Harvard’s Reinhart Says Emerging Markets Are in Tougher Spot Than During ‘08 Crisis

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While money managers from Goldman Sachs Group Inc. to UBS Wealth Management still tout investing opportunities in emerging markets, the asset class has one notable critic: Harvard professor Carmen Reinhart. The Cuban-born economist points to mounting debt loads, weakening terms of trade, rising global interest rates and stalling growth as reasons for concern, Bloomberg News reported. In fact, developing nations are worse off than during their two most recent moments of weakness: The 2008 global financial crisis and 2013 taper tantrum, when equities endured routs of 64 percent and 17 percent respectively. "The overall shape they’re in has a lot more cracks now than it did five years ago and certainly at the time of the global financial crisis," Reinhart said from Cambridge, Massachusetts. "It’s both external and internal conditions." Read more.