Europe, For One, Welcomes Its New Asian Overlords

Tyler Durden's picture

The IMF's World Economic Outlook (WEO) provided a plethora of data, trends, and extrapolations for investors to prognosticate upon. One that caught our eye is the rising trend of the 27 Developing Asian economies as a share of World GDP.  Bloomberg's Chart of the Day notes that by the end of 2012, Developing Asia will account for 17.9% of World GDP - trumping, for the first time - Europe's 17-nation 16.9% share. The euro-area crisis has merely accelerated a trend that has been ongoing for several years - and we suspect, as former IMF board member Domenico Lombardi notes, makes it clear that euro-area economies need to address their structural reforms rapidly. America should not be too complacent however, as while China will top Europe by 2017 (as a share of global GDP), USA will welcome its own overlords in five short years when Developing Asia will have topped the USA for the first time ever.


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Yen Cross's picture

 China is waiting for Europe to cave in, so they can swoop in like "vultures," and pick up the "crown jewels", for a fraction of their value. Africa style.

disabledvet's picture

Not if the Americans get there first.

Yen Cross's picture

 The Americans are already there. The sick twisted, "symbiotic relationship" between the two, just skews it. Good point though, as it will just become more obvious, and increase in scale.

Mountainview's picture

The trend will only change if currencies are massively adjusted. First the Asian share would boost to flatten out thereafter.

falak pema's picture

well the US/anglo Oligarchs have shown them the way since two years; so there is good precedence in Club Med countries.

Global Hunter's picture

Yen you could be correct, but if they become embroiled in turmoil it will be Russia sitting back waiting to swoop in like vultures.

Yen Cross's picture

 The Russians already have a strangle hold on Europe via Nat.Gas and Oil. They just want the cash cow to keep flowing. Russia is rich in resources.

Svendblaaskaeg's picture

..but will they find zee gold?

disabledvet's picture

And of course "the Americans are fat, dumb and lazy for trying to go toe to toe with this reality going on 40 years now." I mean I'd like to think mercantilism is the answer...but one look at the EZ and I say...nein.

Tortuga's picture

"China will top Europe by 2017 (as a share of global GDP), USA will welcome its own overlords in five short years when Developing Asia will have topped the USA for the first time ever."

Never happen. China/Asia is corrupt to the core and has been for 3000 yrs. USA corruption is only the elites and maybe Califas, DC and original 13 colonies.

Those of us in the flyby country can/will clean up this corruption in a 3 day weekend and still have time for Monday nite football.

The 90's real estate bust is a perfect example of how the inscrutable oriental mind is able to "overlord" the USA. USA. USA.

DoChenRollingBearing's picture

+ 1  Tortuga raises great points, one is that just because the Eastern countries have a total GDP more than Europe, they are still way behind in GDP per capita.

Another great point is that they make mistakes too.  CHINA, for example, through history has shown that it screws up JUST at the point of becoming a superpower...  Every dynasty has done this, soon the Communsit dynasty will do the same?  Probably...

Global Hunter's picture

Agree Tortuga, I believe here in rural Canada we'll not only be OK but will thrive as well, provided we stay clear of unforeseen blowback.

LMAOLORI's picture



Global Hunter do you still have your right to bear arms? Just wondering I thought your laws were pretty restrictive but I know your new more conservative gov. was supposedly trying to ease the regulations. 

Thank goodness they haven't been able to disarm the USA yet.

Innocents Betrayed

john39's picture

China is corrupt to the core?  total bs....  having lived there on and off for years, its obvious to me that you have not.  Most Chinese are fine decent hardworking poeple, who get screwed by their government, just like in the U.S....   the American population is fatter and more unhealthy for sure, but Chinese are catching up as multinational food companies take over...   the problems tha the world faces are not people vs people... its the corrupt system, in place world wide that puts a small clique of elites in charge of everything through a corporate fascist network.

BlackVoid's picture


EU is 27 countries. But of course that would show up as larger share than US, so that is not allowed.

Lies and statistics.

falak pema's picture

well the west has to pay a price for its irrational exuberance. Sarko gave a conference on that theme to a bunch of brazilian of Oligarchs in NY.

The question is how will they eat humble pie. That is the big question. Go down in flames, take the world down in flames, drink yourself into oblivion, or work, work work to dig yourself out of the hole. 

Most probably the knee jerk for a few more years will be denial...

Global Hunter's picture

I'd like to give a conference to a bunch of Brazilians, but I'd only be interested if the attendees were females in mardi gras costumes....I assume that their oligarchs are as nasty as ours so I'd give them a wide berth.

Global Hunter's picture

China can bail them out, but they can't beat the trend that we're going to need to consume less of their crap.  As for Japan I suppose they could print up some more yen, bail them out and be left with a 300% debt to gdp ratio :)

resurger's picture

Id better be long Samsung! these guys have a motto "Korea Vs the world"

sessinpo's picture

Sounds a lot like the 1980s when many people in the USA feared Japan was going to take over.

