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US economy will lag the global recovery

                How fast and what form the global economic recovery is no one knows for certain.  A few facts however are clear.  One of the clearest facts is that the BRIC countries GDP are again growing at mind blowing rates.  Their rate of growth is 2 to 4 times those of matured markets.  With the higher reward however, comes the higher risk (or perceived risk).

                The first problem that those countries will experience is inflation (for the exception of China).  As their GDP blows away other countries they will have to lower rates to keep that inflow of foreign money in check.  The only problem is that they tend to do the exact opposite; they will raise rates to fight inflation.  So with the higher rates, more foreign investors will seek investments until the market becomes too crowded and collapses.

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