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Emerging Markets: The World's Innovation Lab
In the late twentieth century the emerging economies operated much as they had in the early twentieth century. The largest sector in the MSCI Emerging Markets Index, after financials, was materials. Put another way, the companies that extracted the emerging markets’ mineral wealth for export to the developed markets accounted for about a fifth of the emerging markets’ publicly traded
Our Latest Views on the U.S. - China Trade Dispute
In my December issue of Sinology (“A Truce Over Steak and Malbec”) I wrote that “prospects for real progress on substantive issues with China are now better than at any point in the Trump administration,” because Trump recognized that “a trade war with America's largest trading partner would damage the U.S. economy and equity markets, and thus the president's re-election
As Populists Rise, Latin America’s Economies Will Fall
In the space of a year, populists with autocratic tendencies have taken office in Mexico and Brazil, and laid the groundwork to return to power in Argentina. With the three largest economies in Latin America destined for further mismanagement, the prospects for growth in the region are dim. LONDON – Though US President Donald Trump tends to grab most of
Brexit Update: New Developments Raise No Deal Risks
Two important political developments in the UK over the last week have raised new questions about the Brexit outlook. While there’s still time for a compromise to be reached, we think the risk of the UK leaving the EU without a deal has increased. Last week’s dramatic events were not entirely unexpected. First, Prime Minister Theresa May announced that she
Risks From International Tensions Continue to Grow
summary In Europe, The Politics Thicken Businesses on Tariffs: Wait and See The Price of Trade Protection The European Union (EU) is a political and economic union borne after World War II of a desire for harmony in a scarred and divided European continent. The original concept was founded on the hope that it would “make war unthinkable and materially
China and US: Tug of Trade War
Shamaila Khan: So for the last year or more we’ve had this constant conversation about the trade war between the United States and China. What is your opinion on what is happening, and your expectations on how things are going to play out? Mo Ji: For the near term, [a] trade deal is still expected by the two sides, maybe
What Could Move the Markets Next?
Markets are not too expensive, or too cheap. As Russ explains, that offers a clue into what could cause the next move. Stock markets have been more wobbly of late. While the proximate cause was an unexpected deterioration (collapse?) in trade talks with China, many investors were getting nervous even before the most recent barrage of tweets. Some were understandably
Evaluating the Effects of China’s Pork Crisis
African swine fever is ravaging China’s pork supply and having a global impact on protein prices. For equity investors, the crisis serves as a reminder that even amid trade-war uncertainty, research into domestic trends can help investors access the country’s vast stock market. China is a pork-loving nation that produces and consumes about half the world’s pig meat. That’s why
Market Reaction to Tariffs Misses Larger Opportunity in Asia
The latest tariffs in the U.S.-China trade dispute may be giving investors a second bite of the cherry! The U.S. government hiked the tariff on US$200 billion of Chinese exports to 25% from 10%. In response, China raised tariffs on nearly US$60 billion of U.S. goods to as high as 25% from around 10%. The expansion of tariffs is of
Emerging Markets: Widen Your Lens Beyond Trade Tensions
Emerging markets were up pretty sharply through the beginning of May: about 13% for equities, almost 7% for debt. Part of that was because of this consensus that developed that the US and China would reach some agreement on trade and there might be some historic handshake that would resolve their differences. On May 5th, President Trump tweeted his intention