Updated 2 Feb 2014

Emerging Markets

 

INVESTMENT VIEW

  • What’s new?

    • FX: ...

    • Rates: ...

  • What’s next? 

    • FX: Recognition that there is no silver bullet that will solve the systemic - and idiosyncratic - problems facing EM. It will be a while until risk-on environment returns. 

    • Rates: ...

  • Quick links:

 

Thailand ThaiGBs

Thailand ThaiGBs

Key political actors

Key political actors

Electoral voting patterns (2011)

Electoral voting patterns (2011)

Democrat Party votes (2011)

Democrat Party votes (2011)

Elections Factsheet (CNN)

Elections Factsheet (CNN)

 

KEY ISSUES + CONTEXT

 

Differentiation: Not all EMs are created equal

 

  • Classification: When armchair economists run out of useless acronyms and monikers to classify countries (e.g. BRICs, MINT, Fragile Five, TIPs), we create more helpful groupings. This one mentioned (by WSJ, 4 Feb) but seen in variations elsewhere is useful: 

    • Mismanaged: Argentina, Ukraine, Venezuela. This group faces currency crises due to government policies, as exemplified by Argentina’s recent depreciation of the peso amid runaway inflation and a thriving black market in its currency.

    • Living beyond means: Turkey, South Africa, Thailand, Indonesia, Chile, Peru. These nations boomed on cheap credit and unsustainable consumption, which led to a surge in imports. As global monetary policy tightens, these nations will find it harder to finance their large current account deficits.

    • Weak banks: Hungary, Romania, Bulgaria. These countries’ banking systems are still fragile as institutions focus on repairing their balance sheets.

    • Domestic structural problems: India, China, Brazil, Russia. This group faces challenges to revamp their economic models. China, for instance, needs to rely less on state-led investment to fuel growth. India needs to allow more foreign investment. Brazil and China also face excessive credit growth.

    • Brightening outlook: South Korea, Philippines, Mexico, Poland, Czech Republic. Some of these nations have taken steps to overhaul their economies and reduce debt. Others, like South Korea and Mexico, should benefit from a pickup in demand from the U.S.f

 

 

OTHER KEY ISSUES

 

  • ...

 

 

GOOD READS + BIG IDEA + OUR TAKE

 

  • Turmoil in emerging markets: What’s missing from the story? (Kristin Forbes /  MIT, 5 Feb)

    •  

      The strikingly different reactions to the ‘taper talk’ and ‘taper start’ suggest that the simplistic storyline about what is causing recent volatility in emerging markets is missing something. This column argues that we need to add three important considerations: 1) The role of global growth and uncertainty; 2) The role of country differentiation; and 3) The role of domestic investors.

 

 

KEY RESOURCES

  • Government

    • Bank of Thailand: Home, ...

  • Thai Bond Market Association (TBMA)

  • Thailand Development Research Institute (TDRI)

  • World Bank: Economic Monitor (2012), ...

 

 

 

News Scan ("Thailand")

 

 

Recent News

  • Five groups of emerging markets to watch (WSJ, 4 Feb)

 

What do others say? Selection of remarkable quotes + views from commentators worth following:

 

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  • ...

 

CONTACT US

Email: strategist@emgist.com

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