL
Info Tech 8 8 (7) (5)
Energy (3) 1 (3) 4 (2) 20 Materials TIE 12 27 NEM (6) 2
Telecom Services 0 6 (5) 3 (4) 9 Telecom Services Q 5 27 AMT (4) (2)
Utilities (2) 1 (6) 3 (5) 19 Utilities SCG (0) 1 NRG (8) (14)
S&P 500 0% 6% 4% 13 % 5% 46 % S&P 500 TIE 12 % 27 % GENZ (11)% 4%

S&P 500 Performance (cont’d)

Exhibit 9: TOP 10 performing SUB-SECTORS over the last week Exhibit 10: BOTTOM 10 performing SUB-SECTORS over the last week
Consumer Electronics 5 Oil & Gas Refining & Marketing (4)

Semiconductor Equipment 4 Real Estate Services (4)
Hotels Resorts & Cruise Lines 4 Oil & Gas Exploration & Production (4)
Drug Retail 4 Paper Products (4)
Computer & Electronics Retail 4 Electronic Manufacturing Services (4)
Other Diversified Financial Services 4 IPP & Energy Traders (5)
Casinos & Gaming 4 Oil & Gas Drilling (5)
Commercial Printing 4 Gold (6)
Auto Parts & Equipment 3 Oil & Gas Equipment & Services (7)
Homebuilding 3 Coal & Consumable Fuels (7)
0 1 2 3 4 5 6
1-week Total Return (%) (8) (7) (6) (5) (4) (3) (2) (1) 0
1-week Total Return (%)
Exhibit 11: TOP 10 performing S&P 500 STOCKS over the last week Exhibit 12: BOTTOM 10 performing S&P 500 STOCKS over the last week
Return (%) Return (%)
Company Name Ticker Sector 1-week YTD Company Name Ticker Sector 1-week YTD
Titanium Metals TIE Materials 12 27 Genzyme Corp. GENZ Health Care (11) 4
Lennar Corp LEN Cons Discr 9 42 Consol Energy Inc. CNX Energy (9) (14)
Novellus Systems NVLS Info Tech 8 8 Baker Hughes BHI Energy (9) 11
Cliffs Natural CLF Materials 7 50 Nabors Industries Ltd. NBR Energy (9) (14)
Viacom Inc. VIA.B Cons Discr 6 12 BJ Services BJS Energy (8) 11
Host Hotels & Resorts Inc. HST Financials 6 25 NRG Energy NRG Utilities (8) (14)
Citigroup Inc. C Financials 6 29 Jabil Circuit JBL Info Tech (7) (5)
Starwood Hotels & Resorts HOT Cons Discr 6 23 Range Resources Corp RRC Energy (7) (8)
KLA-Tencor Corp. KLAC Info Tech 6 (14) Smith International Inc. SII Energy (7) 51
Wyndham Worldwide WYN Cons Discr 6 27 AES Corp. AES Utilities (7) (19)
S&P 500 Average (0) 7 S&P 500 Average (0) 7

Earnings and Sales

Exhibit 13: EARNINGS GROWTH: S&P 500 bottom-up consensus estimates Exhibit 14: SALES GROWTH: S&P 500 bottom-up consensus estimates
2010E Earnings Growth Annual 2010E Sales Growth Annual
1QE 2QE 3QE 4QE 2010E 2011E 1QE 2QE 3QE 4QE 2010E 2011E
Financials 561 257 181 173 238 47 Energy 48 38 30 24 34 14
Energy 1530 73 44 46 88 28
Materials 25 24 15 8 18 8
Materials 167 111 28 32 68 30
Information Technology 13 14 11 7 11 8
Consumer Discretionary 787 36 15 6 44 18
S&P 500 11 11 11 7 10 7
Information Technology 80 55 35 10 39 13
Health Care 5 6 9 5 6 4
S&P 500 70 38 30 26 38 20
Utilities 8 10 6 24 10 5 Consumer Staples 5 5 6 5 5 5
Consumer Staples 7 4 4 4 6 9 Consumer Discretionary 8 6 6 2 5 6
Health Care (4) 4 4 17 5 10 Industrials (3) 1 6 4 2 5
Industrials (5) (3) 22 4 4 19 Telecom Services 1 2 0 1 1 1
Telecom Services (11) (6) 3 12 (1) 9
S&P 500 (ex-Financials) 52 24 18 15 25 15
Exhibit 15: TOP-DOWN vs. BOTTOM-UP: Goldman Sachs vs. Consensus Exhibit 16: REVISIONS: S&P 500 consensus EPS revisions
Contribution to EPS Annual earnings growth rates 80
GS Top-Down EPS Bottom-up GS Top-Down Bottom-Up S&P 500 2010E EPS
2010E 2011E 2010E 2011E 2010E 2011E 2010E 2011E
79
Energy $10 $15 $10 $13 93 % 45 % 88 % 28 % Consensus
Materials 2 3 2 3 69 15 68 30 Bottom-Up
Telecom Services 3 3 2 2 32 1 (1) 9 78
$79
Consumer Discretionary 5 5 7 8 5 5 44 18
Utilities 3 4 3 4 15 1 10 5
Information Technology 11 12 14 16 7 10 39 13 77
Industrials 7 8 7 8 6 16 4 19
Health Care 12 13 12 13 9 4 5 10
76 Goldman
Consumer Staples 9 9 9 10 4 3 6 9 Sachs
S&P 500 ex-Financials 63 71 67 77 18 13 25 15 $76
Financials Operating EPS 12 19 12 17 251 54 238 47 75
S&P 500 Operating EPS $76 $90 $79 $95 32 % 20 % 38 % 20 %
31-Jan
31-Dec
28-Feb
31-Mar
30-Apr
+ Provisions & Writedowns 5 1 NA NA (63) (82) NA NA
S&P 500 EPS ex-P&W 81 91 NA NA 13 13 NA NA

