Not as Good as They Look
Inflation will hurt emerging markets.
For most economic analysts, the past is the present. It is a popular sport to find historical parallels with the current period, and the strong consensus now is that 2010 has 2004 written all over it.
After all, 2004 also was the second year of a global economic recovery. The Chinese economy was also overheating, and authorities there were tightening monetary policy. Following a volatile first half, the year ended up being relatively benign for financial markets as fears of inflation subsided in China and the global economic recovery rolled on uninterrupted. Analysts expect 2010 to unfold in a similar manner. Read more…