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BRIC Nations On The Rise - Mike Swanson (01/29/10)

Last year we saw one of the worst bear markets ever in the stock market. However, we recently have seen a big rally in the markets that created forty percent rally in the S&P 500. The stocks that went up the most in the rally though are ones linked to the so called emerging market BRIC countries. If you know how to read stock charts you can see this clearly.

Take the first four letters of Brazil, Russia, India, and China and you will get the word BRIC. You are going to hear this word more and more, because these four countries are going to experience the most economic growth going forward. That is why the stocks of these countries have gone up so fast off of the recent low in the stock market.

An analyst at Goldman Sachs first put the letters together BRIC in 2001. He said that the BRIC countries would see their economies grow to become bigger than the biggest world economies as they are right now. He said buy investments in those countries to get in on the growth.

It is about being in the right place at the right time. For example Japan currently is the second biggest economy in the world. By 2050 economists expect that Japan will slip to become the eighth largest economy in the world while India will rise from being the twelfth biggest economy to third.

The United States is even expected to slip from its current number one spot to number two by 2050. It will be passed by China, which has the most number of people living it in the world. China is already experiencing high economic growth and its stock market was among the best performing stock markets in the whole world over the past five years.

No one thinks about Brazil much in the United States, but Brazil is quickly becoming a global economic powerhouse. Brazil's economy grew in the first quarter of 2009 while US GDP shrank 5.5% as a result of the global recession. Brazil hasn't caught that flu.

All of these economies are also linked to high commodity growth and the US of energy. The leaders of these countries recently met with the help of Russia to coordinate and work together in a high level economic summit last week. All eyes are on them, because they are the future.

Even people in the United States can invest in the BRIC nations. On the US stock exchanges there are some funds that invest in the countries that investors can buy. There are also several hundred stocks that trade in the US that are from these countries. The potential to profit is enormous. Making money is all about knowing the trend and getting in on it.


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Hello. My name is Mike Swanson. I’m the best-selling author of the book Strategic Stock Trading. In a former life I used to run a hedge fund from 2003 to 2006 that generated a return of over 78% during that time frame. In fact it was ranked in the top 35 out of 5,000 hedge funds in 2005.

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