Revisions
Exhibit 17: EARNINGS and SALES REVISIONS Exhibit 18: Stocks with the most POSITIVE and NEGATIVE EPS REVISIONS
Aggregate dollars % change, as of March 25, 2010 as of March 25, 2010
EPS REVISIONS SALES REVISIONS POSITIVE EPS REVISIONS NEGATIVE EPS REVISIONS
1 month 3 month 1 month 3 month 1 month 3 month 1 month 3 month
10E 11E 10E 11E 10E 11E 10E 11E Ticker Revis. Return Revis. Return Ticker Revis. Return Revis. Return
Materials 0.8 % (0.3)% 4.9 % 4.2 % 0.4 % 0.5 % 4.1 % 3.2 % X 613 % 17 % (63)% 10 % TSO (47)% 14 % (89)% 2%
Consumer Discretionary 0.6 0.3 6.9 4.3 0.2 0.5 1.8 1.4 TIE 51 36 24 24 MWW (40) 20 NM (3)
Information Technology 0.4 0.5 8.4 7.2 0.5 0.6 5.5 6.0
DHI 29 5 NM 17 GT (37) 4 (60) (10)
Industrials 0.2 0.6 2.7 3.1 0.2 0.1 1.0 1.5
LEN 23 11 55 35 AIG (31) 25 (13) 15
Health Care (0.0) 0.1 (0.4) (0.2) 0.1 (0.1) 1.0 0.9
ODP 18 16 63 14 DFS (26) 14 (28) 3
Consumer Staples (0.0) 0.1 0.1 (0.2) 0.0 (0.2) 0.8 1.1
MU 18 14 41 2 PHM (19) 9 13 14
S&P 500 (0.1) 0.1 2.1 1.3 0.2 0.3 1.7 0.2
AMD 17 14 64 (9) FHN (19) 10 NM 3
Energy (0.4) (0.1) 1.3 (0.8) 0.5 0.7 1.2 (6.1)
Utilities (0.5) (0.6) (1.5) (2.2) NM NM NM NM CMA 17 7 54 27 SUN (17) 10 (36) 12
Telecommunication Services (0.9) (0.6) (5.0) (5.9) 0.0 0.1 0.1 (0.0) WY 14 7 23 0 HIG (17) 14 (11) 18
Financials (0.9) 0.0 (1.3) (1.3) NM NM NM NM SNDK 12 23 92 16 STT (14) 2 (13) 2
S&P 500 (0)% 6% 2% 4% (0)% 6% 2% 4%
Source: FirstCall, I/B/E/S, FactSet, and Goldman Sachs Global ECS Research. Source: FirstCall, I/B/E/S, FactSet, and Goldman Sachs Global ECS Research.
Exhibit 19: S&P 500 1-Month Earnings Revisions Sentiment Exhibit 20: 1-Month Earnings Revision Sentiment by SECTOR
25 %
60% 30 %
20 %
S&P 500 1-Month 2010 EPS Revision Sentiment (lhs) 1-Month Earnings Revision Sentiment by Sector
40% [(# pos. revisions - # neg. revisions)/ total revisions] 20 % 15 % [(# pos. revisions - # neg. revisions)/ total revisions]
1-Month Revision Sentiment
S&P 500 Monthly % Return
10 %
Earnings Sentiment
20% 10 %
5%
0% 0% 0%
(5)%
(20)% (10)%
(10)%
Price Performance (rhs)
(15)%
(40)% (20)%
S&P 500
Materials
Info Tech
Energy
Telecom Services
Health Care
Utilities
Consumer Discr
Industrials
Consumer Staples
Financials
(60)% (30)%
Dec-05
Dec-06
Dec-07
Dec-08
Dec-09
Jun-06
Jun-07
Jun-08
Jun-09
Jun-10
Source: FirstCall, I/B/E/S, FactSet, and Goldman Sachs Global ECS Research. Source: FirstCall, I/B/E/S, FactSet, and Goldman Sachs Global ECS Research.

Valuation
Exhibit 21: Aggregate valuation metrics for S&P 500 and sectors Exhibit 22: Standard deviation vs. 10-year history (Z-Score)
bottom-up consensus valuation, as of March 25, 2010 bottom-up consensus, as of March 25, 2010
EV/ EV/ Price/ FCF PEG NTM EV/ EV/ Price/ FCF PEG Median
Sales EBITDA Book Yield Ratio P/E Sales EBITDA Book Yield P/E Ratio Z-Score
S&P 500 1.4x 8.7x 2.4x 6.3 % 1.4x 14.8x S&P 500 (0.8) (0.9) (0.8) (1.3) (0.7) 0.7 (0.8)
Industrials 1.9 11.6 2.9 7.2 1.7 17.4 Health Care (1.7) (1.6) (1.1) (0.7) (1.7) (0.5) (1.3)
Materials 1.5 10.1 2.9 5.0 1.7 17.1 Consumer Staples 1.0 (0.3) (0.7) (0.1) (0.8) (1.1) (0.5)
Consumer Discretionary 1.3 8.3 2.8 8.3 1.2 16.6 Telecommunication Services (1.2) (0.8) (0.1) (0.8) (0.1) 1.4 (0.5)
Financials NM NM 1.4 NM 2.0 16.1 Information Technology 0.1 (0.9) 0.9 (0.0) (1.3) (1.2) (0.4)
Information Technology 2.3 10.4 4.2 6.3 1.1 15.5 Utilities NM (0.5) (0.1) NM 0.1 1.3 (0.0)
Telecommunication Services 1.8 5.4 1.7 13.3 3.1 14.8 Consumer Discretionary 2.3 0.4 2.6 (1.4) (0.2) (0.7) 0.1
Consumer Staples 1.2 9.2 3.7 6.4 1.6 14.7 Energy (0.3) 1.6 (0.4) 1.3 1.2 (0.5) 0.4
Energy 1.0 7.4 2.0 1.2 1.0 12.5 Materials 1.1 0.8 1.5 0.6 0.7 0.1 0.8
Health Care 1.2 8.2 2.9 7.6 1.4 12.2 Industrials 0.8 1.2 1.5 0.7 2.1 2.1 1.3
Utilities NM 6.9 1.5 2.8 2.7 11.8 Financials NM NM (1.0) NM 1.3 2.2 1.3
Source: Compustat, FirstCall via FactSet, and Goldman Sachs Global ECS Research. Source: Compustat, FirstCall via FactSet, and Goldman Sachs Global ECS Research.
Exhibit 23: Historical NTM P/E and LTM P/B values for the S&P 500 Exhibit 24: Top stocks by fastest 2010 earnings growth and lowest NTM P/E
aggregate bottom-up consensus valuation, as of March 25, 2010 by sector, as of March 25, 2010
GROWTH VALUE
6
Fastest EPS Growth (%) Lowest P/E (x)
5 P/B 2.4 Sector Ticker 2010E 2011E Ticker NTM Rel to SPX
LTM P/B (x)
4
3 Cons Discr CBS 88 20 GCI 8.0 0.5
2
1 10-yr rolling avg Consumer Staples WFMI 63 13 SVU 8.5 0.6
0 Energy HES 88 31 CHK 7.6 0.5
1/76 1/79 1/82 1/85 1/88 1/91 1/94 1/97 1/00 1/03 1/06 1/09
Financials HIG 75 22 AIG 7.5 0.5
30 Health Care THC 39 23 LLY 7.6 0.5
25 P/E
NTM P/E (x)
14.8 Industrials RHI 85 NM PBI 10.2 0.7

