The inevitable decline of the United States is now firmly part of conventional wisdom. The profligate-spending Obama Administration -- consider that the $1.42 trillion U.S. budget deficit in 2009 is bigger than the entire economy of India -- and its efforts to transform the United States into a European-style socialist democracy marks the death knell of what was once a great country. The future belongs to China and the rest of Asia. "Old Europe" is a living museum that barely merits mention.

Yet, the future is likely to turn out very differently from the way we expect. After all, over 70% of predictions in John Naisbitt's classic book "Megatrends" were wrong. The "decline of the West" may sell newspapers both at home and abroad. But the tectonic shifts in the global economy were better described by Fareed Zakaria in his book "The Post American World" as the "rise of the rest." Economics is not a zero sum game. Selling new members of the global middle class GM cars, Coca Cola, and the latest iPhone offers U.S. companies their greatest profit opportunities in 50 years. Understanding the dynamic behind this historic global shift is the key to focusing on the best investment opportunities over the coming years -- no matter where they are on the globe.

The Rise of the Rest: Follow "Old Europe"?

The "rise of the rest" is a shift of historic proportions. Thirty percent of the world's population resides in emerging markets. China, India and Brazil have a combined population of more than 2.6 billion people, many of them young and increasingly affluent. Meanwhile, far smaller populations in Western Europe, Japan and the United States are aging. Twenty years ago, emerging markets were cheap producers of goods to sell to Americans. Today, they are potential customers for American products and services. The rise of the global middle class may be the savior of American manufacturing.

And this isn't just a pie in the sky prediction. China's car market today is bigger than that of the United States. GM, once the very icon of American manufacturing, produces more cars in China than in the United States. Imagine what happens when China becomes the world's biggest consumer of Coca Cola, iPhones and Microsoft software. China's consumption will unleash a boom for U.S. multinationals.

Jeffrey Immelt, GE's chairman, argues that this shift in the balance of consumption power calls for a new business model. The products of the future will be designed, built and marketed in local markets. Yes, GM's car sales in China are booming. But the vehicles are made there with a Chinese partner. Applied Materials Inc., the Silicon Valley equipment maker, makes its solar panels in Austin, Texas, and develops silicon equipment at its headquarters in Santa Clara, Calif. But Applied Materials is also opening a solar research and development center in western China. It's the size of 10 football fields and will employ 400 engineers.

But Jeff Immelt's characterization of a "new business model" must bring smiles to the faces of his counterparts in "Old Europe." Spoiled by one huge domestic market, many U.S. companies are behind the curve. (GE itself is an exception.) European multinationals like Nokia, whose market share of global cell phones stands at over 37%, are global from Day One. How can you not be when your home country of Finland has a population roughly that of Manhattan? Ditto for others like Swedish-Swiss infrastructure giant ABB, which expects to make more money in China than it ever could have imagined in tiny Switzerland. U.S. companies are catching on. S&P 500 firms already make 48% of their sales abroad. But a similar number for U.K. companies is 80%.

The Rise of the Rest: Change Is Hard, Not Changing Is Worse

Change is painful. The American economy has lost more than 2 million manufacturing jobs in the current recession. Many of these will never come back. Consider that in 2004, GE had 165,000 employees in the United States and 142,000 abroad. By the end of 2008, the ratio had been reversed: 152,000 in the United States and 171,000 abroad.

Loss of U.S. manufacturing jobs is a tough issue. Outsourcing, U.S. tax policies and a weaker dollar are all issues that raise political hackles. But consider the alternative. In the 1970s, the U.S. steel industry imploded and shifted overseas. In contrast, the automobile industry held on tooth and nail. The result? Pittsburgh hosted the recent G-20 summit to highlight to the world on how a city successfully adapts to change. The former U.S. Steel building in Pittsburgh now boasts a University of Pittsburgh Medical Center (UPMC) logo. In contrast, Detroit, the beneficiary of huge government bailouts, is a study in abject failure.

The Rise of the Rest: How You Can Profit

Emerging markets account for 30% of global GDP and are responsible for a higher percentage of global growth than the United States and Europe combined. Templeton's Mark Mobius has said China's stock market may surpass the United States as the world's largest by value in as little as three years. Yet, the average U.S. pension fund allocation to emerging markets is 5%. Meanwhile, U.S. markets have been flat over the past decade, even as emerging markets have tripled in value.

The portfolios of my clients at my investment firm reflect this new reality. Less than 15% of my clients' assets are in U.S. or U.S. dollar-denominated assets. And that's not because I have an axe to grind with the U.S. I simply see the best opportunities in global markets. And today, you, too, can invest in the world's top multinationals like Nokia (NOK) and ABB (ABB) -- or the world's fastest-growing markets like China (FXI), Brazil (EWZ) and India (INP) -- at the click of a mouse.

It's the single best way you can profit from the "rise of the rest."

Sign up now to receive The Global Guru e-Newsletter FREE! Email Address: Yes! Please send me Nicholas Vardy's FREE weekly newsletter, The Global Guru.