Whats the writing on the interest rate wall?

Stumbled upon the world interest rate charts today: http://www.fxstreet.com/fundamental/interest-rates-table/

One of the things to be quickly noticed is the unmistakeable pattern. The interest rates (cheapest available cost of capital or the risk free rate of return - depending on which side of the transation you are in) of all the countries has consistently dropped over the last 12 months - and importantly, it is a steady linear decline, not a puckered crown or crest and trough zig-zag. The peak seems to have occured somewhere around the 3/4th mark of 2008 (roughly one full year after signals of the sub-prime trigger became public information) before which it was stadily rising. Of all the countries, Australia is the sole exception - showing an uptick in interest rates over the last 6 months.


Especially in times of recession, the countries which give the highest rates are also the countries which that have the highest potential for growth (Why? .. think over it). Here are some numbers: Brazil - 8.5%, Egypt - 8.25%, South Africa - 7% (Yes, Africa is catching up folks, you all saw Africa's show of power at the Copenhagen Summit so don't be complacent of their growth story), Turkey - 6.5%, Hungary - 6.25%. China - 5.31% and India - 4.75%. Iceland's also got a high interest rate (10%), but it is perhaps to counter-balance the bankruptcy risk - much the same way junk bonds have a higher coupon rates due to default risk.

What can we infer? The fact is: Interest rates have NOT started rising. The perception that we're out of recession could still be just a perception - much the same way that the perception of a 'recession' was itself caused only due to widespread loss of confidence and the ensuing decrease in demand. The confirmation that we have recovered from the recession will be given only when the interest rates start rising (and that, is cold hard evidence!). Oh wait! But the stock market has risen steadily during the same period, you might rightly argue. I guess the rising market is not due to fundamental strength, but due to the stimulus packages, financial struts and various other gimmicks and stunts which are propping up the scare crow. So you're thinking "Oh really?". Yeah .. Wait and watch.