Susan Filyk - IR Susan McGee - President, General Counsel Frank Holmes - CEO, CIO Lisa Callicotte - CFO

Good day ladies and gentlemen, and welcome to U.S. Global Investors Webcast, U.S. Global Investors Earnings Announcement for the First Quarter of Fiscal 2015. If you have any questions during the webcast, simply enter your question in the dialogue box at the bottom of the screen and click submit. Also you may download a PDF of today's slides by clicking on the Resources tab in the top center area of your screen. You can also download some of U.S. Global Investors' latest research on the Resources tab. To switch back to the presentation, just click the Slide tab. We would like to begin by introducing Susan Filyk, Investor Relations at U.S. Global Investors. Please begin.

Thank you. Welcome, everyone, to our webcast announcing results for the quarter ended September 30, 2014. The presenters for today's program are Frank Holmes, U.S. Global Investors' CEO and Chief Investment Officer; Susan McGee, President and General Counsel; and Lisa Callicotte, Chief Financial Officer. During this webcast, we may make forward-looking statements about our relative business outlook. Any forward-looking statements and all other statements made during this webcast that don't pertain to historical facts are subject to risks and uncertainties that may materially affect actual results. Please refer to our press release and corresponding Form 10-Q filing for more detail on any factors that could cause actual results to differ materially from any described today in forward-looking statements. Any such statements are made as of today and U.S. Global Investors accepts no obligation to update them in the future. If you have a question for us, you can submit it at anytime during the webcast. Simply type your question in the dialogue box at the bottom of the screen and click submit. If we aren't able to answer your question during the live presentation, we will follow-up with you individually. Now let's go to Frank Holmes, CEO and CIO for an overview of the quarter. Frank?

