The stock markets are filled with opportunities right now. The slump in stock prices isn’t a reflection on the underlying companies; it’s a reflection of the need to raise capital and the desire to avoid risk. The tide in the stock markets has well and truly gone out….but it won’t stay out forever.

Take Japans Nikkei index. Today, almost 20 years after Nick Leason worked his magic, the index is still down over 75% from its 1989 high…and share prices have recently fallen to levels that many are calling absurd. The average price of the index in total is slightly UNDER one times book value. This is just a ridiculous state of affairs for one of the most advanced economies in the world. But with the memory of the 1990s rout still fresh in the minds of many Japanese investors, the words “it can’t go any lower” have been banished from the collective consciousness for at least a generation.

They know the painful truth….stock and property prices can fall further than anyone thinks possible in the after math of a bubble…a lot further. Yet, with undoubted fear across many global markets, this is a once in a lifetime opportunity to pick up shares at prices not likely to be seen for a generation….and it’s not only in Japan. In emerging markets from Russia to Malaysia to Brazil, valuations are completely out of whack with normality.  The growth stories may have stalled in these economies, but the longer term demographic and developmental trends are still firmly in place.

While the future may not be bright in the stock markets of the western world, soon emerging market economies keep their savings for themselves and invest in their own productive capacity. They will redirect their cash away from the US and other western economies that desperately need it to keep their consumption based economies from total collapse.  Once they do, the west will cease to be a drag on the global economies and the emerging markets will witness a boom never before seen in the global economy. Grab your share, before it’s too late.

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Tags: Bargains, Econonmy, Nikkei, Property Prices, Stock Markets, Stocks and share, World Economy