Editor's Note: This article was originally published at 5 p.m. EDT on Real Money on July 22. Sign up for a free trial of Real Money.
The Organisation for Economic Co-operation and Development (OECD) this month published a 60-page economic policy paper titled "Policy Challenges for the Next 50 Years."
For traders, the subject matter is largely irrelevant and most probably confusing. For professional investors and advisers to them, along with accountants, attorneys and public officials, it is a must-read.
The paper's principal point is that the nominal and real economic growth rates that were the norm in the developed countries over the past 100 years and in the largest developing countries of the past 20 years have permanently decreased from the 3%-4% real level in aggregate to 2%-3%.
Please note that the developing countries are what the media have come to refer to as the BRICs -- Brazil, Russia, India and China -- but the group encompasses more properly the 10 developing countries that are members of the G-20. They are Argentina, Brazil, China, India, Indonesia, Mexico, Russia, Saudi Arabia, South Africa and Turkey.
This alone is a profoundly important issue for investors to be aware of now. The primary meme advanced by the financial media concerning the growth rates in both the developed and developing countries, including the U.S., is that the shift toward lower growth since the 2008 financial crisis is a temporary phenomenon and a residual effect of the legacy issues that still linger, especially on the balance sheets of the U.S.-based money centers, due to the enormity of that crisis. The prevailing opinion is that monetary and fiscal support will enable these economies and capital markets to return to the previous norm of higher growth within the next few years as the legacy issues are resolved.