In the midst of the current widespread gloom and doom in the west, it is important not to lose sight of the true structural themes shaping our era. Linked to the current mood, commentators often depict an embattled and shrinking middle class, with sharply rising financial inequality. However, globally, this is simply not true. One of the most startlingly positive phenomena for many generations continues to unfold around the world. We are in the middle of an explosion of the world's middle class.This may be news to people who have not visited India or China recently. From my exposure to India, it is definitely true about the middle and upper middle class in India. The Indian middle class is 'punch drunk' in a wave of prosperity, tempered only slightly by a sluggish stock market this year.
The article goes on to talk about BRIC economies - a topic of great interest to many who investment in mutual funds and ETFs. However, the article points out that this is a phenomenon which s not restricted to BRIC countries.
This is a global phenomenon and is driven by globalization and the generation and redistribution of wealth it creates. (Yeah...yeah. We all know this. We've all read Friedman''s book 'The world is flat', right? In fact, I'd add that we knew all this even before he wrote the book. He just wrote the right book at the right time and got really famous doing it because in some ways, he said it out loud first and is hence (going to be) seen as a visionary; even if what he stated was obvious for anyone who was working and living in 1999-2003 and could have said all the same things if he thought a little bit about what was happening instead of just bemoaning 'outsourcing'.)
Anyways, do read the article. It contains some interesting data, for sure.
Updated: Quite a few more articles on the subject recently.
One in the NYT (July 18th): Boom Times Take Root in Dubai
Another in WSJ Blogs (August 5th): Clean Tech: One Sector Is Bucking Global Economic Blues
and one more in NYT (August 12th): Cost-Cutting in New York, but a Boom in India
P.S. In reading up some other articles related to the above, I found this interesting related study about the spending and saving habits of Indians. It found that..
The survey reveals that most Indians prefer keeping 65 percent of their savings in liquid assets like bank or post office deposits and cash at home, while investing 23 percent in physical investments like real estate and gold and only 12 percent in financial instruments.