Roach on resilient Asia

As someone with a lopsided head myself, I got to love this crooked face.

Fabled Stephen Roach in the FT. He decouples as chairman of Morgan Stanley Asia and joins the faculty of Yale this summer.

Roach is famous for his bearishness.

Here, he's pretty bullish.

Three lessons stand out from his three years in Asia, he says:

First, Asia learnt the painful lessons of the 1997-1998 regional crisis very well

Hence, the huge build-up in reserve currencies.

Second, there is the China factor.  As I have criss-crossed the region, there has been no mistaking Asia's new China-centric character.

Another frequent theme here.

Third, Asia cannot presume that just because it weathered the global crisis it has discovered the holy grail of economic prosperity.  In an increasingly complex and integrated world, trouble has an unpredictable way of mutating.

I'm on board for all three judgments, as readers of this blog will attest.

Roach notes that in the late 1990s, exports made up 35% of GDP among developing economies.  Now it's 45%. Asia has a "full plate," says Roach, when it comes to the rebalancing issue.

I also concur with Roach's concluding fear, something I've been saying for the past decade actually:

But I leave Asia with one big worry--that the rest of the world doesn't get it.  I worry, in particular, about the steady drumbeat  of China-bashing in Washington--especially as we approach mid-term elections this year.  

Thus Roach heads off to academia to change some minds as best he can.

We can only wish him well, cause they come no smarter.