GLOBAL INCOME FUND
================================================================================
ANNUAL REPORT
December 31, 2000
Independent Auditors
Tait, Weller & Baker
11 Hanover Square
New York, NY 10005
1-888-847-4200
www.globalincomefund.net
American Stock Exchange Symbol:
GIF
GLOBAL INCOME FUND American Stock
Exchange Symbol: GIF
- --------------------------------------------------------------------------------
11 Hanover Square, New York, NY 10005
www.globalincomefund.net
January 18, 2001
Fellow Shareholders:
We are pleased to submit this Annual Report for the year 2000 and to
welcome our shareholders who have made their investment since our last Report.
The primary investment objective of the Fund is to provide for its shareholders
a high level of income and, secondarily, capital appreciation. The Fund pursues
its investment objectives by investing primarily in a global portfolio of
investment grade fixed income securities. At December 31, 2000, the Fund had
approximately 93% of its total assets invested in fixed income securities with
an actual or deemed investment grade rating, approximately 3% below investment
grade, approximately 3% in stocks and the balance in money market securities. At
year-end, approximately 80% of investments were in entities located in the
United States and the balance was spread over seven other countries and
supranational organizations. At its December 2000 meeting, the Board of
Directors eliminated non-fundamental restrictions on Fund transactions in
futures and options on futures. We are also pleased to report that at the Annual
Meeting shareholders approved the proposal to change the classification of the
Fund from a diversified investment company to a non-diversified investment
company.
Review and Outlook
In our prior Annual Report, we noted that during periods of rising
interest rates, the Fund would seek to adopt a more defensive investment posture
by buying shorter duration securities and hedging interest rate exposure with
futures contracts. We expressed concern about rising interest rates domestically
and overseas, as well as increasing defaults in the high yield debt markets. As
these market conditions developed over the course of the year, the Fund's
strategy expanded to upgrade the overall credit quality of its portfolio,
decrease leverage, and increase its dollar denominated investments to benefit
from U.S. dollar strength. We are pleased to report that during this difficult
period, Global Income Fund had a net asset value total return of 9.05% and a
market total return of 19.75%.
After raising the Federal Funds rate to 6.50% in the first half of
2000, the Federal Reserve Bank signaled a change in policy in December and
lowered it by 0.50% in the first few days of January 2001. At the same time, the
Fed signaled its willingness to further lower interest rates to help stimulate
the slowing economy. Five and ten year Treasury note yields fell from 6.19% and
6.28% at the beginning of 2000 to end the year at 5.17% and 5.24%, respectively.
This decline in rates was beneficial for higher quality fixed income prices and
total returns. The Lehman Brothers Aggregate Bond Index had a yearly return of
11.63%. Credit concerns and higher default rates led the Lehman Brothers High
Yield Index to decline by 6.46%. Equity markets suffered during the year with
the Dow Jones Industrial Average, S & P 500, and the Nasdaq Composite Index
declining by 6.18%, 10.14% and 39.00%, respectively.
In 2001, our focus will be on the economy and to what extent growth
slows from the torrid pace set earlier in 2000 and what effect this slowdown
will have on the financial markets. Confirming the slow-
down, the economy grew at an annualized rate of only 1.4% in the fourth quarter
of 2000, the lowest rate in over five years. Recent reports show weakness in the
manufacturing sector and dramatic declines in consumer confidence. On a positive
note, recent declines in interest rates and proposed tax cuts in Washington
could give the economy much needed stimulus. Already in early 2001, the Federal
Reserve Bank has acted decisively to cut the Federal Funds target rate and the
markets are anticipating further cuts in the near term. In view of these market
conditions, the Fund's strategy has been to utilize its global focus and
investment flexibility to increase its dollar denominated investments. Going
forward, we will continue to look for investments with the greatest potential to
provide shareholders with a high level of income and, secondarily, capital
appreciation.
10% Dividend Distribution Policy Continued
The managed 10% dividend distribution policy adopted by the Fund's
Board of Directors in 1997 continues to be well received. The objective is to
provide shareholders with a relatively stable cash flow and reduce or eliminate
any market price discount to the Fund's net asset value per share. Payments are
made primarily from ordinary income and any capital gains, with the balance
representing return of capital. For the year ending December 31, 2000 actual
distributions were 10.06% of average net assets with approximately 72.89%
derived from net investment income and the balance from return of capital. We
believe shares of the Fund are a sound value and attractive for portfolios
seeking total return from capital appreciation and income.
