"Struggling here among the hustle and bustle of Bali while you relax in the tranquility of London but alas someone has to put up the good fight.

"While as you know I am a big believer and proponent of emerging markets, over the past week or two I have been shocked at how expensive on a PPP basis Singapore and Jakarta are. For awhile I was saying it was as expensive as NY - until corrected by one colleague who brought me down to earth a bit -- but in Singapore's case it is close and Jakarta is no bargain.

"To some extent I feel here like I felt in London when I attended the chart seminar and the pound was 2.07, or in summer 2008 in Mexico - wish I had shorted both currencies at that time.

"A big regret was not accepting payment for development of a site in rupiah instead of USD as if I had taken it I would have gotten 15-20% more.

"So in any case my thinking is if the turbulence continues given the relative overperformance of EM over past year, we may see relative underperformance in coming months -- and I also think that US corporations have far more fundamental competitiveness here by virtue of currency than a year ago.

"Anyway, hope all well with both of you."

David Fuller's view All is well and thanks for the insights. Eoin is looking forward applying Behavioural Technical Analysis in this lively market environment at TCS commencing tomorrow, particularly as most of the delegates are subscribers.

Rather than a matter of PPP, I suspect the higher costs you are experiencing in Singapore and Indonesia reflect, as you allude to in your penultimate paragraph, the weakness of the USD against the SGD and IDR. Permanent deficits are a recipe for weaker currencies.

The US is currently "the safe haven by default", but this is a movable feast, as you know. I regard it as a cyclical period of outperformance within a secular trend which favours the Asia/Pacific and resources exporters which demonstrate good governance.