Tuesday, April 08, 2008

Up, down, shake it all around?

I was interviewed last week for a TradeShow Week article on the impact of the current economic downturn on the exhibitions business in Asia (for more trumpet-blowing see our corporate blog). My general view is that it's too early to tell. I am, however, not particularly optimistic for the outlook for the 3 last quarters of this year.

I was interested, then, to see a piece on the China Stock Blog summarising Dr. Enzio von Pfeil's interview with CNBC. Key highlights of this piece are:

The key is that "de-coupling" is a myth. The key link is psychological. When US markets fall, everyone gets scared globally, so the sell-off continues. This will dampen consumption in Asia as discretionary consumption is very much driven by the feminine "feel-good" factor.

We are bulls of Taiwan, particularly of their tourism and transport sectors.
Food distributors should prosper, particularly if they distribute specialist foods like a certain type of rice or other grains.

See also this piece on inflation in China if you were comforting yourself that the Chinese domestic economy would save our bacon.

See you on the window ledge....it's looking very dodgy out there.

Update: more on decoupling here today. Highlights:

But decoupling has legs, and maybe for a good reason: it could actually be true. Last month, for example, Standard & Poors reported that despite the global economic turmoil, Asian economies should continue to grow at a solid pace this year. And new research from I.M.F. economists offers a more nuanced view of the decoupling-convergence divide.

No comments: