Have you noticed recently that whatever China does, the marketplace listens. Google makes a tough decision, whether or not they will continue to comply with the censorship oversight of its search engines. Who notices? You and I. China expands its money supply. Who notices? China moves to curb lending. Who notices? Of course, we do. In years past, the U.S., Europe, along with parts of Southeast Asia were the economic drivers. Today, Europe suddenly appears irrelevant in the big picture. Nobody really cares what happens in Italy, France or Great Britain, however everybody cares about what happens in China!
The challenge here is that Europe (a transparent economy for the most part) is being displaced by China, an economy with a low degree of transparency. And as transparency declines, the chance for without warning events increases. So as we enter a new decade, I anticipate that marketplace volatility will increase, and its directly related to China becoming an increasingly powerful nation and economic factor.