20
15 Info Tech ALTR 91 7 WDC 6.6 0.4
10 10-yr rolling avg
5 Materials IP 60 45 FCX 10.3 0.7
0 Telecom Services FTR 59 1 CTL 10.8 0.7
1/76 1/79 1/82 1/85 1/88 1/91 1/94 1/97 1/00 1/03 1/06 1/09
Utilities PPL 70 (2) PPL 8.1 0.5
Source: Compustat, FactSet, and Goldman Sachs Global ECS Research. Source: Compustat, FactSet, and Goldman Sachs Global ECS Research.

S&P 500 Factor Performance

Exhibit 25: S&P 500 factor return ranking for the week ended March 25, 2010 (a)
Last Week Spread (%) Performance Spread of Top Quintile Less Bottom Quintile (%)
Last Last Five Trading Days Last Last
(3) (2) (1) 0 1 2
Growth Metrics(b) Week 19-Mar 22-Mar 23-Mar 24-Mar 25-Mar Month Quarter
EBITDA Growth (1.3) (0.5) (0.1) (0.0) 0.1 (0.8) 1.2 (0.5)
EPS Growth (1.5) (0.6) 0.1 (0.0) 0.2 (1.1) 1.5 1.8
GROWTH (1.6) (0.7) (0.1) (0.0) 0.2 (1.0) 0.1 (0.4)
Sales Growth (1.6) (0.5) (0.3) (0.3) 0.4 (0.9) (0.7) (2.5)
(b)
Value Metrics
P/B 1.5 0.2 0.9 (0.1) (0.3) 0.9 2.9 5.8
EV/DACF 1.0 0.5 0.1 (0.8) 0.1 1.2 4.2 5.4
EV/EBITDA 0.7 0.1 0.1 (0.6) 0.2 0.9 5.1 4.2
VALUATION 0.5 (0.1) 0.4 (0.7) 0.4 0.4 5.8 6.8
P/E 0.1 (0.4) 0.5 (0.3) 0.3 (0.1) 5.3 6.0
P/div (0.2) (0.5) 0.7 (0.2) 0.2 (0.3) 2.0 1.9
EV/FCF (1.9) (0.2) (0.7) (0.4) 0.3 (1.0) (0.3) (1.9)
Profitability Metrics(b)
ROCE 1.3 0.2 0.6 0.2 (0.6) 0.9 (0.9) 2.7
ROE 1.1 0.5 0.3 0.1 (0.5) 0.7 (3.0) (1.6)
CROCI 0.9 0.3 0.4 0.1 (0.5) 0.6 (0.8) (0.1)
PROFITABILITY 0.6 0.3 0.3 0.1 (0.7) 0.7 (2.1) 0.7
(c)
Other Metrics
Short Interest Level 0.5 (0.9) 1.0 0.6 (0.0) (0.2) 6.2 6.9
Equity Capitalization 0.4 0.5 (0.5) (0.4) 0.3 0.5 (2.1) (2.1)
(a) Factor return analysis uses S&P 500 companies included in the Goldman Sachs Americas coverage universe with stock prices greater than $5 at the time of publication.
(b) Growth, Value and Profitability analysis is based on Goldman Sachs Investment Profile scores (“IP Scores”). Growth, value and profitability metrics are indexed based on composites of several methodologies to
determine the stocks percentile ranking within the region’s coverage universe. The precise calculation of each metric may vary depending on the fiscal year, industry and region but the standard approach is as
follows: Growth is a composite of next year’s estimate over current year’s estimate, e.g. EPS, EBITDA, Revenue. Return is a year one prospective aggregate of various return on capital measures, e.g. CROCI,
ROACE, and ROE. Multiple is a composite of one-year forward valuation ratios, e.g. P/E, dividend yield, EV/FCF, EV/EBITDA, EV/DACF, Price/Book.
(c) “Other metric” analysis based on current market prices and data sourced from NASDAQ and NYSE via FactSet.
Source: NASDAQ and NYSE via FactSet, IDC, and Goldman Sachs Global ECS Research.

Style and Size

Exhibit 26: Total return by style and size over time Exhibit 27: Total return by SECTOR for S&P 500 vs. Russell 2000
Total Return Percentage Change (%) Weight (%) 1-Week (% Return) YTD (% Return)
Sector SP500 R2000 SP500 R2000 ∆ (bps) SP500 R2000 ∆ (bps)
1-Week 1-Month 3-Month 6-Month YTD
Energy 11 5 (3) (5) 177 (2) 1 (280)
Large Cap vs. Small Cap Information Tech 19 18 1 (1) 173 2 7 (451)
S&P 500 0 6 4 13 5 Financials 17 21 1 0 92 11 12 (45)
Russell 2000 (0) 8 7 14 9 Materials 3 5 (1) (2) 88 1 5 (335)
Telecom Services 3 1 0 (1) 76 (4) (3) (121)
Large vs. Small (bps) 36 (201) (344) (139) (385)
Industrials 10 15 0 (0) 53 12 6 645
Cons Discretionary 10 14 1 1 44 11 18 (745)
Growth vs. Value Consumer Staples 11 3 0 0 (12) 6 8 (238)
Russell 1000 Growth (0) 5 3 14 4 Utilities 3 3 (2) (1) (79) (5) 2 (622)
Russell 1000 Value (0) 6 5 12 6 Health Care 12 14 (0) 1 (92) 3 9 (540)
Growth vs. Value (bps) 5 (86) (166) 192 (204) Index 100 100 0 (0) 36 5 9 (385)
Exhibit 28: GROWTH vs. VALUE relative performance over time Exhibit 29: LARGE CAP vs. SMALL CAP relative performance over time
Russell 1000 Growth vs. Value, as of March 25, 2010 S&P 500 vs. Russell, as of March 25, 2010
105
110
Value outperforming 103 S&P 500 outperforming
101
105
99
100 97
95
95 93
91
90 89
87
Growth outperforming Russell 2000 outperforming
85 85
Jan-08
Jul-08
Sep-08
Nov-08
Jan-09
Jul-09
Sep-09
Nov-09
Jan-10
Mar-08
May-08
Mar-09
May-09
Mar-10
May-10
Mar-08
May-08
Mar-09
May-09
Mar-10
May-10
Jan-08
Jul-08
Nov-08
Jan-09
Jul-09
Nov-09
Jan-10
Sep-08
Sep-09

