He says that in the long term he's bullish about these economies, but in the short term he's concerned about a number of factors. Though he likes Brazil, Indonesia, Turkey and Peru, he says that the spreads for dollar denominated debt in those countries are too low, some only 100 to 150 basis points over Treasurys.
There "has been the flood of cash flowing into emerging market funds," he says. "Global bond funds that don't have our flexibility can't avoid emerging market debt when it appears overpriced. This has created a situation where valuations have been bid up to levels and spreads have been compressed to levels where there is really no room for error."