Predictable . . . . and will occur in Iran as well.
Allan Greenspan referenced this in an oblique manner the other day, talking of the extraordinary period of global growth we are seeing right now with inflation in single digits, even in the developing world . . . . . with centrally planned economies like Zimbabwe, Iran and Venezuela obvious exceptions to these comments:
"This is the first time I remember when we could see a period in which we took all of the developed countries and the major emerging market countries, [except Russia and Turkey] where inflation is all single digit, and interest rates are all single digit," Mr. Greenspan told the audience by video conference from Washington.
But it won't last, he added.
"This is a global phenomenon, and it is quite extraordinary. And I suggest we enjoy it so long as it's going on. I doubt if it's anything permanent, unless human nature has changed."
The era of low rates was brought on by the fall of the Soviet Union, as millions of people shifted out of a centrally planned economy that had no impact on global markets. As Eastern European workers and businesses embraced the rest of the world, they exerted downward pressure on wages as they adjusted to an open economy, Mr. Greenspan said.
"It became very apparent that central planning meant economic ruin."
http://www.theglobeandmail.com/servl...uery=greenspan
Que Venezuela, Iran and Zimbabwe . . . .
Cowperson