Over the past few years, I've been imploring investors to boost their exposure to the more dynamic economies and regions of the world. Simply put, Latin America, Asia and even Africa are poised to grow at a stronger pace in the next few decades than the United States and Europe. This view stems from the steady expansion of a middle class in each of these regions. As people move up from the lower-income strata, they spend money on appliances, homes, vehicles, fast food and many other typical consumer items. This creates a virtuous cycle, whereby a range of industries sprout up to support this demand, and they in turn create many more middle-class jobs. Of course, there's a good time and a bad time to load up on stocks and funds for these dynamic markets. I'm a huge fan of countries like Brazil, Turkey, Colombia and Indonesia -- just to name a few. But these countries' economies and markets haven't fully decoupled from the United States and Europe. It's an ongoing process, and troubles here still affect these emerging markets [2] from time to time.
Instead of focusing on these markets, I'm spending more time looking at specific companies that directly benefit from rising consumer incomes in these regions. I recently focused [3] on home builder Gafisa (NYSE: GFA [4]), which continues to trade poorly but offers the potential for significant upside if the Brazilian housing market [5] firms up. (more)
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