Why to Buy Emerging Markets Now

Now, when developing markets are flat on their backs, is the time for contrarian investors to look closely at them.

Thank goodness for emerging nations such as China, India and Brazil. By continuing to grow briskly, they kept the recession of 2007–09 and its immediate aftermath from turning into a global calamity. Now, however, emerging economies are slipping. In India, for example, inflation is higher than in any other large country, yields on ten-year government bonds have jumped to nearly 10%, the rupee has lost two-fifths of its value, and growth in gross domestic product has dropped from about 9% to half that. China’s growth rate is down by one-fourth, and Brazilian economists estimate that their nation’s GDP will increase by a puny 2.9% in 2013.

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James K. Glassman
Contributing Columnist, Kiplinger's Personal Finance
James K. Glassman is a visiting fellow at the American Enterprise Institute. His most recent book is Safety Net: The Strategy for De-Risking Your Investments in a Time of Turbulence.