Asia Is Slowing? Really? Thanks

This morning, the head of the Asian Development Bank officially cut his estimates for Asian GDP growth in 2008. While our inflation call has morphed into consensus, our "global stagflation" call has not. This revised estimate is another nice admission however, taking consensus closer to reality.

A few weeks back, Goldman also downgraded their Asian Equity market view on select countries. After Vietnam lost 2/3 of its value, and China was down 50% from its October 2007 peak, we gave that a golf clap. That call, like many sell side strategy calls, was a revisionist and reactive one.

Since Q4 of last year I have been calling for Asian growth to be adversely affected by inflationary pressures and social unrest, in addition to the 2nd derivative effects of a US economic growth slowdown.

Asia's aggregate GDP growth for 2007 ended up close to +9% year over year. Look for the revisionist historians to pop into your inbox day by day now, reflected on that being the top in this global economic cycle's growth.

It is global this time, indeed.
KM

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