Universal truths of investment turned upside down

Developed markets once offered security and income, while emerging markets offered rapid growth, says Matthew Lynn. But thanks to the global crisis, that's all changed.

Some things have always seemed universally true in the financial markets. Never invest in an airline. Currencies that end with a vowel always end up being chaotic. Nobody ever went broke because they had too many Swiss francs. And, perhaps most universally of all, that emerging markets were for rapid growth, but the developed markets for security and income.

The first three are still true. But the final one is about to change and may have already done so. The developed and emerging markets have traded places and it is now the new nations of eastern Europe, Asia and Latin America that offer more security and a higher income for investors than the old world of Europe, America and Japan. For the markets, this is a seismic change.

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Matthew Lynn

Matthew Lynn is a columnist for Bloomberg, and writes weekly commentary syndicated in papers such as the Daily Telegraph, Die Welt, the Sydney Morning Herald, the South China Morning Post and the Miami Herald. He is also an associate editor of Spectator Business, and a regular contributor to The Spectator. Before that, he worked for the business section of the Sunday Times for ten years. 

He has written books on finance and financial topics, including Bust: Greece, The Euro and The Sovereign Debt Crisis and The Long Depression: The Slump of 2008 to 2031. Matthew is also the author of the Death Force series of military thrillers and the founder of Lume Books, an independent publisher.