Global Equity Market and Mutual Fund Performance

Exhibit 30: GLOBAL EQUITY MARKET performance over the past week Exhibit 31: US EQUITY MUTUAL FUND performance vs. benchmark
Avg. Total Return (%) Stdev No. of AUM

Mexico (Bolsa) 0 Lipper Indices 1-week YTD 1-Week YTD Funds $ bil
Germany (Dax) 0 Large-Cap Core Funds (0.1) 4.4 0.3 1.3 30 252
Korea (KOSPI) 0 Benchmark: S&P 500 0.0 5.0
U.S. (S&P 500) (0) Out / (Underperformance) (bps) (11) (63)
France (CAC 40) (0)
Large-Cap Growth Funds (0.2) 3.9 0.2 1.2 30 248
Australia (ASX 200) (0)
Benchmark: Russell 1000 Growth (0.0) 4.3
Europe (DJ Stoxx 600) (1)
Out / (Underperformance) (bps) (15) (36)
UK (FTSE 100) (1)
Large-Cap Value Funds (0.1) 5.2 0.3 1.3 30 224
Japan (Nikkei) (2)
Benchmark: Russell 1000 Value (0.1) 6.3
Spain (IBEX 35) (2)
Out / (Underperformance) (bps) (6) (119)
China (MSCI China) (2)
Small-Cap Core Funds (0.6) 7.4 0.5 2.4 29 NA
Brazil (Bovespa) (3)
Benchmark: Russell 2000 (0.4) 8.9
(3) (2) (1) 0 1 Out / (Underperformance) (bps) (20) (152)
% Weekly price change
Source: FactSet and Goldman Sachs Global ECS Research. Source: Lipper, Factset, and Goldman Sachs Global ECS Research.
Exhibit 32: GLOBAL EQUITY MARKET performance over time Exhibit 33: International and other MUTUAL FUND performance
Price Return (%) USD Avg. Total Return (%) Stdev No. of AUM
1-Week 1-Month 3-Month 2010 YTD 2009
Lipper Indices 1-week YTD 1-week YTD Funds $ bil
Mexico (Bolsa) 0 8 5 8 52 International Equity
U.S. (S&P 500) (0) 6 3 5 23 Global Funds (1) 2 0.5 2.0 30 181
Japan (Nikkei) (2) 3 2 3 16
International Funds (1) 0 0.4 2.3 30 378
Korea (KOSPI) 0 8 3 2 62
European Funds (1) (1) 0.6 2.9 10 18
Australia (ASX 200) (0) 10 5 2 69
Emerging Market Funds (1) 1 0.5 1.4 29 NA
UK (FTSE 100) (1) 6 (1) (2) 37
Europe (DJ Stoxx 600) (1) 7 (2) (3) 32 Real Estate and Natural Resources
Brazil (Bovespa) (3) 5 (1) (4) 144 Real Estate 1 11 0.3 1.3 30 37
China (MSCI China) (2) 4 (2) (4) 63 Natural Resource (4) (3) 0.7 1.2 9 NA
Germany (Dax) 0 9 (4) (4) 28 Fixed Income
France (CAC 40) (0) 8 (5) (5) 26 General U.S. Government Funds Index (1) 1 0.8 0.5 30 NA
Spain (IBEX 35) (2) 8 (14) (14) 34
A Rated Bond Funds Index (1) 2 0.4 0.8 29 NA
BBB Rated Funds Index (1) 2 0.8 1.4 30 NA
Average (1) 7 (1) (1) 49
Source: FactSet, and Goldman Sachs Global ECS Research. Source: Lipper, FactSet, and Goldman Sachs Global ECS Research.