U.S. Global, GROW is a publicly traded boutique investment and in that process of being boutique investment company, we have focused on emerging markets and resources, which have had a tremendous challenges in the past (Technical Difficulty) real GDP growth. So with that I would like to go into Slide Number 5 and let's start to articulate some of the challenges we've had for the past quarter and the past couple of years and how we are dealing with them? But still, well, I'm going to start to show to you is that there are strengths and then GROW is a go-to stock for exposure in emerging markets and resources. And this is where the bulk of the world's population is and the world now is connected like we have never seen before with Facebook over 1.3 billion connected and everyone who wants to have an American Dream, so emerging markets will have their turn and so we are positioned to participate in that. We as a company going through this, this dally, this drought and the capital flows, we remain debt free. We have a strong balance sheet and we have a reflexive cost structure to navigate through these waters. We're still a monthly dividend and return equity discipline and to get that equity discipline, we have to be conscious of costs which Lisa Callicotte can talk to more about in detail. And in the next visual, I'd like to hop over to the top institutional holders of growth and thank them for their royalty and their support during these challenging times and emerging markets and gold and resources, oil and gas as you can see who are the top five key investors in U.S. global. Doesn't have paid dividends for more than six years, it's a $0.005 per share and we pay that every month and the current yield is 1.69%. The next visual is on Page 8, the share repurchase program is in motion. The Board approved a repurchase of up to 2.75 million of its outstanding common stock on the open market through the calendar this year 2014. And during their first fiscal quarter of 2015, the company repurchased 16,793 Class A shares using cash of approximately $59,000. We have an algorithm and this is used to buyback stock in down days in accordance with all applicable rules and regulations that restrict amounts and times of repurchases. We may suspend or discontinue at any time, but at this stage we still remain committed to be able to accumulate stock in down days. The current line up of our funds, as you can see gold and precious metals not resources, the China region, emerging Europe. And then we have domestic equity, the homes fund, the All American fund and short-term funds, which we are going to highlight where we are growing and what we find is, this is an important position in everyone's portfolio is we would like to characterizes our no drama fund, the near term tax free fund. Building for the future growth, this increased ownership of the Canadian asset management company developing innovative and dynamic EPF products to expand the product line and earning valuable exposure for our brand in over 170 countries through publishing of our financial commentary and other content. The next visual highlights the no drama fund, assets have been growing. They have been growing at a 30% compounded rate of return and this is our near term, short-term, AAA rated municipal bond fund which we are – have a lot of our own money into this particular fund. And it's a very low volatility fund and that's what we mean when we say no drama, we mean very little volatility and steady Eddy wealth building program. So with that, I would like to hop over to our strategic relationship with Galileo, GROW ownership is 65% of Galileo, it's an internal based company with approximately 226 million in assets under management. It's accretive to growth. The flagship fund consistently rated 4 or 5 stars in Canada, 2013 Lipper Fund award for best Small-Mid Cap fund in Canada over five years. The CEO Michael Waring is a seasoned veteran in active money management. The next visual shows you, how the assets are including Galileo, and what you can see is that a steady decline has taken place in our assets. There is a couple of reasons for that. One is the restructuring of what we did in our line-up a year ago and two, it is just a decline in resources and emerging markets and never had a correlated, which I will talk about it later to global real GDP and as global real GDP has declined it has created a decline in those assets. But, we are seeing sparks of change in government policies to ignite change in Europe, there is almost a panic button being pushed and (indiscernible) Japan was the first to ignite the world last year with this massive monetary stimulus program. And now, we are starting to see that in Europe. So that's the positive part looking forward. Next visual is the asset breakdown, as you can see our funds, what's important here is that we have a strong relationship with our shareholders. The bulk of the shareholders are directly dealing with us. They are not through the platform Squab, PD or great, great partners in the distribution of assets. However, their loyalty there is very much of a 50-day and 200-day moving average. Their investors using those platforms whereas investors that come direct with us are much more loyal and a lot of the high swing in assets come through those platforms. So we maintain a strong brand or relationship with our investor alert and Frank talk which goes out on a weekly basis and that's how we stay connected to our domestic investors and interesting enough as I mentioned earlier, there is a global reach to an extended universe of family of followers in 170 countries. The next visual is 15, is showing that our balance sheet remain strong and no debt. We have redeployed a lot of our assets to earn higher yield money funds which we basically reposition because they were costing us too much money. And even with raising interest rates that threaten 18 months ago nothing has happened in Fed funds rate, nothing has happened in repo rates, there is still even with this stop, interest rates are going to raise next rate, the repo rates are going to raise, fed funds are going to raise, the repo rates still remain at two basis points. And had we kept those money funds internally we'd have lost millions of dollars additional. So looking back out of that review mirror, it was a positive decision. However, when you look at overall the company of direct assets as the only factor you will look at it is just asset under administration, it doesn't look as attractive but I do think is an important strategic move that we have made and it's also repositioned how we rethink our own company and the needs from HR cost for maintaining in a highly, highly regulated world, it's been better to streamline and we are happy with that. The next is showing the earnings per quarter, what's taking place during this challenging period of the declining assets. We were really frustrated, annoyed, disappointed in the last quarter because we had anticipated that we are going to echo the profit. However, that last week of September was just so punishing to anything that was natural resources to our investments in funds and other equity investments they just declined. And so the big part now is that look forward going back to that rebound but that did impact our business model in this past quarter as Lisa Callicotte go into greater description of what took place before the Q&A. Next is a visual as how we like to position in the audience of investors we have income oriented investors. We have value investors and we have growth investors. And what you can see is that the growth of the past three years has been dramatically challenged with the declining assets versus our peers which have a much greater exposure to the fixed income market or the general domestic equity market and they have enjoyed a strong growth because the stock market as a whole has grown much more – domestically much more significantly on a relative basis. And the same thing has happened for the value investor and the income investor. One of the things that our dividend yield remains healthy. We are happy that the yield was higher than the five-year government bond and is high reflexive to any pop in gold, or in the emerging markets. I will now show that visual in a second. But, we realized that we have to do everything to get our return on equity higher and that's where we are focusing on by dropping our costs. And very costly launching our EPF products and what the work we have been doing on it. One of the things we are happy about we didn't launch the gold ETF that we looked at because nothing but fallen it's just so – it's a drought on gold and the big factor please go to usfunds.com, we have tried to explain to investors first and foremost is that how the 10% waiting not a 100%, it's just a helpful factor in overall portfolio and we balanced each year. But, what are the drivers, and there is a fear trade, and a love trade, and with real interest rates going positive on a 10-year government bond from 18-months ago being negative that was positive strong dollar has impacted, oil it is impacted gold and it has impacted our overall results. But nevertheless, we do believe in emerging markets and growth are emerging economies and we have do believe gold is an important part of it in the diversified portfolio. And to rebalance on an active basis. Looking long-term, we'd like to give the visual choice, what our annualized return is, it's still even with this tremendous volatility as the annualized return of 10.29%. Now GROW, the next visual is trying to show you for the past 12 months, we have outperformed many of the natural resources indices that are out there and that's a real surprise for a lot of investors we're the go-to stock when it comes to emerging markets and small cap stocks. Other public companies that are in our space like – we have a much stronger shareholder following and it shows up and how fast we will respond. And we have also did a great job -- Lisa and Susan Filyk and Susan McGee has done a significant job in streamlining cost and structure to be that reflexive cost structure with overall decline in these assets. And we are only poised that any raise in assets well, it just could be extremely accretive then fall to bottom-line. And you can see the performance for the past three months even with the meltdown in many of these markets, GROW has done significantly well on a relative basis. We just wish that it – we had a stronger flow in these emerging markets and resources and that's where decision important for GROW. Now, I'm going to turn over to the brains of the outfit and it will be Lisa Callicotte, who will talk about financials and then Susan McGee will talk about some of the strategies and what we are working on. Now, I will turn it over to Lisa to talk about the income statement and financial analyses.

