GLOBAL ECONOMICS AND POLITICS

Leo Haviland provides clients with original, provocative, cutting-edge fundamental supply/demand and technical research on major financial marketplaces and trends. He also offers independent consulting and risk management advice.

Haviland’s expertise is macro. He focuses on the intertwining of equity, debt, currency, and commodity arenas, including the political players, regulatory approaches, social factors, and rhetoric that affect them. In a changing and dynamic global economy, Haviland’s mission remains constant – to give timely, value-added marketplace insights and foresights.

Leo Haviland has three decades of experience in the Wall Street trading environment. He has worked for Goldman Sachs, Sempra Energy Trading, and other institutions. In his research and sales career in stock, interest rate, foreign exchange, and commodity battlefields, he has dealt with numerous and diverse financial institutions and individuals. Haviland is a graduate of the University of Chicago (Phi Beta Kappa) and the Cornell Law School.

 

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SPRINGING A QUESTION: ARE EMERGING STOCK MARKETPLACES IN BLOOM? © Leo Haviland April 9, 2013

Many wizards praise emerging marketplace countries such as China as engines for international prosperity. The worldwide scope of the 2007 financial (economic) crisis and the following years emphasizes the close interconnection of the economies of advanced nations and key emerging (developing) countries around the globe. Historical review from the dawn of the global economic disaster up to the current time reveals price and time parallels between the trends of emerging stock marketplaces and those of the US (and related stock arenas in Europe and other advanced nations). Therefore, the bear trend since spring 2011 in emerging marketplaces is a warning sign to the S+P 500.

Maybe emerging stock marketplaces will resume their bull trend alongside a continuing climb by the S+P 500. However, the downturn within this flock of emerging countries is widespread. Note also the similar fall in commodity prices in general. Such considerations indicate that a return to the bull side by stock marketplaces of emerging marketplaces in general is unlikely. Although relative to their dismal appearance of autumn2008/winter2009, emerging marketplaces may seem to be in full flower (“still looking pretty good”), their bloom has faded substantially and suggests potential for further withering. Not only have stock benchmarks of developing nations in general been a bear trend, but also they established additional interim tops in early 2013. This underlines the significant potential for a notable decline in the S+P 500 in the relatively near future.

Chart--Emerging-Stock-Marketplaces-(4-9-13)

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Chart- Emerging Stock Marketplaces (4-9-13)
Springing a Question- Are Emerging Stock Marketplaces in Bloom (4-9-13)