After three-and-a-half years of ho-hum on this front, there is renewed interest in interest rates: where they are going, how fast, and what we need to do to be prepared, if change is indeed in the wind. A lot of the talk is related to another 'up' that scares us: inflation. Talk of rising interest rates is very good news, since it strongly suggests higher confidence in near-future growth.
How the mighty are falling. Resilience was a word used liberally to boast of the BRICS countries' staying power in the post-crisis period. Many even ascribed global-growth-engine status to these rising powerhouses. But 2013 has been a second tough year for the August group, even as OECD nations are steadily returning to growth.
Tired of the long, drawn-out debate on future economic growth? You're in good company. It's a necessary debate, because our individual livelihoods depend on it. But it's a frustrating one, because there's little agreement, and the arguments are oftimes circuitous -- even those made by the "experts." Is there a way out of the analytical quagmires that we are currently up to our axles in?
When I'm lecturing to students I like to ask them how much a $100 pair of shoes costs. The most common answer is $100 plus tax. Would you believe me if told you it could be as much as $1,376.46? As a 20-year-old, if you convinced yourself not to buy the shoes, and invested it instead -- with an assumed rate of return of 6 per cent -- you'd have $1,376.46 by the time you were 65 years old.