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The assessment of the article offers the different explanations relating to the subject of the increasingly low interests rates all over the globe. Policymakers Trevor Ariza Jersey , as well as finance analysts, offer their explanation about the factors they believe are causing the fall in the global interest rates. One of the individuals giving their explanation for the low-interest rates is Ben Bernanke Eric Gordon Rockets Jersey , chairman of the American Federal Reserve. Ben鈥檚 argument is that for the global bond markets to clear is if the interest rates fall. In his argument, he asserts that the increasing in the saving by the retirement population in countries as Japan and Germany along with the saving of the oil exporting countries is the additional explanation for the global glut.
According to the article Chris Paul Rockets Jersey , he ignores the importance that the monetary policies play in the management of interest rates in different countries. He asserts that the resultant outcome of the policy makers retaining the interest rates in artificial low level is going to result in soaring of the demand and the consequent jump in inflation. Thus according to him, in it is not possible to blame the central banks for the low long-term rates in so long as the rate of inflation is low as well as stable. There are various theories that support the Ben鈥檚 assertion including the rise in the premium rate on the assets that traditionally used to be safe along with the rise in the precautionary saving. Another theory argues that the low global interest rates are as a result of the growing significance that the developing economies are receiving and their consequent massive saving due to the volatility of their economies.
I disagree with the various stakeholders on the explanations they give in support of the increasingly low global interest rates. One of the criticisms I have of the article is the fact that they consider that the private citizens and not the central banks possess their finances and thus are responsible for the massive savings. The fact that governments do not possess similar motivations as the private citizens makes the theory unreliable. The explanation that the growing markets are responsible for the low global interest rates additionally is faulty because the rate of growth in these economies is faster than that of the developed markets. Through the assessment of the new classical theory models which suggest that the growing economies should be pushing the rates of interest up Hakeem Olajuwon Rockets Jersey , the assertion becomes unreliable as it does not support the premise. Additionally, the common position is that the integration of the developing economies has had the impact of flooding the labor market. The standards theory asserts that the global labor glut should contribute to an increase in the rate of return on capital James Harden Rockets Jersey , which should have the effect of pushing the interest rates up.
The failure by all the explanations in the article to address the subject of global credit constriction mainly the one affection the small and medium size businesses makes these the explanations additionally flawed. The tight regulation of the lending standards has resulted in the shutting out of the significant source of global investment demand and as resultantly placed a downward pressure on the interest rates. Thus, the common position is the fact that there should be a decline in the global interest rates.

Sherry Roberts is the author of this paper. A senior editor at Melda Research in affordable writing services if you need a similar paper you can place your order for a custom research paper from college paper writing service.

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