Global Macro Investing in the BRIC's

By Dagny Taggart

Brazil, Russia, India, and China are collectively known as the BRIC nations. This name came from a 2003 paper from Jim Oneil at Goldman Sachs titled Dreaming With BRIC's the Path to 2050 and Beyond. Not a call to Buzz Light year but instead a legitimate economic theory that these four nations would go from emerging markets to huge economic growth engines that would possibly become the largest economies in the world.

Now that these nations have embraced capitalism and started to throw out corruption they are able to better compete for investment capital with other nations. Due to this and the fact that they have huge and growing populations along with large natural resources and you have a good chance for a big move on their way to power and influence.

Brazil has grown up a lot over the last 20 years. Having been called the next growth engine since the seventies it appears as though Brazil has finally figured it out and is building a legitimate economy that has a solid banking system, several industries, and a huge oil industry. Having gotten rid of the majority of its Latin American corruption Brazil is well on its way to becoming a major force in the world economy.

Russia is next and like Brazil has huge oil and gas reserves and resources. In addition to natural resources Russia also has a very educated population with many scientists. The only thing that Russia needs in order to further progress is to fully purge itself of corruption that is fairly rampant in the government, But hey when your leader is a former KGB agent what do you expect? Anyways if they can get past the Putin issue then they will become one of the most powerful economic forces in the world.

The great nation of outsourcing is up next. India long known for things like the Taj Mahal is now known for its large educated and English speaking population. Probably the number one country in the world for tech support outsourcing India is now becoming a legitimate hot bed of technology in its own right. But the thing that really sets India apart is the fact that it has such a large educated population.

The last country on the BRIC list is not last because of potential but instead just for a catchy acronym. In fact if China can manage its growth right it may become the largest economy on earth over the next forty years. China has the people and is rapidly gaining the technological know how to do almost whatever it wants. The only caution is that government does not blow out the flame, but that is looking like a lesser and lesser problem. These nations have loads of potential for not only their citizens but also for global macro investors. - 23211

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