Thank you, Frank. Good morning. I would like to summarize our results of operations for the quarter September 30, 2014. And as I discuss the results, you will see a consistent thing. And this is due to obtaining a controlling interest in Galileo in June 2014 because we are now consolidating the revenues and expenses into our income statement. So as I'm comparing the quarterly results, you will see that there will be increases in both revenue and expenses due to the consolidation of Galileo's result. So beginning on Page 22, we recorded total operating revenues at $3.3 million for the quarter. And this was an 8% increase from the $3.1 million, we reported the same quarter last year. The increase is primarily due to the consolidation of $662,000 of Galileo revenue and was offset from decreases of revenue of our U.S. GI Mutual Fund due to lower assets under management. Moving on to Page 23, operating expenses for the quarter were $3.6 million. This is a decrease of $515,000 or 13% primarily for the following reasons. Employee compensation and benefits decreased $304 million or 16% as a result of fewer employees and lower performance based bonuses offset by the addition of Galileo expenses of $153,000. General and administrative expenses decreased $363,000 or 24% primarily due to higher fund reimbursements in fund restructuring costs in the prior year and offset somewhat by the consolidation of Galileo expenses of $145,000 in the current year. Platform fees actually increased $171,000 at 34% and this because we included $276,000 in Galileo platform fees but it was offset by decreases in platform fees for U.S. GIF Mutual Fund due to lower assets held through proper dealer platform. On Page 24, we see our operating loans for the quarter ended June 30, 2014 is $316,000, but this was offset by our other income, which is income related to our investments. Other income for the quarter was $220,000. Net loss attributable to U.S GIF after taxing for the quarter was $128,000 and as you can see on page 25; this is a loss of a $0.01 per share. Moving on to page 26, we do see here that we have strong balance sheet. It includes $27.9 million of cash and marketable securities and this makes up 76% of our total assets. And on Page 27, again, we have no long-term debt. The company has a networking capital of $23.4 million and a current ratio of 14.91. With that, I would like to turn it over to Susan McGee.

