The world economy – it’s not as difficult as trying to convince supporters of Keynesian economic, graduated from the University “Ivy League”. Company Goldman Sachs argues that the modern world is divided into two opposing camps: the developing countries that are faced with the problem of inflation, and the developed countries, where there is a reduction in the rate of inflation or deflation. In some countries, inflation is close to a record high or record low.Here we see the spread of inflation through currency.
In fact it is not a problem of developing many of the peripheral countries. Called peripheral states that are not manufactured and are rather a source of resources. Industrialized countries consume resources, so that the rich resources of the state are extremely dependent on their economy and try to get one of them. This is explained by the fact that in industrialized countries historically high level of employment (for sources of resources is a big political issue), higher value-added production and economic stability (as opposed to the instability generated by the dependence on the economic cycle commodities).
Emerging markets dictate economic policy
But the last decade has been marked not only continuous financial crisis and economic bubbles.Developing readiness (peripheral) countries to take the currency to print continuously to finance economies, consuming more than they produce, giving nations seeking to join the ranks of industrialized countries to increase consumption.
Overproduction and insufficient aggregate demand
As a result, now in developed countries there is a decline in production, and peripheral – the current account deficit.
All this put the world on a destructive path in the so-called “globalization trap” that ends global crisis currency not backed by gold. This path is easy to see: it is enough to study the economic indicators, removing Keynesian glasses and armed with common sense.
All this hurt the financial markets, as both developed and developing countries are moving in almost a predetermined cycle, which is displayed in the following graph.