Coupled - decoupled, which is it? What is it?

Recently so much talk has been made about whether the global economy is coupled, decoupled...re-coupling, decoupling, or who knows what. Do individual countries economies move alone or are they all intertwined in one big global economic cesspool?

For example, if I showed you a chart of two indexes, but didn't tell you what they were... you could tell me if they track each other just by looking at them.

Here we've got two indexes that over the last year seem to be following the same pattern. While they're not exact... they track each other pretty well. The two lines on the chart represent the S&P 500 index and the iShares MSCI EAFE index (a broad measure of 21 individual country indexes).

Are these coupled, do they move together? Well in simple investing terms, the answer is yes. The S&P 500 index over the last year is down 22% and the MSCI EAFE index is down about 26%. So are global markets coupled?

Well the answer isn't always as clear as the example seems...some are and some aren't.

Just because the broad U.S. markets have been heading south all year and the larger more familiar international countries' markets have also been on a year-long losing streak...don't think that every market is following lock-step.

There are opportunities out there in the global markets. Not everyone is facing the same crises as the United States. Some South American countries, the Middle East, parts of Africa and others offer intriguing opportunities.

DAVID NEWMAN, Market Analyst