While the world has been used to the U.S. being the engine that drives global economic growth, this decade we witnessed the resurgence of developing nations with popularized terms such as “Chindia” (China/India) and “BRICs” (Brazil, Russia, India, China). There has truly been a shift in importance coming from developing nations and it is showing on multiple fronts, including share of world market capitalization. The U.S. share of world market cap has fallen from roughly 45% in 2003 to 29% currently, while China’s share has risen from roughly 1% to 9% over the same period. The second chart, of the U.S. dollar, shows how the currency markets are responding to U.S. weakness.
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