Emerging markets vs. domestic markets. Now that the
horse has left the barn is it really time to close the
doors? The day after the Fed meeting last week Thursday's -
emerging markets (
) hit a low against the S&P 500 (
) that took it the final thrust level it hit on October 24
2008 in the midst of the global crisis.
The move on Thursday was based on the anxiety of large
capital flows that would soon flee emerging market assets are
large investors close out carry trade positions.
Today, listening to too a bunch of guys sit around and tell me
that Brazil has problems now when Brazil is down 45% since 2011,
or -25% since March 2013 doesn't do me any good at this
Where was this analysis 3 months ago?
Remember as you look at charts that are now extreme, emerging
markets always bottoms first just as it tops first.
Emerging markets bottomed on October 27, 2008 while the
S&P 500 went into March of 2009. I have made too many
inaccurate calls on a bottoming of emerging markets vs. domestic
markets in this recent run of underperformance to be getting
righteous about the current level being a table pounding moment,
but of course I never thought we would hit the extreme of
We hit it last week. Emerging markets (EEM) have rallied
almost 2.5% vs. SPY since Thursday and while no move like this
can call a bottom of a trend, the charts have to be