Two striking changes have taken place in the global financial landscape in recent years. First, reflecting a combination of low investment and-more recently-strong revenues from oil exports, emerging market and oil-exporting countries have become substantial net savers. As a consequence, capital is flowing from emerging markets to industrial countries (notably the United States), the opposite of what would be predicted by economic theory (see Chapter Ⅱ of the September 2005 World Economic Outlook). Second, since the bursting of the equity market bubble in the early 2000s, companies in many industrial countries have moved from their traditional position of borrowing funds to finance their capital expenditures to running financial surpluses that they are now lending to other sectors of the economy.
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