Last week was the first week of foreign investor net buying since May. Given the negative sentiment and depressed valuations, this is a positive factor. Although a positive week doesn’t make a trend, Asia remains the best long-term bet for investors. Read More

Economic numbers, like the markets, are stretched to the downside, and it shouldn’t be too shocking to receive a positive surprise in economic activity early in 2009. This may not be the economic bottom, but it should put a floor under the extremely distressed global economy. Read More

Not long ago investors had few qualms about paying 30 times earnings for almost any company; the dot-com frenzy was in full swing, and prevailing sentiment suggested that the new technology boom would allow companies to enjoy endless years of strong earnings growth. Read More

It’s clear that the turn toward socialist-oriented solutions is now becoming reality. US authorities are in full socialization mode, where the capitalist model is being thrown out of the window. Look at the actions, not the words. The more irresponsible a company or individual has been during the past 10 years, the better its chances of being saved. Even the grotesque US automakers will be bailed out, for the nth time. Read More

There will be many twists and turns for the Chinese economy as well as its society, but it’s gradually becoming clear that China’s model of development has worked well. And there’s no reason it won’t work in the future. The country’s adaptability to the changing world seems extraordinary--although it helps if you’re one of the main drivers of these changes. Read More

Asia ex-Japan now trades at 6.9 times earnings, below valuation floors met during both the 1974 (7.1) and 1982 (7.4) recessions. The market’s severe selloff is as big as occurred during the 1998 Asian Crisis as well as the 1982 drop of 58 percent. Only the 1974 fall was bigger in magnitude, when Asia’s inflation was 25 percent. All this is happening at a time when Asia is in much better position than ever before to absorb the consequences of the collapse of the western banking system. But commentary on the demise of the emerging economies and expressions of doubt about their future ability to perform is as fashionable as ever. Read More

When it comes to Asia, the turmoil from the credit crisis has taken us to the brink of the worst bear market in the last 35 years. The positives for the markets right now are the cheap valuations, the bearish sentiment and the efforts by governments around the world to prevent an outright collapse of the financial system. Under different circumstance, the first two would be sufficient to justify an outright “buy” recommendation, but the third holds the key. Read More

The eventual outcome of the current turmoil, provided a depression is avoided, will be that economic growth leadership will shift to the East. Long-term readers know that this is the main idea of this publication. The only difference is that what I thought would take years to materialize will now take place much more abruptly. One only wishes that China’s leaders are ready for such a responsibility. Read More

Practically everyone is afraid, and rightfully so. The global economic system seems unable to keep itself from falling into the abyss, and investors are liquidating everything in sight. As a result, any attempt to rationalize actions is futile. Read More