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Piece in Barron's today emphasizing India's dependence (much greater than most emerging markets) on foreign investment, which has pulled out. Predictions are impossible, but I'd guess emerging generally will be a good place to be when world markets find their lows. Based on GMO's research on bubbles, there's likely to be a new low for US, world indexes in 2009.

A new bull market, Morgan Stanley's Desai argues, is at least 15 months away. "Even if we assume that the market has hit its bottom, previous bear markets show that the market almost always tests the previous low before a new bull market gets underway," he says. "This process of retesting took between 15 and 24 months in the previous three bear markets."

He says the Sensex will probably end 2009 at 8,559, down 11% from now -- and it could fall as much as 34%. In a bullish scenario, Morgan Stanley says, the market could climb about 30%.
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The economists Reinhart and Rogoff had a timely and interesting historical study on financial busts a year ago. Here's their more recent paper highlighting the aftermath of systemic banking busts. There's a summary in the 'frontline thoughts' letter below, with graphs for duration and depth of the downturn. This work makes the idea of a lasting low in 2009 seem a little optimistic.

And here's the paper itself, 11 pages and relatively clear
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