US Investment Opportunities

There are two specific things that could still happen to spoil the party. The first is that if the US investment market should implode under the pressure from new dot.com worries, it would send every dollar investor scurrying back to Wall Street because of fears that a new assault might be imminent on currency valuations south of the border (and everywhere else, for that matter).

US Investment Opportunities & Bill Clinton

The second possibility is that a new wave of hard-line Republican sentiment in the United States might encourage the new president to adopt a tougher attitude toward the Latins, who have had a generally co-operative ride from Bill Clinton’s Democrats up till now - and that central and South American share prices could suffer the heat from the White House’s wrath. This last worry has been one of the factors that have been driving down the east Asian markets in the last few months, so we’d be rash to suppose that it absolutely couldn’t happen.

In short, we’re not out of the woods yet, and we would do well to wait for a bit before we commit ourselves in any big way. It seems to be generally true that the balance of global emerging-market funds is now tilting back toward America’s backyard and that Latin American risk valuations have (quite rightly) improved in relation to other parts of the developing world.

But that old liquidity problem keeps on coming around and spoiling everything. What comes rolling in can so easily go rolling out again. And this is something that, like it or not, we may have to get used to.

For more relevant news items and magazine articles please click the links below:

Article: Investing Abroad

Article: UBS Under Attack

News: Stanford Launches Robust Defense in Fraud Case

Article: Silver Lining for Zurich Bank International (what Credit Crunch?)