One of the major themes that keeps coming in portfolio manager interviews here at TWST is the emphasis on emerging markets. We spoke to Lou Gerken this week, of Gerken Capital Associates, who told us a little bit about where Emerging Markets, particularly in 2008, are headed:
Mr. Gerken: Our medium- to long-term outlook for the Greater China and Latam regions is quite positive, with 8%-9% GDP growth for China and 4%-6% for Latam. Although rising in the first half of 2008, we anticipate manageable levels of inflation and unemployment, given the soundness of emerging market government balance sheets and their inherent flexibility to react. We believe the 2008 investment climate and beyond will be different in that “rising tide” investing of the past several years is all but over, as emerging market companies have reached valuation levels of their global peers, and where asset managers must now be active in managing portfolios and discriminating in what they buy and sell, putting the premium on alpha.
For the complete interview with Mr. Gerken, including a complete overview of their investment philosophy and stock picks, click here.
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