If you're just waking up, then you'll see that emerging markets are getting routed again.

Whether its Thai stocks, Brazilian bonds, or the South African Rand (its currency) investors are dumping it all.

This is a complex topic, and there are some idiosyncrasies that make each country different from another (of course), but there are 3 big themes.

The first one is the rise in US interest rates.




More importantly than the fact that they've turned positive is the fact that there's just been a big spike in US real rates.

Money flows to where interest rates are high or rising. When real rates in the US were collapsing, that pushed a wall of liquidity out into the emerging world looking for yield. Now that things are reversing, that wall of liquidity is coming back, being sucked out of the emerging world, causing all of the ructions we're seeing.

The next factor is the slowdown in China. Many emerging markets are in some way levered to exports to China.

The China slowdown is one of the big stories of the year (confirmed with weak data over the weekend) and so this continues apace.

And then finally, there's the commodity slowdown, which is related to the China slowdown.

A lot of emerging markets are commodity players.

As you can see, it's been a rough several months for commodity prices (as the generic chart of the CRB commodity index shows below) and this takes a toll on these economies.

There are many more stories in all of this, but these are the big themes to watch.