ETF Analysis: Composition, Valuation, Growth and Ownership

Exhibit 34: Selected ETF analysis for the week ended March 25, 2010 (a) (b)
ETF Description Composition Performance (%) Valuation Growth (%) Ownership
Market Top Stocks as Valuation Short Median
(a)
Cap No. of % of ETF Price Change P/E P/B Div Sales Growth Earnings Growth Interest Hedge Fund
(c)
Sector / sub-sector Index ETF $ mil Stocks 1 5 10 1 Wk YTD NTM LTM Yield 2010 2011 2010 2011 Days Own (%)
S&P 500 SPX SPY 77,074 500 3 11 19 (0) 5 15 2.3 1.9 9 7 29 20 2.0 3.0
S&P 100 OEX OEF 2,678 100 5 17 30 0 4 14 2.4 2.0 11 7 29 21 1.5 1.8
Nasdaq-100 NDX QQQQ 20,314 100 16 34 46 0 5 17 3.9 0.7 14 9 23 15 1.9 3.3
Consumer Discretionary IXY XLY 1,883 81 7 27 45 1 10 17 2.5 1.4 3 6 29 18 2.8 4.0
Homebuilders SPHOME XHB 928 25 4 21 42 0 12 47 1.8 1.1 5 10 NM 133 3.3 4.0
Retail IRH RTH 360 18 20 57 82 1 7 16 2.9 1.6 5 5 10 14 1.8 3.0
Retail SPSIRETR XRT 997 62 2 9 17 1 8 16 2.6 0.9 5 5 16 15 2.7 6.7
Consumer Staples IXR XLP 2,442 41 16 46 66 0 5 15 3.4 2.9 4 5 8 9 2.5 2.0
Energy IXE XLE 5,742 40 18 47 62 (3) (2) 13 2.0 1.8 21 14 42 30 2.3 3.1
Clean Energy ECO PBW 663 54 3 15 29 (1) (11) NM 1.7 0.5 30 18 NM 265 4.0 4.0
Natural Resources SPGSSINR IGE 1,662 131 7 29 42 (4) (3) 14 2.0 1.5 22 13 39 31 2.3 4.1
Oil & Gas E&P SPSIOP XOP 340 33 3 16 32 (3) (1) 17 1.8 0.8 27 15 48 42 2.4 4.6
Oil Services OXH OIH 1,938 16 15 54 83 (6) (1) 14 1.9 0.7 4 12 (11) 24 2.5 3.7
Financials IXM XLF 6,823 79 10 43 58 1 11 16 1.3 1.0 NM NM 153 50 1.5 2.9
Banks BKX KBE 960 24 10 38 60 2 23 67 1.1 0.8 NM NM NM 423 1.0 3.6
Broker-Dealers DJSINV IAI 135 25 11 40 63 (1) 1 15 1.5 0.9 NM NM 225 27 1.6 4.0
Insurance KIX KIE 197 24 8 35 58 0 16 13 1.1 1.7 NM NM 96 45 1.6 4.2
Real Estate DJUSRE IYR 2,992 75 9 26 41 0 10 15 2.1 4.3 NM NM 0 6 4.0 2.9
Regional Banks KRX KRE 963 50 3 14 26 1 20 38 1.3 1.7 NM NM NM 152 7.9 2.7
REITs RMZ VNQ 5,768 97 10 28 44 1 11 16 2.0 3.9 NM NM (2) 6 4.1 2.6
Health Care IXV XLV 3,025 51 14 44 61 (0) 3 12 2.9 2.0 10 4 8 10 2.0 4.0
Biotech SPSIBI XBI 575 27 4 20 39 (0) 13 NM 5.7 0.0 16 19 30 NM 3.3 9.8
Pharmaceuticals IPH PPH 649 16 25 79 95 (0) 1 11 3.0 3.2 17 4 8 10 1.9 3.2
Industrials IXI XLI 2,992 58 13 35 51 0 11 17 3.0 2.1 4 6 11 19 2.5 1.9
Transportation TRAN IYT 443 20 12 43 70 (2) 6 22 2.4 1.7 8 8 104 35 2.7 3.5
Information Technology IXT XLK 4,776 83 10 40 63 1 1 15 3.4 1.5 9 6 22 13 1.7 3.1
Semiconductors SPGSTISM IGW 276 51 8 35 54 0 0 16 3.1 1.3 28 9 186 22 2.3 3.4
Semiconductors XSH SMH 739 18 24 67 87 0 (0) 14 3.3 2.0 26 8 148 17 1.6 2.9
Software SPGSTISO IGV 313 50 9 37 57 (1) 4 18 3.6 0.3 7 9 12 15 2.1 3.5
Telecom Services DJSTELT IYZ 604 30 19 51 73 (1) (1) 29 1.7 4.3 3 1 35 32 2.8 4.6
Materials IXB XLB 1,717 31 11 46 66 (1) 1 17 3.0 1.8 15 8 71 30 2.0 2.2
Gold Miners GDM GDX 5,362 31 16 50 72 (7) (7) 20 2.3 0.6 42 12 56 23 1.2 4.3
Metals & Mining SPSIMM XME 948 25 5 22 42 (3) 6 21 2.2 0.9 22 14 NM 76 1.8 4.6
Steel STEEL SLX 407 27 12 45 70 1 6 19 1.9 1.0 30 20 448 53 1.8 1.9
Utilities IXU XLU 3,239 36 8 33 54 (2) (6) 12 1.5 4.5 NM NM 2 5 2.8 2.0
(a) Performance of the underlying index.
(b) Valuation, growth and ownership metrics are bottom-up aggregations of consensus forecasts, except where noted.
(c) Hedge Fund ownership data based on 4Q 2009 13-F filings.
Source: Compustat, First Call, Lionshare via Factset, IDC, and Goldman Sachs Global ECS Research. See our Goldman Sachs ETF Bloomberg page <GETFG> or contact the desk at 1-888-ETF-DESK for more information.

Fund Flows
Exhibit 35: Domestic equity mutual fund flows, 4-week moving average Exhibit 36: Weekly mutual fund flows and assets tracked by AMG
week ended March 24, 2010 Week ended March 24, 2010; excluding ETFs
10.0 AMG Weekly Mutual Fund Flows, ex-ETFs ($ billions)

Domestic Equities, 4-week moving avg Total AMG Weekly Flows 1-Week Flow Inflow/(Outflow)
8.0
Assets 4-Week Avg This week % of Assets (Cons. Weeks)
6.0
All Equity 1,753 0.7 0.6 0.0 % 5
4.0
U.S. Equity 1,312 0.2 (0.0) (0.0) (1)
2.0
$ billions
Int'l Equity 320 0.3 0.7 0.2 2

0.0
Global 121 0.3 (0.0) (0.0) (1)
(2.0)
Equity Income 84 0.1 0.1 0.1 5
(4.0)
(6.0) Gold & Nat Res 26 0.1 0.1 0.4 1
(8.0) Money Market 2,730 (32.0) (3.1) (0.1) (11)
(10.0) All Bonds 880 3.9 3.5 0.4 54

Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10
Govt Treasury 18 0.4 0.1 0.8 24
Exhibit 37: Average daily TRADING TURNOVER over the last week Exhibit 38: Top ten S&P 500 STOCKS by daily average trading turnover
by sector, as of March 25, 2010 as of March 25, 2010
Materials Avg Daily 1-Week

1.9
Trading Total
Cons Discr 1.3
Company Ticker Sector Turnover (%) Return (%)
Info Tech 1.2
American Int'l. Group AIG Financials 12.3 (0)
Financials 1.1
United States Steel Corp. X Materials 12.0 4
Energy 1.1
Massey Energy Co. MEE Energy 10.1 (3)
S&P 500 1.0
AK Steel AKS Materials 7.8 (1)
Industrials 0.9
Cliffs Natural CLF Materials 5.7 7
Health Care 0.9 Tesoro Corp. TSO Energy 5.1 (3)
Utilities 0.8 CF Industries Holdings CF Materials 4.8 (3)
Telecom Services 0.7 Lennar Corp LEN Consumer Discretionary 4.8 9
Cons Staples 0.6 Chesapeake Energy Corp. CHK Energy 4.7 (6)
Ford Motor F Consumer Discretionary 4.6 1
0.0 1.0 2.0 3.0
% Daily Avg Trading Turnover S&P 500 Average 1.4 (0)
Daily average turnover = daily avg trading value / avg market cap (over the past 5 trading days).
Daily average turnover = daily avg trading value / avg market cap (over the past 5 trading days).

