Today my blog has been read by people from about 60 locations.
When I checked through the Locations list, I chose the above three because I have not heard of them so much. So, Welcome Friends!
One of my most popular blogs recently was entitled "Do high input costs lead to inflation?". Yes, that is a rhetorical question, as of course input costs add to the sum total of inflation, and high input costs lead to increasing inflation.
In the major economies, they have realised that the interest rates have to be kept low, to rekindle growth. Even then, it is taking time....from October 2008 to now, is nearly three-and-a-half years, and the economies are not back to the strength they were previously.
I note that Oil after hitting $147 a barrel, then sank to nearly $35 in December 2009, and then it was a slow up and down to current levels.
In the meantime, lots of jobs have gone, lots of shopping centres look half-deserted. The unemployment levels are becoming a real concern, and costing the Western economies a lot of their budgets to pay social welfare. (In the developing countries, the social welfare systems are not at the nth level, with minimal and basic provision, meaning jobless people end up scavanging for food, sleeping rough even in the cold, as observed in some places in Asia few months ago, and, turning to crime or falling dead.)
My earnest plea with the developing countries is that they too cut their interest rates further. Then the overseas money will probably go into the local stockmarkets and thus into local and national businesses that will further support the local economy. Money will not flee the country; investment will feel more secure, and be invested for better returns. It is not a paradox, nor a conundrum. It is some kind of super-logic of the macro economic forces. My study suggests and lower Oil price and lower Interest Rates will benefit the vast majority of people, leading to a continuation of the worldwide economic Recovery, for which I earnestly pray.