In America, by contrast, the Federal Reserve is squeezing yields in an effort to revive a flagging economy, where unemployment remains too high and inflation too low: core consumer prices, excluding food and fuel, rose by only 0.6% in the year to October, the lowest rise on record.What is more surprising is foreign capital's new appeal to Indian officials.
There are few votes in reminding the electorate that it was foreign capital which kickstarted Hungary's moribund economy in the early 1990s, which has brought tens of thousands of jobs and which has nurtured Hungary's nascent middle class.
"There is a campaign going on, but the last thing they want to do is to be scaring foreign capital away," one Western diplomat said.
The problem for Spain is that foreign capital has been fleeing over the past year.
If a potential buyer wants to pay what might be considered "too much" for a particular asset, that is the good fortune of the seller and the net effect is extra foreign capital inflows into Australia.
But in other regions, like Africa, a large share of industrial capital is foreign-owned.
Among other things, Daimler-Benz's bold acquisition of Chrysler Motor reminds one of how open the U.S. is to foreign capital, even when that means selling off a proud American manufacturing name.
The main determinants of whether firms introduced a new process in the market were foreign or mixed capital origin, sector effect, and export orientation.
If the exercise is repeated, and especially if violence is attendant, the foreign capital that is vital to Georgia's economic development may conclude that countries which are less free but more stable are a better bet.
"This comes at a critical time for the Rajoy government, just as market sentiment towards Spain is improving and foreign capital is trickling back," Mr. Spiro added.
Even when the West emerges from its economic malaise, there is no reason to think that there will be enough foreign capital to mitigate the massive unemployment even in the poorer European regions, much less in Africa, Asia and Latin America.