Thank you, Lisa, and good morning to everyone. One of our seven core values of our company is performance and results oriented. And as many of you know and are aware of several of our funds have been recognized for their leadership in investment performance. In fact, since 2000, our funds have received by 29 Lipper performance award certificates and top-grading. And as our sales and service teams engage in daily conversations, with financial advisors and investors, a common referring that we hear is that investors are looking for a no drama fund, so counter active volatility in the market. Frank mentioned this a little bit earlier. And (Technical Difficulty) during the past quarter, our efforts have been focused on one of our top end funds, our five star near-term tax free fund or NEARX. That has delivered consistent steady performance. If you compare the S&P 500 to NEARX since the year 2000, what's interesting is, you will see that it took the S&P 13 years to past the steady growth of near-term. If you have couch potato portfolio as we call it where you can sit back, invest in a 50:50 allocation to the S&P and NEARX and as you rebound annually you will get steady growth with less volatility. We are proud of our near-term tax free fund. It's generated as we mentioned consistent positive annual total returns for investors for 12 years. And this was done in a period of very volatile interest rate. It's gained – it's also earned from Morningstar a five-star rating for five year performance a non-municipal national short-term fund. Also, highly ranked by Morningstar's are gold and precious metals fund. It earned an overall four-star rating among equity precious metal fund. We are also pleased that three of our funds hold the top Lipper leader rating. This rating is based on investor-center criteria and on a scale of 1 to 5, a Lipper leader fund that rates a five is in the top 20% of its category. The near-term tax free fund rates to five or preservation in tax efficiency, the All American Equity fund rates to five for preservation and the U.S. Government Securities Ultra-Short Bonds rates to five for preservation and expand. And we have found over the years that investors value preservation and tax efficiency. And so we are very happy and pleased that we have funds that are highly ranked in these categories. Along with our investment leadership, we also continued to be leaders in the financial industry for our award winning marketing and communications strategy. In fact, this past -- the mutual fund educational lines recognized our marketing and investment team which 10 awards for our marketing excellence that brings our total awards to 64 since 2007. Our weekly advisor alter publication was named the best electronic newsletter for six years. It provides original and content from our investments team. And then our schedule to report magazine was named the best investor magazine for the 8th year. We believe that a key building to assets is through educating our shareholders and providing this content that help shareholders and investors navigate some of the complex global markets that we deal in. Our special reports are another area that we share our expertise and we build brand. We have a new research report, it's a white paper called managing expectations, anticipate before you participate in the market. This report is one of the most powerful items on our Web site and is available to download at usfunds.com. And I encourage you to visit the Web Site. We have many more interesting items. We have a wealth of interactive material including slide shows, videos and learning games. So we do invite you to check those items out. Our CEO block, the Frank talk is one of the longest running blogs in the financial industry. We've had more than seven years and provided insight, observation from Frank Holmes. This content and Frank's special commentary published in an investor alert received a great deal of earned media, which is of viral gain for sharing of our content about their resources rather than paid advertising. And this earned media helps us leverage our brand by reaching millions of readers, viewers and potential investors. And in addition, our online community is growing, interact frequently with vial and digitally engaged followers through email through Facebook or Twitter and LinkedIn. The financial media continues to like to Frank as the go to go-guy for his expert in balance fees and the precious metal. Just this week, he was on CNBC, you might have seen him there. Another popular item that Frank participates in is the Gold Game Film. It is being produced by Kitco which has one of the biggest gold Web sites in the world. It's a weekly show that Peter's Frank commentary on the gold market and it airs to an audience of 10 million monthly visitors on the Kitco news Web site, we produced 31 episodes so far and that audience continues to grow. In addition to expert opinions on gold Frank and other members of the team are sort out by the financial media to discuss natural resources, domestic and emerging markets. We have been interviewed by CNBC in the U.S., but in Asia Oxford Club Radio, The Money Show, Casey Research, Public State Radio, Marketwatch and many, many more. In addition, we had many influential financial news that our writers recommend our funds to their subscribers. So with that, I would like to turn it back over to Frank, who will discuss what we have been watching in the market this year. Frank?

