'Percolating' Inflation Concerns in Emerging Markets: Hedge Fund Exec

After appearing on "The Strategy Session" on Thursday, Judah Kraushaar, managing partner of Roaring Brook Capital, a hedge fund focused on U.S. mid-cap companies, continued the discussion off-air with David Faber, about what could hold back emerging markets.

"An important risk is budding inflation, at least in parts of various product markets. And when you start with emerging markets and all the money that's being created by the Fed and other developed countries—central banks tend to be migrating to the emerging markets—you've got a flood of money that's sort of percolating into inflation," Kraushaar said.

"These are countries—whether it's Brazil, or Turkey, India, China—they've gone through boom, bust for 30 years and this is their time to shine. And to allow unbridled speculation to take over? Most policy makers, I think, have at least some sensitivity to that," he said.

For that reason, increasingly we are seeing interest rates rising and/or capital controls put in place to try to put the brakes on things, Kraushaar added.

"The problem is right now, things are very jammed up and you create inflation in commodities, because of excess demand, and also for goods that are manufactured in many of these markets, he said.

"That gets transmitted back to the U.S. market in terms of higher costs for companies that rely on imported goods or commmodities as ingredients in the products that they sell," he added.

"The risk for U.S. companies is going to be much more variability in profit margins over the next year and probably beyond," Kraushaar said.

Follow Strategy Session on Twitter: @CNBCStrategy

Watch CNBC's "The Strategy Session" weekdays at Noon ET