China prediction comes true. Here’s what’s next …

Last Wednesday, I sent you an afternoon flash predicting a big shocker out of China — the worst GDP growth since the 2008 debt crisis and Great Recession.

I felt it was so urgent, I could not wait until my regularly scheduled post to get it to you.

And sure enough, before the end of the week, the Chinese government made the announcement, and the headlines were everywhere:

“CHINA’S ECONOMY GROWS AT ITS SLOWEST PACE SINCE EARLY 2009” — Washington Post

“CHINA’S ECONOMIC GROWTH WEAKEST SINCE GLOBAL CRASH” — The Irish Times

"TALK IS CHEAP FOR CHINA’S ECONOMY — AND STOCKS” — Wall Street Journal

Why is this so important? For four reasons …

First, because China is the world’s second-largest economy.

Second, because China is the locomotive that helped pull emerging markets into prosperity all over the world.

Third, because so much capital has flowed into both China and the emerging markets in recent decades.

And fourth, because this megatrend is REVERSING, helping to drive global capital to the one country where the economy is still solid and financial markets are rising: The United States.

Result: The global money tsunami — massive flows of flight capital from the world’s hot spots to the world’s safest havens — is back in full force.

But China is not alone.

In recent days, the spotlight was on Saudi Arabia’s de-facto ruler, Crown Prince Mohammed bin Salman.

In the wake of the Jamal Khashoggi assassination, the Saudi stock market plunged, their currency crashed, and major institutional investors whom the Crown Prince was courting ran for the hills.

Treasury Secretary Steve Mnuchin, Jamie Dimon of JPMorgan, and the bosses of Ford Motor Co. and Uber are just four of the many government and business leaders who have canceled plans to attend the prince’s investment forum next week.

The full details of the assassination are still coming to light, but it’s clear that, for now at least, these Western leaders won’t touch Saudi Arabia with a ten-foot pole.

Consequence: Still more big money on the move! Investors dumping Saudi assets and shifting to the one place they can find relative safety and plenty of liquidity: The United States.

But here’s the key:

Foreign investors fleeing turmoil and searching for a safe haven are NOT looking to buy risky stocks. They don’t want unknown, fly-by-night companies with nothing but tall promises. They’re buying strictly cream-of-the-crop companies with big profit potential AND relative safety.

My advice: Stick with the best of the best.

Good luck and God bless!

Martin