Innovation - is a historically irrevocable change in the method of production of things.
J. Schumpeter

M.I. Tugan-Baranovsky

J.A. Schumpeter

N.D. Kondratiev

Gallery of prominent scientists


Обращаем внимание на инновацию, созданную на данном сайте. Внизу главной страницы расположены графики,  которые в on line демонстрируют изменения цен на мировых рынках золота  и нефти, а также экономический календарь публикации в Интернете важных мировых экономических индексов 


IEE Forecast. In economic there can be a slow economic growth with the crisis periods

The deficiency growth of the account of current operations in the USA is connected first of all with smooth and deep downturn of a discount rate. The reason for it, as we consider, is FRS struggle against recession of economy in the USA, which has started in 2000 and proceeded till 2003.Embodied in decrease in rates of economic growth of about 2 % a year in spite of the fact that decrease did not cross a zero mark, recession has provoked corrupt processes in economy as a whole. The rates of return have appeared, first of all, in decrease in corporate sector. Growth of bankruptcies and financial scandals during this period proves that these uneasy processes are present.In these conditions, the USA accept the correct decision on smooth decrease for a discount rate that speaks about certain strategic direction in the policy of protection for national economic interests.At least two arguments speak in favor of such conclusion. First, the growth of the monetary offer should cause decrease in the real prices for money automatically. That would make active consumption of three basic institutional sectors in economy - households, that of firms and external. Second, however low the discount rate decreased, FRS, the Ministry of Labor and the Ministry of Finance neither in rates, nor in depth of decrease did not allow negative consequences in growth of inflation and unemployment above critical marks 5-6 %.The main result of such policy was not only growth of effective demand, but also " expression of surpluses " of the goods and services abroad. The USA made it by powerful economic "machine", and in economic categories it means growth of current operations. The speech at the G7 summit concerned it. In these conditions those countries which currencies have been adhered to dollar, left in safe position (i.e. China and Japan). Ukraine also belongs to them. And on the contrary, the countries at which there were no such binding, have lost. These are the EU countries. All weight of the goods and services, not only American but also the countries with currencies adhered to dollar, has pulled hard on them. It is easy to predict, that growth of the goods and services offer inevitably should cause reduction of prices, profitability, and as the result, growth of unemployment in EU.The European central bank has simply passed both, the moment and the situation when it was necessary to lower the discount rate in the answer or even actively come on the currency markets. In the world almost for the first time there was a situation when the discount rate needed to be used not as a result of changes of an intraeconomic situation, and for neutralization of increasing external risks. As a result, when there has come enlightenment, to lower a discount rate was already late, as unemployment in a number of the EU countries has exceeded a critical mark 6 %. Therefore they have been deprived of an opportunity to maneuver in the control of inflation over unemployment. Deficiencies of state budgets of the key countries have exceeded 8 % (reference: it is considered, that if deficiency of the state budget does not exceed 2 % of gross national product, it does not render negative influence on economy; the EU countries have agreed about 3 % of deficiency, "having put in pawn" for costs of integration processes) Germany has an interesting position, as it has declared the bottom border of a discount rate, at a level of 2 %. 2005 will show whether they were right.There was a moment when England has decreased a discount rate. However, growth of credits has stopped them and they have raised it again. Nevertheless it seems, that Europeans were not ready to meet a new situation with increase of euro rate. It seems, that they did not have a ready strategy on this account and they have absolutely lost this game to Americans. It is impossible to tell so about China. Now, Americans, having reached the purpose and having relieved economy from surplus of goods of traditional manufacture, have begun reverse move and increase the discount rate. Here, apparently, they again adhere to the verified strategy. Increase should be not so fast in order not to render negative influence for rates of economic growth (on the role in this process of OPEC policy IEE spoke in previous forecast). It should also be not so slow in order  not to be late with pressure upon deficiency reduction of the current account. By the way, it also corresponds to periodic official applications.It is possible to be late with this "reverse move" of a discount rate. This already signals reaction of such authorities of the market as Soros and Gates. The government sector does not hide expectations of decrease in a market rate of exchange too. But Americans have won the first game of this interesting struggle. And, no doubt, it is a merit of their strategy. And there is a doubt whether they will win the second game. And it is not even the matter if they can outstrip their nearest competitors by monetary maneuvers. They have already done. The matter is how they used the won in the first round advantage. Finally, only scientific and technical progress, and innovation have crucial importance in leadership. It is possible and is necessary to use existing economic capacities by expansion the world consumption. It may be expanded through reduction of non-uniformity of incomes distribution in the world, strengthening of processes of globalization, etc. However, the further expansion on the basis of traditional economy already obviously approaches to the natural limit, which is dictated by a growing pressure in the sphere of corresponding traditional resources.Therefore, if only the USA could not embody the advantage in a system innovation, the world in the nearest fifth anniversary expects slow economic growth with painful periods and with gradual displacement of accents in favor of the Asian civilization. And, on the contrary, if it took place, the world will change qualitatively and quickly. Here only growth of a discount rate in the USA in new conditions will already cause an attraction of traditional capitals from other regions. We will analyze in our following reviews how it can affect their innovative processes and the world dynamics.



