Emerging Markets Outlook
Identify global trends and domestic fundamentals that are shaping emerging market economies, uncovering underlying risks and market opportunities.
Brazil: Off Course
We are downgrading Brazilian equities from neutral to underweight and maintaining our underweights in Brazil's domestic bonds and sovereign credit within their respective EM portfolios. Go long Brazil…
China And EM Profitability: A Floor, Not A Launch Pad
Outside semiconductor stocks, EM/China profitability has been well below both their US peers and the levels that prevailed during the EM structural bull market in the 2000s. Over a 3- to 5-year horizo…
What Really Ails China
China does not produce too much. It spends too little. The only viable way for China to reduce investment without raising unemployment is by lowering national savings. Doing so is likely to be politic…
Charts That Matter: Zoom Out. Watch The Extremes
Global equities have reached extremes on multiple measures, none of which are reliable timing tools. But imbalances in economics and investing can build for far longer than rational analysis would pre…
Korea To China Tech Rotation: How Enduring?
As a short-term (0-3 months) trade, go long an equal-weighted basket of Chinese Investable and A-shares / short the KOSPI. This is a bet on mean reversion. We do not recommend that medium- and long-te…
Mexico: An Export Boom Without A Productivity Lift
We continue to overweight Mexican stocks, local bonds, sovereign credit, and currency within their respective EM portfolios. Also, stay long Mexican equities / short the S&P500.