Reinvestment Plan Attractive
The Fund's current net asset value per share is $5.74. With a recent
closing on the American Stock Exchange of $5.00 per share, we believe this
represents an important opportunity to purchase additional shares at an
attractive discount from their underlying value. The Fund's Dividend
Reinvestment Plan is a very effective way to add to your holding because
quarterly dividend distributions are reinvested without charge at the lower of
net asset value per share or market price, which can contribute importantly to
growing your investment over time. Please call 1-888-847-4200, and an Investor
Service Representative will be happy to assist you.
We appreciate your support and look forward to contuinuing to serve
your investment needs.
Sincerely,
/s/ Thomas B. Winmill /s/ Marion E. Morris
Thomas B. Winmill Marion E. Morris
President Senior Vice President,
Portfolio Manager
2
GLOBAL INCOME FUND, INC.
Schedule of Portfolio Investments - December 31, 2000
Par Value Market Value
--------- -----------------
BONDS (96.63%)
Argentina (2.96%)
$ 500,000 Compagnie De Radiocomunicaciones Moviles S.A.,
9.25% Notes, due 5/08/08 .................................... $ 411,250
500,000 CIA Transporte Energia, 8.625% Senior Notes, due 4/01/03 .... 456,250
-----------------
867,500
-----------------
France (1.64%)
500,000 Socgen Real Estate LLC, 7.64% Bonds, due 12/29/49 ........... 480,025
-----------------
Mexico (3.41%)
1,000,000 Petroleos Mexicanos, 9.50% Bonds, due 9/15/27 ............... 997,500
-----------------
Qatar (3.64%)
1,000,000 State of Qatar, 9.50% Bonds, due 5/21/09 (2) ................ 1,065,000
-----------------
United States (76.88%)
400,000 Alcoa Inc., 7.375% Notes, due 8/01/10 ....................... 423,427
500,000 AT&T Corp.-Liberty Media, 8.25% Debentures, due 2/01/30 (2) . 457,347
1,125,000 Bunge Trade Ltd., 9.25% Notes, due 5/01/02 (2) .............. 1,127,812
1,000,000 Comdisco Inc., 9.50% Senior Notes, due 8/15/03 .............. 785,000
1,000,000 Federal Home Loan Mortgage Corp., 7%, due 7/15/05 ........... 1,050,493
1,000,000 Fort James Corp., 8.375% Debentures, due 11/15/01 ........... 999,691
1,500,000 General Electric Capital Corp., 6.75% Notes, due 9/11/03 .... 1,529,287
1,000,000 General Electric Capital Corp., 7.375% Notes, due 1/19/10 ... 1,078,640
7,250,000 U.S. Treasury Note, 6.75%, due 5/15/05 ...................... 7,719,198
7,000,000 U.S. Treasury Note, 5.75%, due 8/15/10 ...................... 7,338,520
-----------------
22,509,415
-----------------
Uruguay (3.25%)
500,000 Banco Comercial S.A., 8.875% Bonds, due 5/15/09 ............. 476,250
500,000 Banco Sud Americano, 7.60% Subordinated Notes, due 3/15/07 .. 476,726
-----------------
952,976
-----------------
Venezuela (4.00%)
814,000 PDVSA Finance Ltd., 8.75% Senior Notes, due 2/15/04 ......... 822,392
455,000 Petrozuata Finance, Inc., 8.22% Notes, due 4/01/17 (2) ...... 346,938
-----------------
1,169,330
-----------------
Supranational/Other (.85%)
MXN 2,400,000 The International Bank for Reconstruction & Development,
15.875% Notes, due 2/28/03 (1) .............................. 248,207
-----------------
Total Bonds (cost: $27,923,660) ........................... 28,289,953
-----------------
See accompanying notes to financial statements.
3
GLOBAL INCOME FUND, INC.
