The hunt for yield — how will it reverse? Risk spectrum Fed funds -0.10y IG HY -0. Equities Emerging Markets Two risks for disruptive reversal: 1) Higher US inflation 2) ECB Exit Deutscno B✓w Rote. f an :4 ',PSIS, SP tICTIRT't nkilict tun • 1 212 2-.44 • trail 2tot ECB exit and higher US Treasury yields leading to less demand from abroad for US IG S bilbn 30 20 10 .10 -30 Net foreign purchases of US corporate bonds wren fret rn n1444.0 raed firptNre t 2014 Mt (4.12 OS •nxy 44.101.10 001.100 US :Stir 64 S bllcn 30 25 20 15 win ECB Scrlain; CIE ea brewers Se now ne Seiler/ tri are* 10 11 12 13 14 15 16 17 Ord ..2404 Ilinsrate $ 0 •10 Dreyer an Reimport) S441. 2N2Nw Moe *9 From: Torsten Slok Sent: Thursday, March 01, 2018 8:03 PM To: Martin Zema tart Xavier Avila Stewart Oldfield Cc: Jennifer Francis Subject: RE: Fwd: DB: Foreign demand or US credit weakening Yes, tmrw @ 11.OOam EST? CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0091850 CONFIDENTIAL SDNY_GM_00238034 EFTA01388351