Risk and Dispersion

Exhibit 39: Goldman Sachs Risk Barometer Exhibit 40: VIX Volatility Index
Index is number of standard deviations from the average * 100 as of March 25, 2010
400
90
81
300 All time high on 20-Nov-08
75
Risk Aversion
200 Increasing
60
100
45
0
(100) 30
Risk Aversion 18
(200) Decreasing
15
25-Mar-10
(300) 25-Mar-10
0
Dec-94
Nov-95
Nov-96
Nov-97
Nov-98
Nov-99
Nov-00
Nov-01
Nov-02
Nov-03
Nov-04
Nov-05
Nov-06
Nov-07
Nov-08
Nov-09
Nov-10
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10
Jan-12
Note: Metrics included are implied option volatility (S&P 500 and NASDAQ 100), normalized skew, high
yield credit spreads, credit derivative swap spreads, mutual fund net flows, and cash levels.
Source: Goldman Sachs Global ECS Research. Source: Goldman Sachs Global ECS Research.
Exhibit 41: S&P 500 stock and sector average correlation Exhibit 42: Credit Default Swaps, 5-Year On-the-run Spreads
300 1,800
1.0
1,600
0.9 Average sector correlation 250 CDX (HY) (rhs)
Investment Grade CDX (bps)

0.73 1,400
0.8
High Yield CDX (bps)

1,200
200
Average Correlation
0.7
1,000
0.6
150 800
0.5 600
0.38
0.4 100
400
0.3 200
50
0.2 CDX (IG) (lhs) 0
0.1 0 (200)
Average stock correlation
Dec-07
Jun-08
Aug-08
Dec-08
Jun-09
Aug-09
Dec-09
Oct-07
Apr-08
Feb-08
Oct-08
Apr-09
Apr-10
Feb-09
Oct-09
Feb-10
0.0
Dec-89
Dec-90
Dec-91
Dec-92
Dec-93
Dec-94
Dec-95
Dec-96
Dec-97
Dec-98
Dec-99
Dec-00
Dec-01
Dec-02
Dec-03
Dec-04
Dec-05
Dec-06
Dec-07
Dec-08
Dec-09
Dec-10

Goldman Sachs Recommendations and Forecasts

Exhibit 43: Goldman Sachs Recommended Sector Weightings (a) Exhibit 44: Goldman Sachs US Economics quarterly GDP forecasts
Sector Weightings
4.0 %
US GDP Growth (qoq annualized

Total Goldman Sachs Current GS GS
Return Recommended S&P 500 Overweight / Alpha 3.5 %
Sectors YTD Sector Weightings Weight Underweight YTD
Information Technology 2% 19 % 300 bp (8)bp 3.0 %
Energy (2) Overweight 11 300 (19) 2.5 %
Materials 1 3 200 (7)
2.0 %
%)
Consumer Staples 6 11 0 0 3.5 3.5
Industrials 12 Neutral 10 0 0 1.5 % 3.0
2.5 2.5
Financials 11 17 0 0 1.0 % 2.0
(100)
1.5 1.5
Telecom Services (4) 3 9
0.5 %
Consumer Discretionary 11 10 (200) (11)
Underweight
Utilities (5) 3 (200) 18 0.0 %
Health Care 3 12 (300) 5 Q1E Q2E Q3E Q4E Q1E Q2E Q3E Q4E
S&P 500 5% 100 % 0 bp (13)bp
(a) Sector weightings last rebalanced December 7, 2009. 2010 2011
Exhibit 45: Goldman Sachs COMMODITY and CURRENCY forecasts Exhibit 46: Goldman Sachs US Economics forecasts
Forecasts % Annual Change
units Current 3m 6m 12m 2009E 2010E 2011E
Real GDP (2.4)% 2.6% 2.4%
Energy
Consumer Spending (0.6) 1.9 1.4
WTI Crude Oil $/bbl 80.53 92.00 97.00 96.50
Total Fixed Investment (18.3) (2.4) 4.2
NYMEX Nat. Gas $/mmBtu 3.98 5.50 5.50 6.00
Business Fixed Investment (17.7) (3.2) 2.3
RBOB Gasoline $/gal 2.20 2.44 2.50 2.39 Residential Investment (20.4) 0.7 10.9
Metals Federal Government Spending 5.2 3.9 4.0
LME Copper $/mt 7435 7850 8045 7825 Exports of Goods and Services (9.6) 12.1 7.5
London Gold $/troy oz 1093 1260 1315 1390 Imports of Goods and Services (13.9) 7.8 2.5
London Silver $/troy oz 16.79 21.00 21.90 23.20 Core CPI 1.7 0.8 0.1
Currencies Unemployment Rate 9.3 9.8 10.1
Euro / US Dollar EUR/$ 1.33 1.45 1.45 1.35 Fed Funds Rate 0.1 0.2 0.2
2-year Treasury Rate 0.9 0.9 2.0
US Dollar / Yen $/¥ 92.7 92.0 94.0 98.0
10-year Treasury Rate 3.8 3.3 4.0
Sterling / US Dollar £/$ 1.49 1.67 1.73 1.61

