Global Economy - June Park 3/20/08

Things that will improve the macro environment:
1. US stimulatory measures must yield tangible results.
stimulatory measures include rate cuts, tax rebates. These measures are already yielding positive results.
2. Decreased fear of US downturn.
3. Stabilization of Fed Fund Rates
4. Weak dollar trend and increase in commodity prices will have to reverse.
5. Decreased inflationary pressures in China
6. Increased confidence in the global economy.


If these things happen in this order, economists (or at least June Park of WIS) believe that the Korean economy will take a turnaround. When we look back at history, there have been 3 instances when the Korean stock market took a major turnaround. It was in 1992, 1998, 2001, and 2003. Many things that happened before the turnaround are happening right now, except abundant liquidity.

They are estimating that the macro variables will turn positive around May, which is only 2 months ago, or at least from the 3Q..

American economists and strategists are busy selling off their shares and investments because they believe that the worst is still to come. What or where are Korean analysts getting their data? It's almost completely different. Everyone in Korea are out to buy more stocks. All the analyst reports of companies are encouraging investors to keep buying stocks, that stock prices will rise in the near future. If you take a look at FnGuide, where there is a database of company analyst reports, it's full of BUYS.

Who will reap the benefits or consequences of our economy?
Who is right, the foreign or Korean analysts? Probably the foreign ones..

But if that's true, what is their basis for all this....

If the economy really keeps going down, Korea will be receive a big blow..all the investors nationwide will suffer.