Shock waves, natural and man-made, rocked global economies in the first six months of 2011. Economic growth faced headwinds from severe storms, floods, earthquakes, higher oil prices and a manufacturing disruption of the global component supply chain from Japan. Most of those issues have now passed, however the European sovereign and banking sector debt crisis remains unresolved. Learn more at http://www.nafcu.org/nifucs

1. Third Quarter 2011
Market Commentary
Shock waves, natural and man-made, rocked global economies in the first six months of 2011. Economic
growth faced headwinds from severe storms, floods, earthquakes, higher oil prices and a manufacturing
disruption of the global component supply chain from Japan. Most of those issues have now passed,
however the European sovereign and banking sector debt crisis remains unresolved.
Domestically, year-over-year U.S. GDP for the second quarter was revised down to +1.6%; with businesses
still faring better than households. Although the headline number for the third quarter could show a rebound
in growth, it is less important than current trends which are raising concern the economy could tumble into
another recession.
Political leaders worldwide seem to lack the will to make the decisions needed to steer their economies
toward recovery, leaving monetary authorities shouldering the burden. Following the conclusion of their
August 9th meeting, the U.S. Federal Reserve took the unusual step of announcing that short-term rates
would be held at the current ultra-low levels through mid 2013. They also announced the launch of a new
“Operation Twist”. Starting in October, they will be selling short maturity instruments and re-investing in
longer term assets, thereby leveraging their existing securities portfolio to further drive down long term
borrowing costs. This new stimulus operation had been widely telegraphed to the markets, muting its effect
to date.
Consumer confidence is falling, tending to track the stock market’s weak performance, while not being borne
out in the spending data. The job market remains quite weak, growing at a rate less than that needed to
support a true economic recovery. Indeed, there was effectively no growth in U.S. employment during
August. Initial filings for unemployment benefits since then have remained around 400,000 per week, a level
likely to deliver another lackluster employment report for September.
The very public wrangling over raising the country’s debt ceiling in late July, followed by Standard & Poor’s
downgrading the credit rating of U.S. debt to AA+ have left the American public quite disenchanted. The
September 8th high-profile jobs speech by the President before a joint session of Congress consisted of a
call to renew existing programs, tax high earners and add to infrastructure spending. It appears unlikely to
be passed into law, as previous programs have been largely unsuccessful and increasing the national debt
is highly unpopular.
Resolution of the U.S. debt ceiling debate, and a gradual return to normal auction sizes for Treasury bills
have done little to boost market yields. Their safe haven status continues to drive strong demand for this
asset class and keep yields very low. Absent the usual quarter-end distortions, supply for Treasury and
Agency collateral has normalized, with overnight repurchase agreements yielding between 0.05% and
0.10%.
During the period, low yields and credit contagion concerns made it quite challenging to find opportunities to
enhance portfolio returns. U f t
h tf li t Unfortunately, th
t l these challenges will lik l continue t i
h ll ill likely ti to impact i
t investment strategy
t t t t
through year-end.
Hillary Elder, Team Leader
NIFCU$  350 California Street, 11th Floor  San Francisco, CA 94104
Toll-Free (800) 634-6521 www.nifcus.com

2. Fund Profile
Adviser: HighMark® Capital Management, Inc. State Domicile: California
Custodian: Union Bank, N.A. Shareholder Base: Credit Unions
Trustee: Union Bank N.A.
Bank, N A Inception: September 25, 1975
25
Auditor: Deloitte & Touche Rating: Moody’s Investor Services
Sponsor: NAFCU Services Corporation Aaa-mf assigned 12/18/97
Fund Analysis*
Period E di
P i d Ending 3Q ’11 3Q ’10 3Q ‘09
Total Net Assets ($Mil) 196.6 218.2 469.6
WAM Range (min to max, in days) 9-17 4-22 34-55
WAM Average (in days) 13 13 44
Effective 30 day yield 0.03 0.11 0.20
Portfolio Composition Portfolio Review*
As of September 30, 2011 Monthly Average Rate
Municipal VRDNs Jul 2011 0.03%
23.68% O/N Repurchase
Agreements
5.09% Aug 2011
g 0.02%
Money Mkt Fund
Sweeps
Sep 2011 0.03%
4.43% Eurodollar Time
Deposits
19.32%
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Bank Notes
7.62%
U.S. Gov't
Agencies
39.86%
National Investment Fund for Credit Unions ("NIFCU$" or the "Fund") is a common trust fund administered by the Union Bank, N.A. and designed
to serve the liquidity needs of the credit union industry. Investments in NIFCU$ shares are not deposits or obligations of and are not endorsed or
guaranteed by the Union Bank, N.A., or any of its affiliates.
Investments in NIFCU$ shares are not insured or guaranteed by the FDIC, the government, or any other agency. Although the Fund strives to
maintain a stable net asset value of $1 per unit, there is no assurance that this will be achieved and it is possible to lose money by investing in
shares.
shares Only eligible credit unions may invest in shares of NIFCU$ State chartered credit unions should check their state's rules for compliance.
NIFCU$. state s compliance
Please request the NIFCU$ Deed of Trust & Plan of Common Trust Funds booklet and review carefully before investing. Past performance is not
an indication of future results. Current yields may differ from those quoted. For more information about NIFCU$, including current rates, please
see www.nifcus.com or call Toll-Free (800) 634-6521.
HighMark Capital Management, Inc. a registered investment adviser and wholly-owned subsidiary of Union Bank, N.A., serves as the Investment
Adviser and manages NIFCU$ assets. Union Bank, N.A. is the Investment Manager, Trustee and Custodian of NIFCU$.
This publication is for general information only and is not intended to provide specific investment advice to any individual.