The new consensus is that emerging markets are lower risk than developed markets - they have more favorable demographics and more sound fiscal policies.
They also have more colorful politicians.
This - the best quote in Wolfensohn's book - should give believers in the new consensus pause:
In early 1997, I met with the Indonesian President Suharto in Jakarta. The president asked me ... what I was doing raising the subject of corruption as an issue. I told him we couldn't talk about development without addressing corruption. He replied, "Well, you come out here from Washington with these high ideas to tell us about corruption. But what you call "corruption" I call "family values".
This reminds me of a recent article about a TV producer in Russia. They tried to adapt US/British shows to Russia. The one that translated best from a cultural standpoint was a Survivor-esque show. The cunning and hustling required to win was believable to the Russians because that is how they live their lives. The adaptation of The Apprentice on the other hand was a huge flop. The Russians weren't interested in seeing someone work and play by the rules to get ahead. They thought it was a complete farce. There's also plenty of "shock" on author's behalf about how normal the corruption seems.
Then again, the article was written by a British guy on his experience. It is a good narrative to publish in a magazine. While maybe not entirely, I suspect that the nuance of Russian culture compared to the West is reasonably captured by the author. I certainly don't see myself capable figuring out how to safely invest in Russia.
article - http://www.lrb.co.uk/v33/n03/peter-pomerantsev/diary
This book might set things in perspective.
Asian Godfathers: Money and Power in Hong Kong and Southeast Asia
by Joe Studwell
@ Andrew - at the end of 1998 the RTS was at 50. Now it's at 1900. You don't need to watch the UK TV guys. You needed to look for value and buy it.
What you call corruption, I call family values - LOL. That is awesome!
True, "family values" is probably seen in the Indonesian context as "community sharing", "doing right by your friends and family", and is the moral high ground.
Whereas Americans work to win and be number one, this is anathema to Indonesians where success is shared, not hogged, by the stronger top dogs, and the symbolic token of appreciation of a job well done, or sharing in the profits, is not [seen as] corruption, but just plain old-fashioned respect.
These days, where trump shows that might is right, the rules is seen as a tool by the elites to entrench the power of the rich and powerful (in Soeharto's context, the powerful US interests against indigenous Indonesians with "family values"), instead of justice or equality for all.
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