Goldman Sachs Strategy Baskets 1

US Portfolio Strategy baskets are designed to provide portfolio managers with vehicles to monitor and implement thematic views in the U.S. equity markets.
Our baskets may be found on Bloomberg by typing <GSSU5>. The Bloomberg page provides real-time basket performance and current basket constituents.
To obtain access to our baskets on Bloomberg, please contact your Goldman Sachs salesperson.
Exhibit 47: Strategy basket performance and average valuation data Exhibit 48: Strategy basket total return performance over the last week
as of March 25, 2010 last week % total return, as of March 25, 2010
Bloomberg Total Return % P/E P/B Div Yld Hedge Fund VIP <GSTHHVIP> 0.3
Ticker 1 wk 1 mo YTD NTM LTM (%) Fragile Profit Margins <GSTHFMAR> 0.1
Macroeconomic Baskets S&P 500 0.0
BRIC Sales <GSTHBRIC> (0.3)
International Sales GSTHINTL (1)% 5% 5% 18x 4.6x 1.8 % Low Operating Leverage <GSTHOPLO> (0.3)
US Sales GSTHAINT (1) 3 3 17 3.5 1.7 Weak B/S <GSTHWBAL> (0.3)
Robust Profit Margins <GSTHRMAR> (0.4)
Western Europe Sales GSTHWEUR (2) 5 6 17 3.8 0.9
GARP <GSTHGARP> (0.4)
BRICs Sales GSTHBRIC (0) 5 6 19 3.9 1.1 Low HF Conc <GSTHHFSL> (0.5)
Strong Balance Sheet GSTHSBAL (1) 6 6 21 6.2 1.1 High Sharpe Ratio <GSTHSHRP> (0.5)
High HF Conc <GSTHHFHI> (0.5)
Weak Balance Sheet GSTHWBAL (0) 8 6 18 3.4 1.8
Dividend Growth <GSTHDIVG> (0.6)
Robust Profit Margins GSTHRMAR (0) 6 9 17 5.5 1.2 Strong B/S <GSTHSBAL> (0.7)
Fragile Profit Margins GSTHFMAR 0 8 7 17 3.0 0.9 Invest for Growth <GSTHINVG> (0.7)
High Op Leverage GSTHOPHI (1) 6 11 21 4.5 1.3 US Sales <GSTHAINT> (0.9)
High Operating Leverage <GSTHOPHI> (1.0)
Low Op Leverage GSTHOPLO (0) 4 2 16 5.9 1.9
Int'l Sales <GSTHINTL> (1.1)
Hedge Fund Baskets Western Europe Sales <GSTHWEUR> (1.7)
High HF Concentration GSTHHFHI (1)% 7% 7% 19x 4.4x 0.5 % (2) (1) 0 1
Low HF Concentration GSTHHFSL (0) 4 5 14 3.1 3.5 Source: FactSet, and Goldman Sachs Global ECS Research.
Hedge Fund VIP GSTHHVIP 0 6 7 19 4.3 0.9
Exhibit 49: US Portfolio Strategy thematic trade recommendations
Valuation Baskets as of March 25, 2010
GARP GSTHGARP (0)% 7% 5% 17x 4.5x 1.0 % Thematic Trade Recommendations
High Sharpe Ratio GSTHSHRP (0) 5 4 16 3.4 1.2 Initiation
Date Return
Use of Cash Baskets BUY High Sharpe Ratio Basket (GSTHSHRP); SELL S&P 500
Dividend Growth GSTHDIVG (1)% 5% 5% 14x 5.2x 3.5 % See 2010 Outlook: Cyclical start; defensive finish (7-Dec-09). 8-Dec-09 2.8 %
Invest for Growth GSTHINVG (1) 4 4 16 4.5 1.6 BUY High Oper. Leverage (GSTHOPHI); SELL Low Oper. Leverage (GSTHOPLO)
See Macro to Micro Shift Part II: 2H 2009 Update (20-Jul-09). 20-Jul-09 9.9 %
S&P 500 0% 6% 5% 15x 2.4x 1.9 %
S&P 500 Average 17 3.5 1.7 BUY BRICs Sales Basket (GSTHBRIC); SELL S&P 500
See Portfolio Passport: Coming to America (5-Nov-08). 4-May-09 12.3 %
S&P 500 Median 15 2.5 1.3
1
The ability to trade these baskets will depend upon market conditions, including liquidity and borrow constraints at the time of the trade.

Constituents of High Dividend Growth Basket <GSTHDIVG>

Exhibit 50: High Dividend Growth Basket
as of March 25, 2010
Market Annualized 2010E 2010-2011 2011E
Price Cap Payout Dividend Dividend Cash Return on
Company Name Ticker Sector Rating 25-Mar-10 ($ bil) Ratio Yield CAGR Cash Invested
Altria Group, Inc. MO Consumer Staples Neutral $20.52 $43 76 % 6.8 % 6% 7.2 %
AT & T Inc. T Telecom Services Buy 26.15 154 76 6.4 2 6.6
Verizon Communications VZ Telecom Services Buy 30.31 86 82 6.3 3 6.5
Duke Energy DUK Utilities Sell 16.30 21 75 6.0 3 6.1
Pitney-Bowes PBI Industrials Sell 24.38 5 61 6.0 1 6.1
Lorillard LO Consumer Staples Buy 76.37 12 63 5.4 8 5.9
Eli Lilly & Co. LLY Health Care Sell 35.98 37 42 5.4 2 5.7
TECO Energy TE Utilities NC 15.59 3 65 5.2 2 5.4
Hudson City Bancorp Inc. HCBK Financials Sell 14.13 7 51 4.6 9 5.0
Philip Morris Intl PM Consumer Staples Buy* 51.72 97 61 4.6 7 4.9
Spectra Energy Corp. SE Energy Buy* 22.41 15 67 4.5 4 4.8
Chevron Corp. CVX Energy Neutral 73.80 148 34 3.8 4 3.9
Waste Management Inc. WM Industrials Neutral 34.27 17 60 3.7 7 3.9
Mattel, Inc. MAT Consumer Discretionary NC 22.79 8 46 3.5 6 3.7
McDonald's Corp. MCD Consumer Discretionary Buy* 66.90 72 50 3.4 9 3.7
Abbott Labs ABT Health Care Buy 53.52 83 42 3.2 11 3.6
Clorox Co. CLX Consumer Staples Neutral 64.77 9 45 3.2 10 3.6
Automatic Data Processing Inc. ADP Info Tech Neutral 43.98 22 56 3.2 8 3.5
Linear Technology Corp. LLTC Info Tech Buy 27.91 6 57 3.3 4 3.4
Lockheed Martin Corp. LMT Industrials Sell* 83.53 26 34 3.1 11 3.4
ConAgra Foods, Inc. CAG Consumer Staples NC 24.94 11 43 3.2 5 3.4
Bemis Company BMS Materials NC 29.20 3 47 3.2 3 3.3
Johnson & Johnson JNJ Health Care Neutral 64.57 178 40 3.1 4 3.3
United Parcel Service UPS Industrials Buy* 63.65 63 65 3.0 5 3.1
Marathon Oil Corp. MRO Energy Neutral 31.10 22 27 3.1 0 3.1
Intel Corp. INTC Info Tech Neutral 22.35 123 39 2.8 10 3.0
Chubb Corp. CB Financials Neutral 51.99 17 27 2.8 6 3.0
Xilinx, Inc XLNX Info Tech Neutral 25.45 7 36 2.5 11 2.8
Exxon Mobil Corp. XOM Energy Neutral 66.30 313 28 2.6 5 2.7
Honeywell Int'l Inc. HON Industrials Neutral 44.34 34 50 2.7 0 2.7
Meredith Corp. MDP Consumer Discretionary NC 34.53 1 40 2.7 2 2.7
Travelers Cos. Inc. TRV Financials Buy 54.08 28 23 2.5 9 2.7
JPMorgan Chase & Co. JPM Financials Buy* 44.94 179 6 1.3 50 2.7
Yum! Brands, Inc YUM Consumer Discretionary Buy 38.05 18 35 2.2 11 2.5
Darden Restaurants DRI Consumer Discretionary Neutral 44.69 6 32 2.3 12 2.5
Praxair, Inc. PX Materials Buy 81.36 25 39 2.2 12 2.5
Wal-Mart Stores WMT Consumer Staples Buy 55.61 119 30 2.2 8 2.3
Baxter International Inc. BAX Health Care Neutral 58.72 35 27 2.0 11 2.2
AFLAC Inc. AFL Financials CS 53.21 25 21 2.1 2 2.2
T. Rowe Price Group TROW Financials Neutral 55.22 14 44 2.0 10 2.2
Dividend Growth <GSTHDIVG> Average $52 46% 3.6% 7% 3.8 %
S&P 500 Equal-Weighted Average 1166 21 28 1.7 4 1.8
Source: Compustat, FactSet and Goldman Sachs Global ECS Research.

