Mexico has reportedly elected a new leader, the opposition candidate
from the former ruling party, who is promising to put the country back
in the big leagues of emerging economies. We'll talk to author of
"Breakout Nations: In Pursuit of the Next Economic Miracles," Ruchir
Sharma, about what it takes to be an emerging economy and where some of
the up-and-coming countries are likely to emerge from.
The last decade was a great decade for emerging market economies. Mr. Sharma points out that pretty much every single one of these countries did well, between 2003 and 2007, where the average GDP growth rate in these countries almost doubled. The peak was in 2007 when only three of the world's 183 economies contracted...it gave birth to investment opportunities, economic miracles, and of course acronyms - the BRICS most famously, but also the MINTS, the CIVETS.
But even if developing countries lend themselves to acronyms our guest says they can't be lumped together economically - each tells its own unique story. Not only that, but now as some of the fastest growing emerging markets mature, and global growth slows with easy money liquidity drying up, and with central bank stimulus possibly reaching the end of its rope at a time when crises in Europe, for example, are dragging economies down, where could the NEXT emerging market boom come from? Who are the up and comers?
And let's talk commodities, specifically industrial raw materials, which slipped today on concerns about growth and future demand...reportedly. As our guest, Ruchir Sharma puts it, the game of economic growth is one of snakes and ladders: one step forward, and two steps back. So, looking ahead, what do those countries climbing up vs. sliding down mean for commodity prices? And are central bank's efforts at stimulus through QE and LTRO's game changers? We'll talk about it.
Eurozone data out today shows unemployment hit its highest level ever, and manufacturing shrank last month. A UK politician warns the monetary union has turned into the titanic...lacking in lifeboats. But are there a few nations in the region floating under the radar sure to score a seat and row out of this crisis? Ruchir Sharma has some advice. He says that when the wind is no longer at your back, its time to start rowing!
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