Thank you, Susan. Susan has been busy as mentioned earlier looking for opportunities at the same time managing the repositioning of our company at the same time, right-sizing costs as we continue to look for avenues to streamline and be prepared for the next rebound. And when it comes, I just know from the cash flow point of view, it will be spectacular. It's just a matter of when do we get this synchronized growth. So I would like to turn to the first visual, in 2002, 2003, 2004, 2005, 2006 and 2007, you had an amazingly synchronized global growth where Europe had strong GDPs, strong purchasing manufacturers numbers, raising trend, everything is above 50, America and you had China and this synchronized global growth lead to an incredible change in poverty around the world for poor people and all these emerging countries. It was the greatest shrinkage and a most significant raise before that these folks took off. Now, they are all connected and you are seeing government policies flounder around the world to deal with this sort of slowdown that took place in 2008. And now, we are starting to see which is in a constructive note, what Japan is trying to do and hope that Europe will be. But, I still going to write in that I see the imbalances just not their monetary policies so much as fiscal policies because it still appears that they are on steroids they tax anything and everyone and the G20 meetings have come from global trade and economic prosperity to tax and regulations. And this creates a sort of schism that takes place. But, it was just a matter of time before that pendulum swings where the world still doesn't stop rowing while all these changes these imbalances, they are still having babies, they are wired to connected and like we mentioned there are 600 million; 600 million people in India under the age of 25. And I think that's a big positive backdrop. But short-term, well, what we see is the JPMorgan Global Manufacturers Purchasing Index which a forecast of what economic activity one can expect six months out based on people buying equipment, making purchase of metals to make a tractor or buying services food doesn't really matter, it's the anticipant – the confidence that they have in purchasing goods for future manufacturing. In the U.S., we call it ISM and every month you get this data and we have done – extensive knowledge if you haven't seen it then go to our Investor Alert and take a look at this research, what are the ramifications, cause, effect and possible ramifications that when one month is above the three months it does have a significant impact on commodity demand. And what we are seeing now, it has gone negative and that is particular since September, it's had a big impact in oil, steel, copper and the slowdown. And then when you dig down, and you try to say what are the countries that are pulling that apart, it's not America. Americas is doing fabulously well. But, it's Europe. And Europe is the first to start to pull it down and it's impacted China because Europe is a bigger trading partner with China than America is. So in the next visual, what makes America look healthy and strong as unemployment rates have dropped to the lowest percentage the summer of 2008, and yes, there are many – less people in the work force, so that data point looks more attractive. But what's important is to see that there is an improvement in employment. The next visual is showing the consumer confidence is raising to pre-recession levels and I think that seeing energy, the gas pump draw, we does some data mining here and every penny is a billion dollar basically and 40% drop in buying gas at the pump line is like a $40 billion tax cut for consumers and it is profound, when you take a look at people earning more than $50,000 or less than $50,000 a year, it is like a huge tax break for them, I think the math shows that 21% increase in their disposal income. So we are expecting consumer spending to pick-up this quarter that would basically show people when you take a look at consumer spending. But, still the talking heads on television and a lot of the news readers are so bearish and negative, but I think it's – we are going to see this happy couple. And his head maybe down because he has been buying goods but that's a happy couple and that's a reflection of the gas pumping down and so raising income levels in America. Now, the U.S. crude price production is at 25 year high, a lot of that has to do with fracing, a lot of that has to do with Americas technology and innovation from the sense and what's really important to recognize is not just a great state of Texas, that is enjoyed – there is immense prosperity in this growth from fracing. So it's also sand quarries in Michigan and Illinois and then the railway systems that Warren Buffet owns because we've got to ship that sand down to Texas. You need the sand, so therefore all these people are getting employed moving sand; values of quarries have gone up dramatically. Moving oil across the nation has improved the Burlington Northern's cash flow dramatically substantially which -- that's basically shows up in Berkshire Hathaway. So it has had a phenomenal movement across the country. And then from the capital markets has been MLPs to finance the pipeline, the infrastructure necessary for these discoveries. And that model has been like REITs were done for the creation of real estate. So it remains very, very important that America is able to get cheaper fuel and is a great concern for that. However, trickles down and shows you compares to the next visual, is that North America natural gas boom is a global bargain. If you take a look at our gas prices compared to what Europe as to pay and Asia has to pay. In Europe's natural gas or oil is substantially higher than what America has to pay and that shows up in feedstock for chemical industry and the Valero's just had intersterile which are based in St. Antonio had phenomenal numbers and that means that they can basically buy energy in expensively here. We produce a high-quality end product which has been exported so that helps our balance of payments and we are seeing these stocks have been on tier. So that's how you have to reposition and think. There is always a positive for the negative. Where is friction there is always an opportunity. We see it what's I call excessive regulations globally in the financial sector, but it's been a boom for those that are