...Research Assignment: “Asia’s performance during the global financial crisis has highlighted its flexibility. This flexibility, in part, arises from transformations undertaken in response to the Asian financial crisis a decade earlier.” Student Name: Eric Rodrigues Student Name: Mehmet Edib Unal Introduction The Asian Financial Crisis occurred during the year 1997-1998, and is explained well in brief by Galina Hale “East Asian countries experienced severe banking crises. Nonperforming loan ratios skyrocketed because of prior excessive risk taking and most banks had to be recapitalized by their governments.” (Hale 2011, p.3) After ten years, The Asian Financial Crisis was followed by The Global Financial Crisis in 2008. “The precise genesis of the global crisis remains subject to debate. (Lin 2012, Treichel 2012, p.3) “We will argue that global imbalances were the result of the large excess demand in the U.S. over an extended period—the financing of which was made possible by the reserve currency status of the US dollar. “This excess demand resulted from both the public debt” and “the overconsumption by households.” (Lin 2012, Treichel 2012, p.3) “As shock waves of the global financial crisis (GFC) reached East Asia in autumn 2008 immediately after the collapse of Lehman Brothers in September, the region faced the task of evaluating and reassessing the economic cooperation efforts of the previous ten years” (Katada 2011, p.274) Thus by evaluating and reassessing...
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...integrated global reality, more ruled by international corporations and organizations, and economic and ecological interdependencies, than national and political ideologies and issues. Fueled by global communication, technological networking, expanding transportation systems, economic exchange and competition, and the growth and spread of a global culture, globalization is seen both as a positive and as a negative trend. What are the main features of globalization, what are the future possibilities, and how will globalization have an effect upon your individual life? Outline “Nothing will be done anymore without the whole world meddling in it.” Paul Valéry The History of Globalization Positive Images of Globalization Imbalance, Diversity, and Conflict: The Problems of Globalization Global Tensions, Challenges, and Evolution for the Future Howard Bloom – The Deep History of Globalization – Reciprocity and Conquest Global Communication and Networking of Life Global Expansion of Humanity Emergence of Cities and Trade Routes Reciprocity and Conquest Robert Wright The Evolution of Win-Win Reciprocities in Human History The Expansion of Economic Interdependencies and Exchange The Expansion of Communication Networks Cumulative Evolution of Civilizations John Naisbitt Globalization and Individualism Increasing International Trade and Commerce Free Enterprise International Corporations Overturning National Economies Global Marketplace...
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...China's Xiaomi. It uses a similar supply chain, but slightly fewer parts are imported: the growing sophistication of Chinese manufacturers means that more components are being made at home. The rapid spread and subsequent slight retreat of such far-flung supply chains provides one possible explanation to a puzzle that is troubling policymakers: why international trade has been growing no faster than global GDP in the past few years. The notion of "peak trade" is being taken increasingly seriously. The composition of global demand could yet move back towards greater trade intensity, for several reasons. Whether trade is declining relative to GDP and why may not be clear for years. Yet one thing is: were more barriers to be lifted, especially in areas like services and farming where many still remain, it would probably lead to a new spurt in the evolution of supply chains that would lift trade far above today's "peak". Fears are growing that trade's share of the world's GDP has peaked. But that is far from certain WHEN Apple launched the iPhone in 2007, it deployed a state-of-the-art global supply chain. Although the pioneering smartphone was designed in America, and sold first to consumers there, it arrived in stores from Shenzhen, China. It had been assembled there by Foxconn International from parts made by two firms in Singapore, six in Taiwan and two in America. Since then, competition in smartphones has intensified thanks to lower-cost rivals such as China's Xiaomi. It uses...
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...Country Planning Moratuwa University Introduction to Political Economy Semester 3 Level 200 Handout 2: Theories of underdevelopment Background to -Marxist theories of underdevelopment 1) Countries are not independent; economically related through trade 2) Colonialism introduced capitalist system; 3) Therefore, all the less developed countries are integrated into the world capitalist system. 4) Developed world is responsible for the underdevelopment of third world 5) It is the integration with the world capitalist economy that makes these countries poor. 6) Marxist theory can help us to understand this process of underdevelopment Here, three theories are introduced under theories of underdevelopment. Dependency theory (Gunder Frank) 1966 The most interesting aspect of this theory is that it is a view from the periphery. Major argument of dependency theory Underdevelopment is a historical process; not a condition intrinsic to LDCs The dominant and the dependent countries form into a world capitalist system. Underdevelopment is caused by the functioning of this world capitalist system Development somewhere requires underdevelopment somewhere else (deve. and under development is two sides of the same coin “Development of underdevelopment” thesis. Condition of LDCs is not an issue of lacking internal dynamics (inertia, climate, misfortune etc,) but it is a reflection of the way they are incorporated into the world capitalist system Prepared by Dr. Nalani Hennayake, Department...