Global Hunter's picture

yes except this time nobody is going to take over and that is what makes it all very interesting this time around

sessinpo's picture

And the last time, Japan didn't take over. So in other words, it's a bunch of hype. Nothing new under the sun. Makes even LESS interesting.

Global Hunter's picture

ahhh I see, but when Japan was in our minds as the next economic miracle/power, we still had the USA and the USSR as world powers, this time around, the USA is nearly where Japan and the USSR were then.  That's what I mean by interesting, who will come out on top, what if nobody comes out on top?

sessinpo's picture

Interesting thought Global.

For me, I think the thread is before its time and without enough data to support it either way. As back in the 1980s, the Asian countries are heavily export dependent, like Japan was.  Asia may crater just as well.

And unlike others, I still consider Russia a formidable adversary. Quite frankly, any nation with enough Nukes to blow up the entire world is a player.

Someone will always come out on top. Here I go into a political comment so plug your ears. Even in socialist/communist nations, there is still competition. It is simply changed from state controlled from what some would say, free market or capitalistic society. For instance, even if every nation in the world were communist, those individual communist nations would still be competing with another. That means there would still be military wars and economic wars.

Thanks for the reply. Good post.

10mm's picture

No fear with americans today.Fat,tv slobs,and no critical thinking muppets just slug along.

Peter Pan's picture

Asian overlords? You have to be kidding me. I asked my elderly next door neighbour one day why he didn't accompany his wife on her Asian holiday. His immediate reply with a dead pan look was "why the fuck would I visit a country I wouldn't want to live in?"

Asia on a per capita basis is so far behind, the world has too many resource constraints and Japan and China's aging demographic all dovetail perfectly to limit their continued ascendancy.

Totentänzerlied's picture

I live in a country I wouldn't want to visit.

Atomizer's picture



Take a wild ass guess on what taxpayer funds this program.. 

Grand theft auto in broad daylight. In order to fund expansion, they come to you for money. I.e. LTE, mobile cell towers, cable TV, and the list goes on …

Millennium Development Goals  -- Look how you’re going to fund new globalization manufacturing in Africa.


orangegeek's picture

Not a fan of what government has done over the last number of decades.


But I do know this.  Many have tried and failed.


Don't bet against the US. 

Clashfan's picture

Don't be a whistleblower against them either. But this new Prez was s'pozedta be a fan of 'em, right?

I'm stifling my laughter:

sampo's picture

And all this in a system where a major part of The financial world is nothing but merely a hologram.

BigInJapan's picture

... barring war ...

debtor of last resort's picture

Let Asia suffocate in their own consumer paradise. More more, just like we had over here, nine to five for an extra iPad. Let them get stuck in traffic jams every morning, taking their children to kindergarten. Loading up debt, work harder. The west will be forced to come up with something new, local economies and respect for eachother. Asia will follow in 50 years. It's a cycle.

cranky-old-geezer's picture



China's GDP comes mostly from production and export, our GDP comes mostly from internal services, trading financial paper, and government spending. The only thing we export is inflation.

They maintain their GDP with factories.  We maintain our GDP with a printing press.

Yep, my money would be on China in the years ahead.


kaiten's picture

Eurozone have a population of 300 milion, China 1,3 billion. Why is it a problem if the chinese economy becomes larger?. It´s the GDP per capita that matter. I wish them well.

onebir's picture

On the one hand, GDP (& other govt stats) are meaningless &/ goal-seeked. Let's not even get into the quality of economic forecasts...

On the other, they somehow define 'overlordship'.

Yet again, confusion sees Yoda the Tylers among.

Cosimo de Medici's picture

The Land of the Endless Economic Miracle, aka the "East", is only now recapturing the percent of total world GDP they had at the start of the 20th Century.  The major difference between 1900 and 2012 is that the East is now is a much larger percentage of total human population than it was in 1900.  The "developed" countries drastically reduced fertility, while the "developing" countries kept popping 'em out a dime a dozen, or a dollar a day.  The price these nations have paid for the so-called "miracle" is overcrowding and pollution.  On top of that, not only did they not avoid the Corruption Of and By the Elite that now hamstrings the West, but they leapfrogged anything the West might have done in terms of cronyism/corruption.  One might say winning is losing.

Reality, as it unfolds, has a way of putting all of these projections on the "steal me" table fare at Barnes and Noble.  Is the Japanese economy now larger than the US', as it was projected to be by the year 2000?

SWIFT 760's picture

China economy is propped up with tooth picks. The real winner is Iceland. 

MSM won't report on success of Iceland, global natives could get restless. 

o-antonio-maria's picture

You cannot count apples and carrots! This is the most stupid graphic I have seen lately. EU still has the highest GDP in the world, and it's not only debt like the US one...

Mountainview's picture

But here they speak about the EURO area...