Everyone agrees, emerging markets are the new, new thing. But assessing the altered global economic dynamics and growth patterns requires specificity and incisiveness, not blind fervour that an Asian century beckons as the West enters potentially terminal economic and geopolitical decline. The big emerging markets, especially 'Chindia' among the BRICs (Brazil, Russia, India and China), and a few others - including Indonesia and Turkey - are the focal points. As fault lines in China's export-led growth model emerge, bigger bets are being placed on India's enormous potential. But, in truth, intrinsic differences shed more light on the BRICs than similarities. Applying generalisations and 'group-think' to emerging markets, India in particular, is misguided, given the already high expectations, asset prices and challenges.
First, caution about developed markets and optimism about emerging markets is justified. The 2008-09 global crash and ensuing recession exposed severe balance-sheet stress across the world's 'rich' countries, which proved to be poorer, more indebted and incapable of growing as fast as previously believed.