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...September 23rd, 2013 Last month newspapers’ headlines were talking about a statement made by Ollanta Humala to the media: “The crisis has arrived, but we have a solid economy”; indeed there is a global crisis going on and indeed the Peruvian economy growth’s expectation is not the very same as in just a few months ago; but, is Peru about to enter in another crisis as the ones suffered in past years? Disregarding the several replies, opinions and views of the message that our president really intended to give, let us remember Peru’s past crisis and understand the economic frame in which these crisis developed. A little bit of Peruvian’s Recent Crisis History1 In the early 80’s, during Fernando Belaúnde’s government, “El Niño” phenomenon affected severely the northern coast of Peru, impacting mainly in the agricultural sector (consumption), the public and private investment suffered an important contraction, also the external demand was affected due to the crisis generated by the adjustments of the debt in México (having a deep effect in all economies in Latin America). In year 1983, the metal prices fall meant for Peru difficulties for the payment of the external debt and a high increase in inflation, reaching a concerning 163% inflation for the last year of the “Sol” (1985). Also, in this year the economy suffered a contraction in the GdP growth: a decrease of 9.3%, the largest one until that moment in the Central Bank records. After this critical period, a new president...
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...Table of Contents INTRODUCTION 2 So what is financial intermediation? 2 a) The brokerage function: 2 b) The asset transformation function 2 c) The Risk evaluation and management function 3 Why are financial intermediaries important? 3 THEORIES OF FINCANCIAL INTERMEDIATION 3 Informational Asymmetries 3 Transaction Costs Theory 4 Regulation 4 HISTORICAL DEVELOPMENT 5 Origin of Financial Intermediation 5 EVOLUTION OF FINANCIAL INTERMEDIATION 6 THE FUTURE OF FINANCIAL INTERMEDIATION 7 TRENDS IN FUTURE FINANCIAL INTERMEDIATION 8 Regulation (Deregulation) 8 Revised regulatory framework 8 Revised reporting standards and accounting 8 International Monitoring and Oversight 9 Effects on Insurance 9 Technology 9 New financial innovations 9 Globalization 9 Presence 9 Scale 10 Increased Government involvement 10 IMPLICATIONS 11 CONCLUSION 11 BIBLIOGRAPHY 12 FINANCIAL INTERMEDIATION INTRODUCTION Financial Intermediation is a crucial and pervasive feature of all world economies. But as Franklin Allen (2001) observed in his AFA presidential Address, there is a widespread view that financial intermediaries can be ignored because they have no real effect. But this cannot be true, in my opinion, savings-investment process, corporate finance decisions, and consumer portfolio choices cannot be understood without studying financial intermediation. So what is financial intermediation? When talking about financial markets we generally...
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...abroad has been to a) Lower costs b) Respond more quickly to the marketplace c) Avoid trade barriers d) Gain tax benefits Ans: b Section: Evolution of Multinational Level: Easy 1.2 The primary objective of the multinational corporation is to a) Maximize shareholder wealth b) Maximize world production c) Minimize debt d) Minimize the cost of doing business globally Ans: a Section: Multinational Financial Management: Theory and Practice Level: Easy 1.3 ____________ is defined as the purchase of assets or commodities on one market for immediate resale on another in order to profit form a price discrepancy. a) Internationalization b) Arbitrage c) Financing d) Total risk Ans: b Section: Evolution of Multinational Level: Easy 1.4 The value of good financial management is ___________ in the global markets because of the much greater probability of market imperfections and multiple tax rates. a) Minimized b) Neutralized c) Enhanced d) Arbitraged away Ans: c Section: Role of the financial executive Level: Easy 1.5 When a firm operates globally it offers advantages such as a) Greater political power at home b) Bless taxes on its profits c) Greater negotiating power with foreign minority groups d) Greater negotiating power with labor unions Ans: d Section: Rise of the MNC Level: Easy 1.6 The prime transmitter of global competitive forces is the a) Public utility firm b) Financial management experience of the U.S. markets c) The multinational corporation d)...