Schedule of Portfolio Investments - December 31, 2000
Shares COMMON STOCKS (2.75%) Market Value
------ ------------
Investment Advice (2.75%)
15,900 Alliance Capital Management Holding L.P. ........................... $ 804,938
-------------
Total Common Stocks (cost: $732,596) ......................... 804,938
-------------
Par Value
---------
Short Term Investment (.62%)
$181,997 State Street Bank & Trust Repurchase Agreement, 3.50%, 12/29/00
due 1/2/01 (collateralized by $175,000 U.S. Treasury Notes 6%,
due 8/15/09, market value: $188,642, proceeds at
maturity $182,086) ................................................. 181,997
-------------
Total Short Term Investments (cost: $181,997) ................ 181,997
-------------
Total Investments (cost: $28,838,253) (100.0%) ........... $29,276,888
=============
(1) Par value stated in currency indicated; market value stated in U.S. dollars.
(2) Purchased pursuant to Rule 144A exemption from Federal registration
requirements.
See accompanying notes to financial statements
4
GLOBAL INCOME FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES
December 31, 2000
ASSETS:
Investments at market value
(cost: $28,838,253) (note 1) ........ $29,276,888
Interest receivable ................... 529,134
Other assets .......................... 5,322
Total assets ..................... 29,811,344
-----------
LIABILITIES:
Accrued management fees ............... 17,522
Accrued expenses ...................... 11,153
Total liabilities ................ 28,675
NET ASSETS: (applicable to 5,207,311
shares outstanding: 20,000,000 shares
of $.01 par value authorized) ......... $29,782,669
===========
NET ASSET VALUE PER SHARE
($29,782,669 + 5,207,311 shares
outstanding) .......................... $ 5.72
===========
At December 31, 2000, net assets consisted of:
Paid-in capital ....................... $41,029,721
Accumulated net realized loss on
investments, futures and
foreign currencies .................. (11,685,455)
Net unrealized appreciation on
investments and foreign currencies .. 438,403
$29,782,669
===========
STATEMENT OF OPERATIONS
Year Ended December 31, 2000
INVESTMENT INCOME:
Interest .............................. $ 3,191,702
Dividends ............................. 13,356
------------
Total Investment Income ............. 3,205,058
EXPENSES:
Interest (note 5) ..................... 382,457
Management (note 3) ................... 204,663
Custodian ............................. 77,697
Professional (note 3) ................. 37,601
Directors ............................. 28,388
Printing .............................. 20,753
Transfer agent ........................ 19,297
Registration (note 3) ................. 10,006
Other ................................. 5,865
------------
Total expenses ...................... 786,727
Fee reductions (note 4) ............. (10,817)
Net expenses ........................ 775,910
------------
Net investment income ............ 2,429,148
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS, FOREIGN
CURRENCIES AND FUTURES:
Net realized loss on investments ...... (892,066)
Net realized loss from futures and
foreign currency transactions ........ (286,686)
Unrealized appreciation
of investments and foreign
currencies during the year .......... 1,635,694
Net realized and unrealized gain
on investments and foreign currencies 456,942
Net increase in net assets
resulting from operations ........... $ 2,886,090
============
See accompanying notes to financial statements.
5
GLOBAL INCOME FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
Year Ended December 31, 2000, Six Months Ended
December 31, 1999 and Year Ended June 30, 1999
Year Six Months Year
Ended Ended Ended
December 31, December 31, June 30,
2000 1999 1999
----------- ----------- -----------
OPERATIONS:
Net investment income ................................................... $ 2,429,148 $ 1,355,373 $ 2,612,869
Net realized gain (loss) from security and foreign currency transactions. (1,178,752) (1,331,847) (3,103,726)
Unrealized appreciation (depreciation) of investments and foreign
currencies during the period ............................................ 1,635,694 459,528 (616,711)
----------- ----------- -----------
Net change in net assets resulting from operations ................. 2,886,090 483,054 (1,107,568)
Additions to paid-in capital (note 6) ................................... -- -- 15,703
DISTRIBUTIONS TO SHAREHOLDERS:
Distributions from net investment income ($0.42, $0.23 and $0.52 per
share, respectively) .................................................... (2,143,663) (1,126,033) (2,656,469)
Distributions from paid-in capital ($0.16, $0.07 and $0.13 per share,
respectively) ......................................................... (797,060) (367,674) (631,413)
CAPITAL SHARE TRANSACTIONS:
Increase in net assets resulting from reinvestment of distributions
(170,363, 98,103 and 176,288 shares, respectively) (note 6) ........... 777,179 470,582 955,680
----------- ----------- -----------
Total change in net assets ......................................... 722,546 (540,071) (3,424,067)
NET ASSETS:
Beginning of period ..................................................... 29,060,123 29,600,194 33,024,261
End of period ........................................................... $29,782,669 $29,060,123 $29,600,194
=========== =========== ===========
See accompanying notes to financial statements.