Recent US Portfolio Strategy

Please contact your Goldman Sachs salesperson for access to additional research or if you wish to be added to the US Portfolio
Strategy research distribution list.
Exhibit 51: Recent research from US Portfolio Strategy
Latest Market Research Publication Date

US Sector View s: Global vs. Domestic tug-of-w ar w ithin the US equity market March 25, 2010
US Portfolio Strategy: Using Sharpe Ratios to enhance fund returns March 19, 2010
US Thematic View s: GARP Update February 28, 2010
US Equity View s: 4Q Earnings preview : Earnings rise, sales trough, margins expand January 19, 2010
US Portfolio Strategy 2010 Outlook: Cyclical start; defensive finish December 7, 2009
Franchise Research Publication Date

Global Dividend Sw ap Monitor: Updating our bottom-up dividend forecasts follow ing the results season March 5, 2010
Global Portfolio Strategy: Macro Conference - Asia 2010: Takeaw ays February 12, 2010
Global Portfolio Strategy: The New BRICS Nifty 50 - EM and DM Baskets November 4, 2009
Periodical Research Description Frequency Timing / Recent Release

Hedge Fund Trend Monitor Analysis of hedge fund holdings and positioning Quarterly February 22, 2010
S&P 500 Beige Book Qualitative assessment of S&P 500 quarterly earnings reports Quarterly February 5, 2010
Strategy Baskets Overview of US Portfolio Strategy thematic baskets Quarterly August 19, 2009
US Monthly Chartbook Monthly report on where to invest in the S&P 500 Monthly March 2, 2010
US Weekly Kickstart Five minute guide to the US equity market Weekly Friday PM
Where to Invest Now Marketing presentation highlighting recent research and best trade ideas Monthly March 5, 2010
Source: Goldman Sachs Global ECS Research.

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United States: Portfolio Strategy

Performance Sector views and performance

S&P 500 Earnings US Portfolio Strategy baskets Caesar Maasry

Goldman Sachs Global Economics, Commodities and Strategy Research 2

Dividend Yield (%)

Operating EPS DPS 8%

S&P 500 DPS growth (year over year)

S&P 500 $57 $76 32 % $22.41 $22.94 2%

Goldman Sachs Global Economics, Commodities and Strategy Research 3

S&P 500 Performance

Shares traded (billions)

S&P 500 Price Level

Telecom Services 0.0 1,000 4

S&P 500 0.0 900 3

Goldman Sachs Global Economics, Commodities and Strategy Research 4

S&P 500 Performance (cont’d)

Consumer Electronics 5 Oil & Gas Refining & Marketing (4)

Viacom Inc. VIA.B Cons Discr 6 12 BJ Services BJS Energy (8) 11

S&P 500 Average (0) 7 S&P 500 Average (0) 7

Goldman Sachs Global Economics, Commodities and Strategy Research 5

Earnings and Sales

S&P 500 (ex-Financials) 52 24 18 15 25 15

Goldman Sachs Global Economics, Commodities and Strategy Research 6

S&P 500 Monthly % Return

Goldman Sachs Global Economics, Commodities and Strategy Research 7

14.8 Industrials RHI 85 NM PBI 10.2 0.7

Goldman Sachs Global Economics, Commodities and Strategy Research 8

S&P 500 Factor Performance

Goldman Sachs Global Economics, Commodities and Strategy Research 9

Style and Size

Goldman Sachs Global Economics, Commodities and Strategy Research 10

Global Equity Market and Mutual Fund Performance

Avg. Total Return (%) Stdev No. of AUM

Goldman Sachs Global Economics, Commodities and Strategy Research 11

ETF Analysis: Composition, Valuation, Growth and Ownership

Goldman Sachs Global Economics, Commodities and Strategy Research 12

10.0 AMG Weekly Mutual Fund Flows, ex-ETFs ($ billions)

Int'l Equity 320 0.3 0.7 0.2 2

(8.0) Money Market 2,730 (32.0) (3.1) (0.1) (11)

(10.0) All Bonds 880 3.9 3.5 0.4 54

Materials Avg Daily 1-Week

Goldman Sachs Global Economics, Commodities and Strategy Research 13

Risk and Dispersion

Investment Grade CDX (bps)

High Yield CDX (bps)

Goldman Sachs Global Economics, Commodities and Strategy Research 14

Goldman Sachs Recommendations and Forecasts

US GDP Growth (qoq annualized

Goldman Sachs Global Economics, Commodities and Strategy Research 15

Goldman Sachs Strategy Baskets 1

High HF Concentration GSTHHFHI (1)% 7% 7% 19x 4.4x 0.5 % (2) (1) 0 1

Goldman Sachs Global Economics, Commodities and Strategy Research 16

Constituents of High Dividend Growth Basket <GSTHDIVG>

Source: Compustat, FactSet and Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 17

Recent US Portfolio Strategy

Exhibit 51: Recent research from US Portfolio Strategy

Latest Market Research Publication Date

Franchise Research Publication Date

Periodical Research Description Frequency Timing / Recent Release

Source: Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 18

Ratings, coverage groups and views and related definitions