Bridgewater Predicts Major Growth Of Asian Economies


The massive hedge fund Bridgewater that a selection of Asian countries will own the majority of stocks in the stock mark

Currently, 75% percent of world stocks are owned by countries outside of a certain group of Asian countries. This bloc of Asian countries includes China, Singapore, Thailand, South Korea, Malaysia, Hong Kong and Taiwan. However, by 2035, this bloc is expected to own the majority of stocks traded on the global stock markets.

There is an expectation that the economies in this Asian bloc will grow faster than the U.S. economy and other comparable European economies. Additionally, this expectation is led by the fact that economic growth for China does not rely on exports to the U.S. The Chinese economy has stood its ground despite increased pressure from the ongoing trade war with the U.S.

"This emerging Asia bloc already produces a level of output that is comparable to the US and Europe, combined. And in the past three years, its contribution to global growth has been 2.5 times that of the US plus Europe. Trade between these countries is a bigger portion of their economies than trade between the countries of Europe," a report published by Bridgewater stated.

"This bloc is increasingly inwardly focused and independent, reflected in its nominal GDP growth substantially outpacing exports over the past decade," the report reads. A battle for geopolitical power between China and the US has already led to sanctions, a trade war, and a ban on one of China's biggest companies, telecomms firm Huawei. 

Bridgewater's chief security officer Richard Falkenrath, who previously worked on the SARS problem for the George W. Bush administration, stated the market reaction to the Coronavirus has been "more severe" than what it was for SARS.

"At this point, the coronavirus has the potential to be the most significant medical disruption in decades, but the cone of outcomes remains wide," the note from Falkenrath reads. 

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Economics, Finance and Investing