{"id":638309,"date":"2018-02-22T13:30:14","date_gmt":"2018-02-22T13:30:14","guid":{"rendered":"http:\/\/juniorminingnews.com\/?p=638309"},"modified":"2018-02-22T13:30:14","modified_gmt":"2018-02-22T13:30:14","slug":"blank-hasnt-been-this-cheap-since-2002-2","status":"publish","type":"post","link":"https:\/\/juniorminingnews.com\/?p=638309","title":{"rendered":"[Blank] Hasn\u2019t Been This Cheap Since 2002\u2026"},"content":{"rendered":"
\"Jody<\/a><\/div>\n

By Jody Chudley<\/a><\/span> <\/p>\n

<\/div>\n

This post [Blank] Hasn’t Been This Cheap Since 2002\u2026 appeared first on Daily Reckoning.<\/p>\n

Asian stocks have not been this cheap since the Asian Financial Crisis of 1997\u2026<\/p>\n

Which is a little strange because there is nothing in the economies of Asia today that even compares to the last crisis.<\/p>\n

In fact, right now the valuation spread between the MSCI Asia Pacific Index and the S&P 500 is wider than it’s been since 2002 on both a price to earnings basis and a price to book basis.<\/p>\n

More simply put, this means that the S&P 500 is much more expensive than the MSCI Asia Pacific Index as measured by P\/E and P\/B ratios.<\/p>\n

Which is why today I’m recommending you add some exposure to Asia in your portfolio\u2026<\/p>\n

The Last Time Asia Was This Cheap \u2014 The Region Was Very Sick<\/p>\n

In 1997, Asian financial markets became unglued in an event that became known as the \u201cAsian Flu.\u201d<\/p>\n

The underlying cause of the problem was a massive currency crisis.<\/p>\n

Vast amounts of borrowed money flowed into the region.<\/p>\n

And because most Asian currencies were pegged to the U.S. dollar (and therefore shouldn’t fluctuate), investors thought it would be a great idea to borrow U.S. dollars at low interest rates and invest them in Asia where interest rates were much higher.<\/p>\n

Borrow at low rates, invest at high rates \u2014 a classic carry trade.<\/p>\n

That was fine for a while, but when the U.S Federal Reserve started raising interest rates, investors who had borrowed in U.S. dollars quickly became nervous. The higher rates moved, the faster these people pulled their cash out of Asia to repay what they had borrowed in the U.S.<\/p>\n

All of that money that had gone into Asia came out at a much faster pace\u2026<\/p>\n

Asian governments quickly raised rates to try and keep cash from leaving. It didn’t work. Instead those rate increases crushed Asian economies. Countless companies declared bankruptcy and the IMF eventually had to come in with a series of bailouts.<\/p>\n

But why exactly am I reminiscing about a crisis that happened 20 years ago?<\/p>\n

Because for some reason, Asian stocks are valued just as pessimistically today as they were in 1997 \u2014 when the \u201cAsian flu\u201d was decimating economies.<\/p>\n

Today, the region is in great shape looking at steady earnings growth, strong balance sheets, rising wages, solid dividends and a bright future.<\/p>\n

Usually you have to pay a high price for such a cheery outlook. Today we can purchase Asian stocks at very attractive valuations and still get that cheery outlook.<\/p>\n

So let’s do it!<\/p>\n

Here Is How We Play It \u2014 Widely Diversified<\/p>\n

I like opportunities like this. We have an entire region of attractively priced stocks \u2014 not just one bargain company.<\/p>\n

That means that we have an opportunity to generate capital gains while spreading our investment across a diversified basket of companies.<\/p>\n

Here is my suggestion for getting some exposure to Asia’s discounted valuations \u2014 iShares MSCI All Country Asia ex Japan ETF (AAXJ).<\/p>\n

This ETF owns 653 different companies and is broken down across the following countries:<\/p>\n

China \u2014 40.2 \u2026read more<\/a> <\/p>\n

Source:: Daily Reckoning feed<\/a><\/p>\n

The post [Blank] Hasn’t Been This Cheap Since 2002\u2026<\/a><\/a> appeared first on Junior Mining Analyst<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

By Jody Chudley This post [Blank] Hasn’t Been This Cheap Since 2002\u2026 appeared first on Daily Reckoning. Asian stocks have not been this cheap since the Asian Financial Crisis of 1997\u2026 Which is a little strange because there is nothing in the economies of Asia today that even compares to the last crisis. In fact, […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"footnotes":""},"categories":[4],"tags":[],"_links":{"self":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/638309"}],"collection":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=638309"}],"version-history":[{"count":0,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/638309\/revisions"}],"wp:attachment":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=638309"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=638309"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=638309"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}