in compliance. And JPMorgan has to hire 24000 people originally in the Wall Street journal. So wherever there is a positive you got to look for the negative and be able to move in that space. So that's what we are trying to highlight here that there all of these opportunities. Now let's go back to China. China's manufacturing activity appears to be modestly trying to grow again, but nothing significant enough to ignite a global boom in resources. What's important is that their leader follows has his own economic barometer he follows three key factors to try to monitor what's happening economically. The next visual is try to help investors to appreciate that the EU trades more of a China than the U.S. So that when the PMIs in Europe are in decline and there is a schism that's over in that, that overall a socialistic mindset in Europe, it does have an impact on China and Southeast Asia. When I was in Rome a couple of weeks ago in Italy talking to private equity investors, it's for the first time that they're going to invest in Italy. So you can imagine that a private equity investor in Milan with $1.2 billion will would in the past would not invest in his own country. And he had to have all of his analysts based in either Luxembourg why is that because the union mindset and federal laws in Italy basically prohibited employing people there. And it also impacted youth, highly educated youths under the age of 28 years old, 40% unemployment. So you end up going to hotels in London, England and you'll find that there are French, there are Spanish and there were Italians where all with University Degrees, but there is no employment in their own country, even in the tourism business. So that's where they have to go. And now finally, Italy is changing those rules to be able to be more inclusive and that's one of the things at the European socialist union mindset as it creates exclusiveness and it creates the vision. Flying back, I had to fly through with German airlines to get the best deal and there was delays and disappointments with that process. What happens there was that the train union was going on – was on strike and the airline unions between who tickets you, and who flies you and their flight attendants are all different and they don't talk to each other. I found that at the counter when my flights were delayed. So it's really, it's interesting to see that finally Italy is making changes and the private equity, Italian private equity fund is making investments in Italy so this is very positive. A year ago, we noticed that if you get your passport, if you get your Visa to go into Europe and you're coming from China, that it was easier in China to go through the Spanish Embassy than it was the French Embassy. So what did that do? So the Spaniards responded now to make the process of moving the paper more readily and quickly to stamp and approve Chinese tourism to go to Europe so they went to Spain, they never made it to Paris. So luxury goods grew dramatically in Spain not in Paris, in fact Paris the nation – the Eiffel Tower, the icon of luxury goods had a shrinkage in luxury goods spending, whereas tourism by the Chinese has been significant all over the world and we see here in San Antonio, Texas, the older ones we see signs in Chinese now catered to tourism. So I think it's important to recognize that we have to have the streamlining of regulations and rules around the world to get back to 2003, 2004 and 2005 of global economic activity and it's good to see that it is in motion and that gives me optimism for the future. Now we're going to take a look at the next visuals. Alibaba tops the list of 10 largest IPOs, this is China, there is so much negativity in China, but the China A market has been positive all through the summer. And so there is something going on that's very positive with China. And we can take a look at Alibaba, you should see how profitable their numbers were this past day, I mean it's mind-boggling how much money Alibaba makes, it's just shocking. And so you could take a look at Visa and MasterCard to get an idea of global tourism in spending and you can see that they had record numbers. So we remain very bullish that the government policies are finally waking up, there is significant change and the future looks stronger and better. We had a piece of marketing piece of 600 million resource to keep your eyes on India, new leadership in India, he's all about pro growth, he's recently come to America, he was visiting Washington, and I think he's going to become a significant trade partner with America, it's going to be India and I think in the global strategy of geopolitics that America is going to align with India to balance the growth of China. And with that, you can see this individual Modi, he is all about pro business, his state is like the state of Texas and his growth has been significant in Gujarat in India and that's a big part of his leadership that the Indians voted him in because he is all about pro growth. And that's showing up in consumer spending, it's also showing up investors in India buying their own local stock market which has seen a resurgence. So Europe's imbalanced physical monetary policy sometimes visuals are more important and I try to give you an idea there will be a balanced government policy between monitoring fiscal is like the Tour de France cycles, they can even climb extremely quickly up a mountain. But the other bicycle is you can see when you have an imbalance of physical versus monetary that bicycle is fun to look at but it's non-competitive on a global stage on economic prosperity. And the other part I would like to highlight when we look at Europe, why is it that the brightest brains engineers out of Germany and France and Spain are all in San Francisco area because this is where the hopes and dreams of innovation are rewarded, they're not rewarded in socialist countries. There is no Facebook that's come out of France, there is just none of that opportunity that people aspire to you, it's all in America. And this idea that you too can be successful is America dancing with the stars, competition from kids doing cheerleading, your son may not be in the football team but your son is a musician, could be get a sports scholarship being in the band. And your daughter may not be training for Olympic – Olympic athlete but they're getting a full scholarship playing for Texas A&M cheerleading. This is an