Emerging markets are showing mature markets a clean pair of heels, as can be seen from the rising trend line of the MSCI Emerging Markets Index relative to the Dow Jones World Index since late October. The fact that developing countries are now outperforming the developed ones is a sign that global investors are beginning to take more risk - a necessary ingredient for stock markets in general to improve further.

Source: StockCharts.com

Emerging-market equities have outperformed mature markets by 31.2% from the October lows. Further evidence comes from the tables below, showing the performance of the MSCI World Index and the MSCI Emerging Markets Index, together with a few individual emerging-country indices, over various measurement periods and in both local currency and dollar terms.

I would expect the outperformance

I attended a Richard Russell tribute dinner in San Diego on Saturday. This function, in honor of the 84-year old Russell’s 50 years as a newsletter writer, was attended by almost 500 people, including the likes of John Mauldin, Robert Precter, Ian McAvity, the Aden Sisters, Ivan Boesky, Bill Bonner, Bert Dohmen and a host of others.

There was a brief question and answer period. One visitor asked him what he would do if he was running the country. In classic Russell fashion, the venerable analyst answered, “I’d do nothing. I’d let it happen. I’d let the bear market do its work.”

For the rest, Aaron Task of Yahoo Finance, Tech Ticker pulled me aside for a short video interview and the paragraphs below are from his