6
Notes to Financial Statements
(1) Global Income Fund, Inc. is a Maryland corporation registered under the
Investment Company Act of 1940, as amended, as a non-diversified, closed-end
management investment company, whose shares are listed on the American Stock
Exchange. The primary objective of the Fund is a high level of income and
secondarily, capital appreciation. The Fund seeks to achieve its investment
objectives by investing primarily in foreign and domestic fixed income
securities, depending on the Investment Manager's evaluation of current and
anticipated market conditions. The Fund is subject to the risk of price
fluctuations of the securities held in its portfolio which is generally a
function of the underlying credit ratings of an issuer, the duration and yield
of its securities, and general economic and interest rate conditions. On
September 8, 1999, the Board of Directors of the Fund approved a change in the
fiscal year end to December 31. Previously, the fiscal year end was June 30. The
following is a summary of significant accounting policies consistently followed
by the Fund in the preparation of its financial statements. With respect to
security valuation, securities traded on a national securities exchange or the
Nasdaq National Market System ("NMS") are valued at the last reported sales
price on the day the valuations are made. Such securities that are not traded on
a particular day and securities traded in the over-the-counter market that are
not on NMS are valued at the mean between the current bid and asked prices.
Certain of the securities in which the Fund invests are priced through pricing
services which may utilize a matrix pricing system which takes into
consideration factors such as yields, prices, maturities, call features and
ratings on comparable securities. Bonds may be valued according to prices quoted
by a dealer in bonds which offers pricing services. Debt obligations with
remaining maturities of 60 days or less are valued at cost adjusted for
amortization of premiums and accretion of discounts. Securities of foreign
issuers denominated in foreign currencies are translated into U.S. dollars at
prevailing exchange rates. Forward contracts are marked to market daily and the
change in market value is recorded by the Fund as an unrealized gain or loss.
When a contract is closed, the Fund records a realized gain or loss equal to the
difference between the value of the contract at the time it was opened and the
value at the time it was closed. The Fund could be exposed to risk if the
counterparties are unable to meet the terms of the contracts or if the value of
the currency changes unfavorably. Investment transactions are accounted for on
the trade date (the date the order to buy or sell is executed). Interest income
is recorded on the accrual basis. Discounts and premiums on securities purchased
are amortized over the life of the respective securities. Dividends and
distributions to shareholders are recorded on the ex-dividend date. In preparing
financial statements in conformity with generally accepted accounting
principles, management makes estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of the financial statements, as
well as the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
(2) The Fund intends to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute
substantially all of its taxable investment income and net capital gains, if
any, after utilization of any capital loss carryforward, to its shareholders and
therefore no Federal income tax provision is required. At December 31, 2000, the
Fund had an unused capital loss carryforward of approximately $11,685,000 of
which $4,111,000 expires in 2001, $173,000 in 2003, $1,880,000 in 2004, $214,000
in 2006, $3,926,000 in 2007 and $1,381,000 in 2008. Based on Federal income tax
cost of $28,838,253, gross unrealized appreciation and gross unrealized
depreciation were $807,442 and $368,807, respectively, at December 31, 2000.
Distributions paid to shareholders during the year ended December 31, 2000
differ from net investment income and net gains (losses) from security, foreign
currency, and futures transactions as determined for financial reporting
purposes. These distributions are classified as "distributions from paid-in
capital" in the Statements of Changes in Net Assets.
