Once upon a time the developing world heavily depended on the United States of America, the European countries, the International Monetary Fund and the World Bank for loans and grants. The commercial dependence of these less developed nations on a few developed countries and international financial institutions established the financial influence that was easily transformed into commercial and political hegemony of a few developed nations and international institutions backed by them. The rise in oil and gas prices and export-oriented growth has turned the table against the industrialized countries with the emerging countries appearing as the new global financial leaders.
The apprehensions of US and its allies of losing global financial control has been reflected in the US treasury secretary’s address to a gathering of the World Economic Forum in January urging the investment wings of foreign countries to sign up a code of conduct and become more transparent. The strengthening of the sovereign wealth funds (SWF) and weakening of the western economies following USA’s faulty lending policy that has shaken the international financial giants from their solid foundation has changed the global financial equations. From being lenders, the western economies have been relegated to positions of borrowers. China is holding a large amount of US Treasury bonds and following a crumbling dollar is contemplating reduction of the US Treasury bonds and investing in European assets instead. World’s biggest SWF, the Abu Dhabi Investment Authority is currently holding $7.5 billion of Citigroup equities. Swiss bank UBS has received $11 billion from one of Singapore’s SWF while another Singapore fund has invested $5 billion into Morgan Stanley. China has invested $5 billion in Merrill Lynch.
To cajole emerging countries’ SWFs to present transparent lending policies exposed the double standard of these nations who follow the most opaque lending policies. Eclipsing economic power is a precursor of slackening of global political influence that might upset the global balance of power. The developed nations have at last been defeated in their own game. In earlier days, the developing nations were forced to follow terms dictated by the international lending institutions and their western sponsors that required developing countries to open doors to MNCs adversely affecting their domestic industries. However, presence of oil wells, rising crude prices and labour-intensive industrial growths have helped emerging nations to strengthen their economies and challenge the west.
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As the most powerful country starts experiencing crisis, lots of country is affected. As of this issue, even rich people can’t go stay away from this crisis. Even rich and popular person needs payday loans now and again in many cases. An example is Michael Jackson, the King of Pop, has just announced an auction in April of various personal items over five days at an auction house in Beverly Hills. Among the lots going on the block are the gates to his famous Never Land Ranch, and the white glove that he famously wore in the ”Billy Jean” video. A spokesperson says that it isn’t a forced sale, and Jackson is just cleaning house. Michael Jackson has had some high profile troubles, both legal and financial. The Never Land Ranch nearly slipped into foreclosure, and he recently settled a lawsuit out of court. The lawsuit was brought by a member of the Bahraini royal family, who claimed that Jackson owed him money for not delivering a book and album that he had allegedly agreed to deliver for living expenses and others that he had incurred whilst staying in Bahrain at the invitation of the royal family. Sources close to the King of Pop claim that he has lived beyond his means for years. However, the rest of us may not need to sell our things at auction if we have a sudden expense knock our budget out of proportion – we have other options, such as payday loans.
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