incredible phenomenon in America and it attracts the best and brightest brains. And I think that this idea of socialism creates tremendous physical imbalances and what we're seeing is now a rebalancing, maybe that's took place the elections recently in America this week of trying to rebalance the fiscal monetary policies so we remain very bullish on the global economic stage of this rebalancing of the wheels here and let's get cycling, let's move forward. Now let's talk about gold. Gold is very just hardly used, September is a great month, we brought about, however, we saw the U.S. dollar maintaining center stage as the strongest currency in the world because Europe went to negative real interest rates so gold starts to rally in Europe because of the bonds falling, growth of five year government bonds here and gold is money, it's an interesting triangle, you got to look at five year and money rates on euros and you got to look at dollars and you look at gold, and gold will go up in the country that has the weakest overall negative interest rates. So going up in euro terms, gold was up in Japanese yen terms, gold falls in dollar terms. So if you are following the fear trade, you wonder what's going on, it's real negative interest rates in America have turned constructively positive and therefore the dollar is stronger against the yen it's stronger against the euro. So the gold seasonal pattern is still in place for the luxury but not as strong, it's not as strong because the real GDP growth of Chindia has not has been as strong as it was in 2004, 2005 and 2006. And what's important to recognize that gold did rally during this environment and the big factor with that was not only negative interest rates in the U.S. but it was a strong Chindia global economic boom. But what are we seeing, what we're seeing with gold, gold is extremely oversold. And if you go back to 2007 gold had not hit $800,000 but gold stocks what they're paying for earnings were substantially higher than what we are today. So the emotional sentiment makes gold stocks extremely attractive and just a price of gold is extremely oversold and what we've recently try to highlight to investors is that not only is gold extremely oversold and reduce the buying opportunity. That is also similar to the hardest market rate now is biotechnology. And if you look at the volatility of biotechnology is in fact greater than gold, this shocks lot of people. And we had biotechnology stocks in the summer of two center deviations and they immediately sold off in September, and now they have had a rebound whereas gold sold off. It had a rebound and it is now come back to a buying opportunity. So, it's so important that investors understand the DNA of volatility is different for every asset class but some asset classes are similar. But because biotech technology relates to the demographics of the world that is the aging population of China and Europe and America and what can we do, what field could I take that's going to make me as I say they 60, the new 60 is 40 years old. And any new biotechnology is going to solve this problem is getting more and more attention or Ebola, where is the technology and biotechnology is going to can solve the Ebola. It's really that the thought leaders are North America, the thought leaders are in Canada and the U.S. in particular, America and where is the counter being formed to fund their scientists, they're in North America. You can witness it in the capital markets. So, this what makes America special, it makes us special and fast to confirm capital to solve a crisis around the world. So this is a reason why you got to love the leadership, the thought leadership in this great nation. But what we do see is in the capital markets, there have been changes. And in Frank talk we try to highlight and educate investors and Susan Filyk and her team has done a remarkable job that we won 10 awards this past year for education and it's in a competitive arena like Dancing with the Stars. It's important that investors recognize it and with that it's always competition and that's what leads America being a great nation. But in that idea of understanding how capital changes in educating investors that when volume, how a volume affects stocks and the volume drops off, it does affect the spread between bids and asks. And they're all real patrons that affect gold markets, in gold markets historically since I've been on the business fade when the price of gold in New York closes on the COMEX and it seems to make the lower the day in the later afternoon and then rallies at the month end and it rallied at weekend and it guess what most important on a daily basis it rallies in the last, if it's going to rally, the most significant rallies in the last half hour of the day, it's just a function that it's hot in Texas and it's cold in Alaska, that's just what it is and how those markets function and it's for us to be able to try to help this idea of price discovery. And the capital markets have been impacted by high frequency trading. The ability of rewriting algorithms every night and then replacing them in a capital markets really truly has changed the overall formation of capital and the advent of ETS that has changed the formation of capital and a lot of times overvalued fundamental stocks can raise all because of fund flows, all because of ETS. And it's important to recognize and stop picking, we'll always be important and then more over we are seeing this with ETS coming with factor screens they try to capture how to separate better fundamentals from weaker fundamentals in those fund flows. But if you're not reading U.S. Global Investors do start, we highly recommend it, it's a great way for us as money managers to think about what's driving the global economy, the domestic economy for the weak and try to articulate ourselves like gain from analysis to be comprehensive yet concise always $0.03 for strength $0.03 for weak, I have to start reading Doctor Seuss speaking quickly, we're one fish, two fish and speaking here today and try to get this timeline in. But I think it's important for investors to read it and if you have comments and ideas that you'd like to share with us please do, we take great ownership in being thought leaders as best we can and your input is important to us, now with that input let's talk about the day about your questions for financials or marketing strategy et cetera.