(3) The Fund retains CEF Advisers, Inc. as its Investment Manager. Under the
terms of the Investment Management Agreement, the Investment Manager receives a
management fee, payable monthly, based on the average weekly net assets of the
Fund, at the annual rate of 7/10 of 1% of the first $250 million, 5/8 of 1% from
$250 million to $500 million, and 1/2 of 1% over $500 million. This fee is
calculated by determining the average of net assets on each Friday of a month
and applying the applicable rate to such aver-
7
age for the number of days in the month. Certain officers and directors of the
Fund are officers and directors of the Investment Manager. The Fund reimbursed
the Investment Manager $20,482 for providing certain administrative and
accounting services at cost for the year ended December 31, 2000.
(4) Purchases and sales of securities other than short term notes aggregated
$89,703,610 and $97,322,418, respectively, for the year ended December 31, 2000.
The Fund has entered into an arrangement with its custodian whereby interest
earned on cash balances is used to offset a portion of the Fund's expenses.
During the year ended December 31, 2000, the Fund's custodian fees were reduced
by $10,817 under this arrangement.
(5) The Fund may borrow through a committed bank line of credit and reverse
repurchase agreements. At December 31, 2000, there was no balance outstanding on
the line of credit and the interest rate was equal to the Federal Reserve Funds
Rate plus 1.00 percentage point. For the year ended December 31, 2000, the
weighted average interest rate was 5.24% based on the balances outstanding from
the line of credit and reverse repurchase agreements and the weighted average
amount outstanding was $7,294,519. The Fund participates in repurchase
agreements with the Fund's custodian. The custodian takes possession of the
collateral pledged for investments in repurchase agreements. The underlying
collateral is marked-to-market daily to ensure that its value, including accrued
interest, is at least equal to the repurchase price. In the event of default of
the obligation to repurchase, the Fund has the right to liquidate the collateral
and apply the proceeds in satisfaction of the obligation. Under certain
circumstances, realization and/or retention of the collateral may be subject to
legal proceedings.
(6) The Fund has adopted a Dividend Reinvestment Plan (the "Plan"). Under the
Plan, each dividend and capital gain distribution, if any, declared by the Fund
on outstanding shares will, unless elected otherwise by each shareholder by
notifying the Fund in writing at any time prior to the record date for a
particular dividend or distribution, be paid on the payment date fixed by the
Board of Directors or a committee thereof in additional shares. If the Market
Price (as defined below) per share is equal to or exceeds the net asset value
per share at the time shares are valued for the purpose of determining the
number of shares equivalent to the cash dividend or capital gain distribution on
the Valuation Date, participants will be issued additional shares equal to the
amount of such dividend divided by the Fund's net asset value per share. If the
Market Price per share is less than such net asset value on the Valuation Date,
participants will be issued additional shares equal to the amount of such
dividend divided by the Market Price. The Valuation Date is the dividend or
distribution payment date or, if that date is not an American Stock Exchange
trading day, the next trading day. For all purposes of the Plan: (a) the Market
Price of the shares on a particular date shall be the average closing market
price on the five trading days the shares traded ex-dividend on the Exchange
prior to such date or, if no sale occurred on any of these days, then the mean
between the closing bid and asked quotations for the shares on the Exchange on
such day, and (b) net asset value per share on a particular date shall be as
determined by or on behalf of the Fund.
On May 20, 1998, the Fund issued to its shareholders of record on that date
non-transferable rights entitling the holders thereof to subscribe for an
aggregate of 1,576,468 shares of the Fund's common stock. In connection with the
rights offering, estimated costs of $300,000 were charged against paid-in
capital. At the conclusion of the offering period, 1,576,468 shares were issued
at a subscription price of $6.15, resulting in a $9,307,467 (net of sales load)
credit to paid-in capital. Actual costs of the rights offering were less than
estimated and, as a result $15,703 was credited to paid-in capital during the
year ended June 30, 1999.
8
GLOBAL INCOME FUND, INC.