Posted on the website: 2005-02-07

Comments on this article:

Прогноз ИЭЭ #6 (69). Мировая экономика получит импульс экономической активности в начале 2009
 среду 08.10.08 семь центробанков мира одновременно понизили учетные ставки на 0,5%
The forecast of the IEE #3 (59). Economic dynamics in Ukraine for 2007
In 2007 on the forecast for Ukraine following risks will be imposed
The forecast of the IEE #2 (58). Currency tendencies for 2007

Summing up 2006 it is already possible to speak, that for US dollar it was one of the best periods. We shall recollect even the end 2004 beginning of 2005 when its rate has sharply gone downwards in relation to practically all leading world currencies

The forecast of the IEE #8 (47).

In political relations between Yushchenko and Timoshenko eccentric events must happen to May 2006 (the Forecast on Hlebnikov Part 3)

Forecast IEE #7 (46). Europe: simultaneous growth of risks and sociopolitical pressure
The increase in the discount rate by the European central bank (ЕCB) in 2006 will cause a growth in the risks in the economies of incorporated Europe
The forecast of IEE #6 (45). Exchange risks of the world in 2006
afraid, that in the second half of 2006 the dollar exchange rate in the world exchange markets can fall to 30 % - 45 % in relation to ...
IEE Forecast [16]. Ukraine will not avoid crisis, if not to take precautions and not to start innovative processes
After year 2006, the economy of Ukraine will step in a phase of its first serious economic crisis
IEE Forecast (15). American economy will absorb the world capitals like a powerful pump in 2005
Even today we may predict the result of a FRS experiment on driving of the American economy from " a soft patch " at the beginning of 2000
IEE Forecast. If there are no innovative priorities, the habitation market will become a risky point of the fund for business and investors.

The real estate sector is a small drop, and but for economy it reflects the bitter history of Ukraine, and (without exaggeration) all the CIS history.

IEE Forecast (13). Investments outside of systemic innovations go "nowhere": on the lot of oil and dollar
World prices for oil and dollar exchange rate will be "the valve of constant pressure " for economic growth
IEE forecast and comment (II). If the discount rate will raise, dollar will strengthen
Though practically nobody doubts a possible FRS decision to raise a discount rate by 0,25 %, the world of analysts of the currency market has stopped waiting
IEE forecast and comments. On a sudden problem of " canceling of the obligatory sale of 50 % currency proceeds"
Political risks in management of economy do not weaken in Ukraine. That can provoke an economic crisis even in a short-term prospect (after 2006)
IEE Forecast. Dollar, oil, steel, and the global innovational system will influence the world dynamics
Factors, which will influence economic dynamics in the nearest future
IEE Forecast. Ukrainian economy is most likely to remain excessively dependant on tools of economic policy in 2005
Most likely, innovative processes, capable to bring Ukraine forward at any commodity or technological sphere will not start in
IEE Forecast. The World Economics Will Run a Fever For Some More Time
According to leading economist's opinion, continuous decrease of long-term rates in the world's most developed countries is one of the greatest puzzles in the financial world today. The problem is important for the USA, and other national economics
IEE Forecast. The World Economics Will Run a Fever For Some More Time
The world economics will run a fever for some period (5-10 years). It will suffer decreased production effectiveness, raised consumption of oil in China, price fluctuations for fuel. After that, we will experience an unprecedented and grand innovational project. The project will change the quality of all the world economics, absorb all the free capital, and increase long-term yield.
IEE Forecast: Growth of a dollar exchange rate can cause growth of the external economic risks for Ukraine
As to the internal factors, which compensate specified risks, it is necessary to carry significant potential of economic growth to them due to activization of internal consumption. It is a question of activization of the factors removing restrictions on ways of incomes growth of people, of fine and average business.
IEE Forecast. In economic there can be a slow economic growth with the crisis periods
The deficiency growth of the account of current operations in the USA is connected first of all with smooth and deep downturn of a discount rate.
IEE Forecast: on a dollar exchange rate, OPEC conference, and session of FRS board, Bush's speech and meeting of G7.
Events of this week will leave the trace in 2005 World discussions
IEE Forecast
The committee for Federal Reserve System (FRS) in the USA (FOMC) will raise a discount rate for 0,25 % having brought it up to the value of 2,50 % at the next session, which will take place on February 1-2, 2005.
IEE. In the coming year the price for gold will continue to grow
Gold already would seem ceased to carry out function of money, again in the price because of the monetary markets dynamics.