The Alchemist - Dragons v Tigers, revisited

For many across the world, it was probably the Beijing Olympics when it dawned where future global economic and political power really lay.

Then came the hype ahead of the Year of the Dragon, coupled with the onslaught of macroeconomic data strategists like to spray about in support of their recommendations. A recent example: the expansion of China’s domestic capital markets, where the ‘A’ Share market capitalisation increased more than 10 times in the five years to the end of 2009. China has quickly embedded itself in investors’ psyches. A couple of weeks ago, when most markets were watching what move the US Federal Reserve might make, many hedge funds were focused on the Bank of China. “Yes, the Fed is still the most power...