FINANCIAL HIGHLIGHTS
Year Six Months
Ended Ended Years Ended June 30,
December 31, December ---------------------------------------------
2000 31, 1999 1999 1998 1997 1996
----------- ----------- --------- --------- --------- ---------
PER SHARE DATA*
Net asset value at beginning of period .............. $ 5.77 $ 5.99 $ 6.93 $ 8.43 $ 7.92 $ 8.00
----------- ----------- --------- --------- --------- ---------
Income from investment operations:
Net investment income .......................... .42 .23 .55 .52 .51 .26
Net realized and unrealized gain (loss)
on investments ............................... 11 (.15) (.81) (1.18) .59 .23
----------- ----------- --------- --------- --------- ---------
Total from investment operations ............ .53 .08 (.26) (.66) 1.10 .49
----------- ----------- --------- --------- --------- ---------
Less distributions:
Distributions from net investment income ....... (.42) (.23) (.55) (.52) (.59) (.26)
Distributions from paid-in capital ............. (.16) (.07) (.13) (.32) -- (.31)
----------- ----------- --------- --------- --------- ---------
Total distributions ......................... (.58) (.30) (.68) (.84) (.59) (.57)
----------- ----------- --------- --------- --------- ---------
Net asset value at end of period .................... $ 5.72 $ 5.77 $ 5.99 $ 6.93 $ 8.43 $ 7.92
=========== =========== ========= ========= ========= =========
Per share market value at end of period ............. $ 4.69 $ 4.44 $ 5.19 $ 6.44 $ 8.50
=========== =========== ========= ========= ========= =========
TOTAL RETURN ON NET ASSET VALUE BASIS .............. 9.05% 2.52% (2.23)% (8.44)% 14.71% 6.26%
=========== =========== ========= ========= ========= =========
TOTAL RETURN ON MARKET VALUE BASIS (a) .............. 19.75% (8.96)% (8.85)% (15.65)% 15.71%
=========== =========== ========= ========= ========= =========
RATIOS/SUPPLEMENTAL DATA
Net assets at end of period (000's omitted) ......... $29,783 $29,060 $29,600 $33,024 $25,361 $30,865
=========== =========== ========= ========= ========= =========
Ratio of expenses to average net assets (b) (c) ..... 2.69% 2.26%** 2.45% 3.52% 2.71% 2.18%
=========== =========== ========= ========= ========= =========
Ratio of net investment income to average net assets . 8.31% 9.21%** 8.95% 8.53% 7.35% 6.55%
=========== =========== ========= ========= ========= =========
Portfolio turnover rate .............................. 259% 115% 183% 328% 475% 585%
=========== =========== ========= ========= ========= =========
* Per share income and operating expenses and net realized and unrealized
gain (loss) on investments have been computed using the average number of
shares outstanding. These computations had no effect on net asset value per
share.
** Annualized.
(a) Effective February 7, 1997, the Fund converted from an open-end management
investment company to a closed-end management investment company. The Fund
has calculated Total Return on Market Value Basis using closing market
prices and reinvestment of dividends and distributions at lower of the per
share net asset value on the payment date or the average of closing market
prices for the five days preceding the payment date.
(b) Ratio excluding interest expense was 1.38%, 1.48%**, 1.46%, 1.58% and 2.00%
for the year ended December 31, 2000, six months ended December 31, 1999
and the years ended June 30, 1999, 1998 and 1997, respectively.
(c) Ratio after custodian credits was 2.66%, 2.24%**, 2.43% and 3.42% for the
year ended December 31, 2000, six months ended December 31, 1999 and the
years ended June 30, 1999 and 1998, respectively.
9
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors and Shareholders of Global Income Fund, Inc.:
We have audited the accompanying statement of assets and liabilities of
Global Income Fund, Inc. including the schedule of portfolio investments as of
December 31, 2000, and the related statements of operations, the statements of
changes in net assets and the financial highlights for each of the periods
indicated thereon. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 2000, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Global Income Fund, Inc. as of December 31, 2000, the results of its
operations for the year then ended, the changes in its net assets and the
financial highlights for each of the periods indicated thereon, in conformity
with generally accepted accounting principles.
TAIT, WELLER & BAKER
Certified Public Accountants
Philadelphia, Pennsylvania
January 12, 2001
10
GLOBAL INCOME FUND
================================================================================
11 Hanover Square
New York, NY 10005
Printed on recycled paper [LOGO]
GIF-AR-12/00