Global Finance Struggles

http://www.nytimes.com/2013/10/14/business/international/global-finance-leaders-look-at-a-shift-in-rates-of-growth.html?_r=0

 

This article basically talks about meetings where many committees and organizations have come together to discuss on the future of the world’s finance. In other words, with the upper class continuing to grow and middle classes continuing to slow down, there is a need for a future plan to rebalance. In many poor countries maintaining a balance between classes still remains a major problem and struggle. In fact, Fund officials discussed and looked into this mater in depth, concluding that emerging countries need to focus more upon the increase in demand and strengthening government finances. Economically well countries also believe that since they are doing well, they should have more representation towards the help to rebalance the world. Although many expected the world to flourish through economic boom in the middle economies over the recent years, this had not been the case. In fact there have been a decline in the middle class finances.  However, others warned and argued that rich countries are gaining power by cheap money which is also at the same time firing back at them. Anton Siluanov, Russia’s finance minister says “This growth is taking place against the backdrop of unprecedented monetary stimulation. In effect, we are witnessing a return to the old model of growth based on low interest rates and rapid credit expansion, which led to the global financial crisis in the first place.” In other words, relying on cheap money for a substantial growth and balance in economy will only make matters worse.