Global inflation exposed "globalization" of the bottleneck

Globalization in the past few decades, the world economy has been a huge bonus. In our minds have such a picture of the world economy: globalization has made countries around the world overcome the economic development of the domestic market and the lack of resources, and resources on a global scale the optimal configuration. But with the deepening of globalization, the bottleneck is gradually exposed. A large number of low-cost labor supply from the dividends of globalization are entering the end phase.

Morgan Stanley in June introduced the report shows that in 190 countries surveyed, 50 are experiencing high double-digit inflation, high inflation of the complexity of this situation is likely to mean the end of the golden age of globalization. Globalization is the first global inflation conduction become possible. Excess liquidity of the global economy, depreciation of the dollar and the international floating capital speculation, it is global inflation triggered this round of the root causes.

Now globalization is increasingly Let us feel the power of this a double-edged sword, the re-start the rise of trade protectionism, as represented by the WTO's global multilateral cooperation in trouble this globalization is also a reflection of difficulties. Long-term concern for world economic expert Jiang Yong even worried that the global economic situation has evolved on this, the tide of globalization does not rule out the possibility of being reversed.

June 23, 2008, Singapore's one Shuiguo Tan, fruit prices rising. Singapore has faced as much as 7.5 percent inflation.

The past: ignoring the "globalization" the negative impact of

Over the last few decades, globalization often means significantly lower commodity prices, regardless of the automobile, electronics, luxury goods, or banking services or communications costs. Along with personnel, capital and goods within the scope of the global flows, developed countries will profit, but also stimulate a broader market.

In fact, in 2003 to 2007, and the total world GDP growth of 5 percent per year, while inflation rate has remained at below 4 percent, more than any time in the past good. Historically, the early 21st century life with its more liberal trade and cheaper labor prices, more convenient means of communication, and more abundant capital created a beautiful and prosperous picture.

Such a beautiful picture for people to ignore the negative effects of globalization. Until recently, consumers, policy makers, even financiers, seems to have been overlooked this point. With globalization brought about by the unprecedented growth in the global context of labor, food and energy needs greatly enhanced. Now, in the wave of globalization began 35 years later, almost simultaneously throughout the world facing a severe test of inflation. The continuous development of global trade and the world capital market continues to expand, causing global economic prosperity, but it is the negative impact of the rapid worldwide expansion.

Everybody seems to feel that - because of inflation in recent months has Xirao the majority of countries - When people in the face of high gas stations and oil prices look sigh of Health, in a restaurant in front of the new-for - Menu racking their brains, or at home in front of Xuepian coming as the bill quietly curse when the wolf really came. On the vast number of developing countries in the world, hyperinflation means hunger, violence and political chaos. The complex situation of high inflation in the 30 before the Western world have arisen that could lead to the complete collapse of golden age of globalization.

Policy-makers have issued a warning. Just two weeks ago, the European Central Bank Jean-Claude Trichet, the President announced that the deteriorating inflation has affected Europe's economic growth, he warned that the inflation spiral to the second round effects have been felt.

Faced with this situation, Federal Reserve Chairman Ben Bernanke to Congress the report pointed out that reducing inflation to an acceptable level of the current work is the top priority. Asian Development Bank in July's report urged policy-makers should no longer like the past few decades as concerned about growth, but should focus on controlling inflation and prevent the emergence of a worst case scenario - economic stagnation.

November 2007, Lithuania in the streets against the grain price rise.

Now: 50 countries of double-digit inflation

Morgan Stanley in June introduced the report showed that "in the 190 countries surveyed have been as high as 50 are experiencing double-digit inflation", including the vast majority of emerging markets. Statistics show that half of the current global population is experiencing high double-digit inflation.

Today's inflation almost entirely concentrated in the areas of daily necessities, this is the 1970s and the inflation of a fundamental difference. The past, for instance, in the United States, food and oil price inflation accounted for only about 30 percent of the total. Core inflation products - such products do not include food and oil - showing a spiral-shaped structure. Clearly, now the core product prices are relatively stable (at least in the richer countries so).