Bad News Hiding the Good.

INTERNATIONAL competition; ECONOMICS; ECONOMIC forecasting; ECONOMIC indicators; MARKETS; INTERNATIONAL trade

This is an article that focuses on the global economy. Investors and sailors both have to put up with patches of bad weather. Five years of liberalization had generated amazing growth that had led investment banker Goldman Sachs to predict that India was on track to eventually overtake China as Asia's biggest economic success story. Stocks with "China" in their name and shares of steel-and metal-producing companies worldwide have slumped as investors tried to decide whether China would merely slow down, or would crash, as it had in 1994. Stock prices fell sharply, because Prime Minister Junichiro Koizumi's government, the closest thing to a reform administration Japan has seen since the Second World War, faces an election in July and voters are infuriated that cabinet ministers, including Koizumi, had not made their pension contributions. That nearly 300,000 new jobs were created was obviously bad news for bondholders, who prosper when the economy is weak, inflation is low and the Fed is keeping interest rates down to promote economic recovery.