Downturn Begins To Hit Emerging Economies

Developing countries including China and India, where red-hot growth has lifted hundreds of millions of people out of poverty in recent years, are showing signs of economic cooling as the effects of the downturn that started in the United States continue to spread around the globe.

Fears that booming emerging markets are becoming caught up in a global slowdown helped send the dollar soaring this week. Investors continue to flee juggernauts such as Russia into safer dollar-denominated investments. The shift comes as the prices for commodities from developing countries, particularly oil, drop precipitously.

Read the whole story here.

Comments

[timezone]

This domino effect around the world shows how really interdependent all nations are. Since China is our biggest lender, I'm wondering how all this will affect our economy even further. If China and other countries stop lending the U.S. money, where does that put us? I don't think most Americans know how much of our country, in one or another, is owned by foreign interests.

[Rule Of Law]

When we devalue our currency and offer our creditors these new dollars as partial payment on the record debt that Bush has run up, the banks will yet again make out like bandits, using essentially worthless paper to pay off our lenders on Brazil style structured repayment programs where pennies on those dollars will look attractive enough to take.

At that point, we will have truly become a third world country.

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[EinChicago]

Did anyone not see thsi coming? Seriously? Was anyone dumb enough to buy into the "decoupling" malarkey? The emerging economies growth was fueld by providing cheap crap to the first world consumers. Without the first world consumers, the emerging economies are left as producers of cheap plastic trinkets nobody wants to buy. And of coursze that make sinvestros skittish, because while in teh US and Uk you have a culture of corporate bailouts, in countries like Russia and China, the historical model when things get bad is for the state to take away whatever foreign countries own in teh form of nationalization and the like.

I'm hardly a fan of the free market or a right winger, but as a realist, anyone could see this pattern coming down the pipe.

[MetalCanuck]

PEople are being sucked by market manipulation and buying the dollar.

[MetalCanuck]

Suckered I mean

[pmag88]

you were right about them vampires the first time. (-;

[DAE]

As the article suggests, China's ace in the hole is its underdeveloped domestic market, and the immense needs for environmental protection and infrastructure. Another undeveloped resource is its credit sector. These factors helped fuel the American economy for half a century. The Chinese are smart enough to adjust their economy from an export model to an internal market model. This should fuel their economy for decades to come.

[motley2]

DAE, Do the Chinese spend like us, or love credit like us? Or are they frugal, like the Japanese?

[Tom95134]

Most Asian consumers are pretty conservative and make a serious attempt to buy with cash. Japan has, because of the U.S. influence become a credit card society but still conservative. China has a long way to go and for the most part is a cash society. Only the upper class use cards.

[rollingdivision]

Normal business cycle.

[motley2]

with a lot more people along for the ride...wheeee

[rollingdivision]

Yes, but not a surprise.

[theeconomicfractalist]

13 September 08 Asset Valuation Fractal Progression

Rotational asset valuation time based quantum fractal progression describes the complex macroeconomic system in terms of either ongoing money and credit expansion or in terms of, as is ongoing now, the world's greatest ever - much greater than the decade that followed 1929 - money destruction and collapse. Bonds, the US dollar relative to other currencies, summation equity indices, the CRB, and the CRB's proxy 'gold' are all following quantum Lammert valuation growth and decay fractals. Saturation growth of terminal lower high areas within larger time scale decay periods can be identified with the use of Lammert fractals of shorter time unit duration. An ongoing example is the last six trading days of the Wilshire; with a first fractal of 31-32 15-minute units units made of a 5/13/10/7 x/2.5x/2x/1.5x 15-minute unit subfractal progression. The second fractal is about 77 15-minute units in length with the readily identifiable nonlinear collapse at its terminal portion and the third fractal about 52-53 15-minute units in length or about 1.6 times the first fractal length. Fibonacci relationships come into play for third growth fractals in major larger scale decay periods and near the terminal portions of final asymptotic decay areas. Accelerated decay in a larger time scale fractal pattern lies immediately ahead for the great Wilshire.

[DFL]

THE WHOLE WORLD IS LOOKING FORWARD TO THE END OF THE LONG DARK NIGHT OF THE BUSH / GOP ERA

[lisakaz2]

Except for the stooges who think 4 more years of this garbage is just fine. Can't you wait till we attack Russia and Iran?

[jinjinpinti]

Sort of makes you glad there IS an electoral college, eh?