Note to editors: This post is coauthored with authorized HuffPo blogger
Source: Gurkaynak, Sack, Wright (2006, with updates).

Financial markets are global, so it would be very strange if this decline in real interest rates were just a local U.S. phenomenon. That is, because capital can flow easily across borders–especially those of advanced economies–risk-free real interest rates tend to move together everywhere in the world. And, as a recent Bank of England working paper shows, they have. That study shows that world 10-year real interest rates have fallen by 450 basis points since 1990.

As read more >>>

Source : HuffingtonPost.Com