NEW WORLD ORDER - THE TRIANGLE TRADE

In the last decade we have witnessed a major transformation in the global arena. World trade grows, but the U.S. is no longer the central factor. Since the early 1990s, world trade has risen from 19% of world GDP to 31% in 2007. Yet the U.S, which accounted for 98% of the cumulative increase in world GDP from 1995 to 2002, contributed only 21% to growth in 2007. New international players have emerged in military, political, and economic might. These changes create risks for certain investments, yet also generate good opportunities.

With a budding middle class and populations making up 36% of the world’s total, China and India have emerged as major players. Wall Street has been salivating over ways to put the average investor directly into these countries. What Wall Street fails to recognize is that direct investment in these countries can be a very risky venture.

Just as all roads led to Rome, all trade routes will lead to India and China. Shrewd investors can capitalize on the fact that Canada, Australia and Brazil are among those poised to capture the economic benefits of the new economy and the new trade routes. We do not recommend abandoning the U.S. market. We do, however, see a clear shift in the global economic dynamic. The New England economy started out by making money through financing trade across the world. We believe this investment opportunity still exists today.