This post is a guest contribution by John Derrick, Director of Research at US Global Investors.

We believe global growth is the most powerful investment theme now and for the foreseeable future. You can see this playing out as countries like China, India and Brazil grow in economic stature. As we saw in Pittsburgh last week, the G-7 is being supplanted by the more inclusive G-20 when it comes to global economic decision-making.

Emerging market stocks were hit especially hard during the financial crisis but have been among the best performers during the rebound. We are currently in the midst of a synchronized global recovery, and with aggressive government stimulus, strong balance sheets and an ever-growing share of global GDP, emerging markets are likely to outperform the developed markets due to strong domestic consumption and forward-looking infrastructure investments.

The chart below from Goldman Sachs on consumer spending

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This commentary is from John Derrick, U.S. Global Investorsrsquo; director of research. If you believe now is a good time to invest in U.S. stocks, emerging markets may offer even more opportunity. We believe global growth is the most powerful investment theme now and for the foreseeable future. You can see this playing out as countries like China, India and Brazil grow in economic stature. As we saw in Pittsburgh last week, the G-7 is being supplanted by the more inclusive G-20 when it comes to global economic decision-making. Emerging market stocks were hit especially hard during the financial crisis but have been among the best performers during the rebound. We are currently in the midst of a synchronized global recovery, and with aggressive government stimulus, strong balance sheets and an ever-growing share of global GDP, emerging markets are likely to outperform the developed markets due to strong domestic consumption and forward-looking infrastructure ...

This commentary is from John Derrick, U.S. Global Investorsrsquo; director of research. If you believe now is a good time to invest in U.S. stocks, emerging markets may offer even more opportunity. We believe global growth is the most powerful investment theme now and for the foreseeable future. You can see this playing out as countries like China, India and Brazil grow in economic stature. As we saw in Pittsburgh last week, the G-7 is being supplanted by the more inclusive G-20 when it comes to global economic decision-making. Emerging market stocks were hit especially hard during the financial crisis but have been among the best performers during the rebound. We are currently in the midst of a synchronized global recovery, and with aggressive government stimulus, strong balance sheets and an ever-growing share of global GDP, emerging markets are likely to outperform the developed markets due to strong domestic consumption and forward-looking infrastructure ...

Regional holidays and commodity-related share weakness impacted Asian stock markets today with China's Shanghai Composite's down 1.5% following a 3.2% decline on Friday.  The Dow Jones Stoxx 600 Index of European shares also edged down for a second day, down 1.1%.  The MSCI Asia Pacific excluding Japan Index fell 0.6%, led by mining and financial companies.  The drop in U.S. futures indicated the S&P 500 may slide after two straight weekly gains.  Last week's gains sent the S&P500 up 2.5% and 18.3% year to date as oil prices have rallied 61.5%; gold prices have advanced 14.2%; the yield on the 10-year has gone from 3.34% to 3.47%.  Volatility, as measured by the CBOE Vix, has fallen  by 40%.  The US dollar strengthened against 14 of the 16 most-traded currencies

The week ahead will show to be a busy one.  Leaders from the Group of 20 nations meet in Pittsburgh this

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This morning, MarketWatch tells us there’s been “a broad-based decline” of shares in Europe. Apparently, “capital adequacy worries” over banks are the cause. We presume this is a polite way of saying banks have no money. 

At least the Europeans are owning up to the fact; in the U.S. investors are still pretending that the emperor’s new clothes are real. The pan-European Dow Jones Stoxx 600 index is down 1.2%, down the second day in four.

Shanghai stocks have also taken a bath. They’ve suffered their worst fall since November. This time, the worry is that the Chinese government will tighten its loosey-goosey monetary policy. According to MarketWatch, “The Shanghai Composite Index dropped 5.8% to 2,830.63, closing below the 3,000-point level for the first time since the end of June.”

Japanese shares are also down, despite recent data showing that the Japanese economy expanded during the second quarter. Japan’s Nikkei 225 Average fell

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In doing my normal Saturday reading, I came across a a href="http://online.barrons.com/article/SB124786932728760309.html"feature in Barrons/a about Swiss industrial/electrical giant ABB (a href="http://finance.yahoo.com/q?s=ABB"ABB/a). I've held shares in this company for about a year, and I continue to like this company, even though it has hit a rough patch (who hasn't?) Here's a couple of meaningful quotes from the Barron's feature:br /br /ulliABB's fortunes in the past year have been dented by exposure to the automobile and construction industries, but the Swiss engineering giant's power-transmission and distribution activities should continue to generate earnings that offset the weakness./liliProduct mix and geographic diversity so far have insulated span id="ataglance_stock_DWC_label" class="chartToolTip" onmouseover="com.dowjones.rolloverQuotes.show(this,'abb');" onmouseout="com.dowjones.rolloverQuotes.hidelater();" a class="verdana rolloverQuote" href="http://online.barrons.com/public/quotes/main.html?type=djnamp;symbol=abb"ABB/a/span (ticker: ABB) from the worst of the recession, and it looks well positioned to prosper. Its balance sheet is still one of the best in the industry, with $2 billion in net debt and nearly $5 billion ...

Here are five reasons I don't believe this rally has legs ... and why I find XLF's 10% run today rather incredible.

Well, Matt—if your research holds any water, today must have been a BOOM day for the (RAFI) fundamentalists out there. And this huge rally for XLF? I don't believe it for a second. In fact, the same dangerous impulses that led me to buy XLF at $15.07 (and see it promptly drop to below $6) are urging me to sell now that we're almost touching $12. After all, in that October binge of ETF buying (heavy on XLF and FXI—that would be the SPDRs Financials and the FTSE/Xinhua iShares for the less-ETF-focused among you), I'm actually AHEAD right now ... after a disastrous start.

In this environment, I'm looking forward to talking to Rob Arnott this Thursday at 1:00 p.m., where he'll be doing a webinar

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Concerned about the recent decline in stock prices, French President Nicolas Sarkozy, yesterday (Tuesday) called for the creation of European sovereign wealth funds. The funds would be virtual carbon copies of the state-owned investment vehicles that have sprung up from Beijing to Abu Dhabi to disperse their respective nations’ cash reserves in foreign assets.

Addressing the European Parliament, President Sarkozy implored his European contemporaries to embrace the current period of economic upheaval as an opportunity to restructure the global financial system. According to the Daily Telegraph, he also articulated the concern of many Western authorities that sovereign wealth funds, located primarily in Asia and the Middle East, could use their massive cash reserves to scoop up key foreign assets at extraordinarily low valuations.

“Stock markets are at historic lows. I do not want European citizens to wake up a few months from now and discover that European companies belong to

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