Thursday, April 03, 2008

Mark Mobius: US recession will not hinder those emerging market stocks

MM: Regardless of how the current situation develops, we can take comfort that any bear market will not last long.

NVDL: Interesting observation. I suppose on planet Mobius, there is a doughnut centre filled with an endless supply of cheap oil. Mr Mobius, cheap energy predicates growth, and growth predicates an increased use of energy, and yet in your article, you don't mention this limit to growth a single time. And Horton hellooooo, it's clear that the game has changed fundamentally. Food, energy, everything is more expensive. That's in the developing economies too.

MM: US recession will not hinder those emerging market stocks

Moving at a snail's pace in the Dubai traffic surrounded by the sparkling lights of construction cranes, I am forced to contemplate the recent fall in various emerging market stocks.

It seems that there is strong dissonance between what is happening in emerging markets and the frightening subprime news coming out of the US and UK markets

So how can I reconcile the doom and gloom I read about in the daily newspapers and hear about from any economist I want to listen to?

My recent month-long tour of Latin America does not seem to indicate an imminent disaster.

Businessmen I talked with in Brazil, Argentina, Chile, Peru, Panama and Mexico were saying that business was good and they were planning for growth. Even in Mexico where the impact of a US slowdown is bound to be felt more than other Latin American countries the mood was sanguine.

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