MichaelSchmichael

ABB Perfectly Positioned to Benefit from Global Infrastructure Boom

Nice analysis, but -- although optimistic -- I am not sure the infrastructure boom is quite as much of a foregone conclusion as you seem to suggest.

China, Russia and the Middle East certainly certainly have sufficient public funds for infrastructure investment, but LatAm is looking a little less promising (e.g., recent public finance issues, currency action and lower house passage of export tax in Argentina is likely to dampen investment activity). The US and Europe appear to have public finance constraints that will (or at least should) limit public spending. Where is the money going to come from -- PPP? Which banks have the capital to do these big deals? Even if the financing issues are resolved, large infrastructure investment would exacerbate the inflation problems through increased basic material demand and elevated employment. I would appreciate your thoughts on those issues.

Also, I am curious -- in your bio you reference your accurate prediction of a currency crisis in Argentina sometime in 1994 or 1995. I was aware of some limited contagion in Argentina in 1994 and 1995 from the Mexican crisis, but was unaware of a currency crisis in Argentina in that timeframe (certainly aware of the 2001 devaluation, though). To what 1994 or 1995 Argentine crisis are you referring?

Saludos.