Thank you, Frank. Now we'll take some questions. To ask a question please you're your question in the dialogue box at the bottom of the screen and click submit. We'll start with Lisa Callicotte, could you comment on some of the streamlining of costs you gone through as assets have declined?

Sure. As I noted earlier, we have been reducing cost and you saw that pretty much across the Board with all of our expenses. And we have discussed in the past that we have a reflexive cost structure, for example one of our largest expense is related to employee compensation and benefits. And with this, we are able to adjust bonuses to align with our revenues. And in conjunction with restructuring some of our products, we also made some staffing reductions. And there are certain expenses like our platform fees, that are based on AUM and so therefore they naturally adjust as our AUM in revenues increase and decrease, but we are always trying to streamline our other costs also. We are reviewing processes and procedures and we're trying to distinguish between our needs and our wants, concentrating on what is going to be the most efficient and effective ways of getting to where we want to be. So, as we do that, we challenge each employee and our department to look at the processes and reduce or eliminate cost when possible. For example, one of the things that we look at is our travel expenses and we've been critically looking at which conferences we plan to attend and we are continuously reviewing the benefits that we receive for each of the items that we participate in.

Thank you, Lisa. Next question is regarding ETF and a timeline for offering ETF and that's for Susan McGee.

We're busy behind the scenes working to finalize these products and the services and service providers involved with those products and we are expecting a launch in the first quarter of 2015.

Thank you, Susan. Frank, it seems like the Galileo purchase has been beneficial to the company. Are there plans for any future acquisition?

Well, yes we're always taking – looking at other opportunities to expand our footprint in our platform at the lowest cost for highest returns in capital and provide our intellectual capital. So we are – but one of the things that's most difficult is – in this highly regulated world is the resources, it's just – there is a so many forms and costs that you're around to respond to from one regulatory regime after another. I was looking at to the past 14 years that the costs for this support system for the regulatory world has come from about $0.02 a share to $0.08 a share. So it's a factor we set the cognizant off in our resources to make sure that we have the highest quality risk management and compliance procedures in place at the same time explore and look at opportunities. So when you go to do due diligence they even – the basic letter of reviewing takes so much time in – we call it nondisclosure document that confidentially agreement when you sign with other companies and entities, just that process now takes so much longer. Everything, there is just so much friction in that process but you know what even with all of that, we are still preserving and we sign agreements on a regular basis looking at opportunities accessing opportunities of how they fit into our strategy what we're looking at. At the same time the most important thing that I think about is cheap and best for an officer is the fund performance and what are we doing to make sure that we get better fund performance across every product and keep the morale up because there is very challenging and someone psychic to be going for a three now four years up 5%, down 7%, up 8%, down 12%, overall is a macro backdrop. So even for a fund is number one but the funds are all down as an asset class over three years, it wears on people, so I have to make sure my resources are focused on that. At the same time, we are Susan and supporting for – in responding to that question signing agreements, looking at and assessing opportunities, in fact today I have calls on assessing two other opportunities. The other part of the questions I saw was our building, given a regular basis we get asked sell a building and put more cash in the balance sheet or payout dividends and you just have no idea how inexpensive it is to operate this building versus going and leasing. If we want to go and lease this quality of a building in San Antonio even at half the space it would cost us more money than what we have today. So basically, if you believe in real assets, then this building gives us valuations to rise over time and our entry point was just so great that we bought this building under a $1 million like the building cost, I think at the time $120 to build when this building was originally built and we paid less than $20 per square foot. So when I take a look at those costs in San Antonio for this quality of a building at this location on the Highway system, it is just better to keep this building unless we could find another great asset that appreciate over time.

Thank you, Frank. Lisa, in hindsight, do you believe that was a good move for the company to accept the money market business as you did last year?

Definitely, we were paying in excess of $1 to maintain the yield on the money market. And so now that we don't have that drain as well as meeting expense caps. We are seeing that benefit.

Thank you.

Well, I expect to end the morning session here and highly recommend that you look at sign-in for investor allot. If you have not, or share with your friends and relatives and do visit Kitco, the Gold Game Show, it is what people like about it that and then just talk about technology. The iPad is just phenomenal that I have given this gain from analysis from Albania and visiting the President of the country and I've given it from gold mines in deep in the almost like jungle of Colombia, I've given it from Asia. The fact that you can – you can Skype anywhere in the world and give people a review is just amazing and I think that the distribution of information for the iPad has just revolutionized TED.com which now gets viewed in 170 countries, 2 million viewers daily. So I think our educational from that system of being able to – if you want to get a flavor for just gold alone not the Investor Alert, which is a broader overall review from BOM markets to equity markets, foreign and domestic on gold then I highly recommend and you want the video format that you take a look at Kitco's Web site. Thank you, everyone and thank you, Susan. Congratulations on all the awards and Lisa and Susan McGee for helping streamline costs, at the same time looking for opportunities in a very challenging market for resource and emerging market oriented firm. Thank you. Thank you shareholders for you loyalty.

This concludes U.S. Global Investors earnings webcast for the first quarter of fiscal 2015. This presentation will be available for replay on our website at www.usfunds.com. Have a great day.