Welcome to Money for the rest of us. This is a personal finance show on money, how it works, how to invest it, and how to live without worrying about it.

I'm your host David Stein. Today is episode 474. It's titled,

Are Emerging Markets Bonds a once in a generation opportunity? A month or so ago,

one of our members of Money for the Rest of Us Plus sent me a strategy piece by

the asset manager, GMO. It was written by Victoria Cormay. She was on the

portfolio management team for GMO's

emerging markets debt funds. In the piece she wrote based on our reading of

valuations for emerging markets debt, we anticipate looking back at this current

period as a generationally attractive entry point for emerging market local debt.

Now in this episode we're going to take a look at emerging market's debt,

but there's a distinction that she made.

There's emerging market's local debt, which is denominated in the local currency of

the issuing country, and there is US dollar denominated emerging markets of debt that the interest and

principal needs to be paid in U.S. dollars and as an investor investing in

emerging markets U.S. dollar-denominated debt, you don't have the currency risk.

You're not hurt by the weakening of the Emerging Markets country's currency, nor do you benefit when emerging markets

currencies appreciate relative to the US dollar.

Cormac continues, the US dollar overvaluation is at relatively extreme levels, likely to provide a strong

ongoing tailwind for non-dollar assets in general.

We believe a emerging market local debt can be a powerful way to

capitalize on this as a supplement to both emerging markets equities and other

asset classes. In another piece she wrote that was published in the Financial

...