Is investing abroad because the U.S. is going through a rough patch a good idea? If so, why? What foreign markets are attractive? Investing abroad is a good idea -- but not because the U.S. is melting down. Instead, it turns out that emerging markets are outperforming developing ones because they are supplying the commodities that fuel demand for 10% annual growth in emerging markets like China and India.

Emerging markets are up 20% in the last year while developed markets like the U.S. are flat. The reason to invest in these markets is not so much because the U.S. is going through a rough patch but more because these other markets are doing so much better and they are going to continue to do well regardless of what happens in the U.S.

But the U.S.'s rough patch may not be as bad as people had thought. An economist at Wachovia Corp. (NYSE: WB) changed his estimate of the chances of a recession from 90% to 45%. So the U.S. may turn out to be a good place to invest if stocks are priced for a recession that doesn't happen.

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Should you invest abroad? originally appeared on BloggingStocks on Thu, 15 May 2008 15:36:00 EST. Please see our terms for use of feeds.