When will emerging markets begin to rally?

"As much as I would like to buck the bearish sentiment, I continue to see EM as an underweight, in currencies, bonds and equities."

That's how I ended the last post.

Yet, at the same time, even as crisis deepens in the emerging markets, my eye is on the buy signal because of the relative value.
The strong dollar as precipitating force
Before I get into when to buy, let me go back to why we even have a crisis. And it's clearly policy divergence and the strong dollar. We first got a whiff of this in 2013 during the taper tantrum, when markets reacted violently to the unexpected announcement that the US would wind down its quantitative easing program.

At the time, Morgan Stanley coined the term “fragile five” to refer to five emerging markets that were the most vulnerable to outflows of fo...

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