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...after the financial crisis the United States financial system has been going through many changes. The financial system has impacted several environmental aspects in the economy, federal regulation and individuals. One way the United States financial market can impact the economy is by the use of use of mutual fund improvements using it as a tool for price changes, which will trigger the effect, by identifying the strong outcome of market prices. The decrease in valuation leads to a 7% increase in acquisition, likelihood, relative to a 6% takeover possibility. In addition, globalization has an impact in the financial markets by reducing companies' cost of capital. Furthermore, globalization also helps improve corporate governance in a way that manager engagements are better aligned with stakeholder interests. This progress in corporate governance further contributes to a reduction in a firm’s cost of capital. Another impact on the organizations are the cost of raising resources in capital markets (its “cost of capital”). On the other hand, there are conditions under which globalization improvements itself has led to a decrease in United States cost of capital. Financial markets had not just impacted the economy, businesses, and individuals of the U.S. but also had an effect in the economy all over the world. The United States Federal Reserve have very important role in the expenditures system of the country. There are twelve Federal Reserve Banks that provide finance...
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...s’eveillera, le monde tremblera” (“When China wakes up, the world will tremble”), Napoleon Bonaparte. This expression is indeed, justified by the spectacular economic growth of China the past 3O years and by the fact that today, China is considered as one of the most important economic power in the world. Our country has known many changes: from the gai ge kai fang, under the leadership of Deng Xiao Ping where China experienced effective agricultural reforms, to our days when China, with 1/5 of world population, opened its doors to foreign investment, privatization, and export, leading to unprecedented growth. However, this growth is confronted with many challenges, external or internal. Among them, environmental issues are the most evident and urgent. In fact, this explosive growth has left scars across China's landscape and environment. Which lead us to our problematic: How the environmental issues can affects the economic development of China? And what are the solutions? Current situation * Overview of the Chinese economic development Since the opening policy in 1978, China has been the most rapidly growing economy in the world. And even if there is a certain tightening of the economy policy of the government and in spite of the rise of the price of raw material, this growth doesn’t have until now given any major sign of breathlessness (6% for the trimester of 2008). In July 2007, China is the fourth world economic power behind the United States, Japan and Germany...
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...slowing growth rates on the global environment. The issue is that the Chinese economy has become a significant world player and “the evolution” of its business cycle will have severe knock-on effects on the rest of the world economy, particularly in Australia. The article highlights the economic implications of China’s slowing growth rates as Australia’s most important trading partner; for example Boyd reports that China’s imminent economic performance “will have a direct bearing on the Australian dollar” which is a “proxy for investment in developing Asia”. Boyd also argues that “Australia is at stake...if China’s economy stumbles” because China is a major investor in Australian resources and infrastructure. Boyd emphasises that due to Chinese demand for Australian commodities, a downturn in the US economy no longer has an immediate impact on the Australian economy. Further, of global lending, Boyd says that “banks are still pumping money into China” because they are heavily relying on the “Chinese miracle economy” to grow for some time. The article reports that high-inflation and a decrease in money supply are causing the Chinese economy to contract. As China is a globalising economy, these contractionary factors have implications not only for China, but for global economies. The reported downturn of China’s economy relates to aspects of CISS2001. This particular case demonstrates that a nation’s transformation from a centralised, closed economy into an open one intensifies...
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...Map the likely evolution of the BRICS. What indicators might companies monitor to guide their investment and actions? Over the next 50 years, Brazil, Russia, India and China_ the BRICS economies_ could become a much larger force in the world economy. We map out GDP growth, income per capita and currency movements in the BRICS economies until 2050. [pic] BRICS countries have also diversified their source of imports and are trading more with other large emerging economies and developing countries. They play an important role in the global economy, and their role in the future of global economics seems more evident. Demographic shifts are taking place and BRICS states, especially India and China, will have much of the world's youth, a driving force behind growth of consumer spending and innovation These countries have large numbers of highly qualified professionals and technicians, and their skilled labor means they will remain competitive across the globe. Their large domestic markets will create economies of scale that make BRICS' geographies central to global production and demand. And they will emerge as centers of innovation and new product development. Indian manufacturing and IT companies are making serious moves in China, and demonstrating their ability in high-tech engineering, software development, banking and foreign exchange trading. Chinese companies have an impressive export record and have emerged as important suppliers for infrastructure projects...
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...was an energizing experience throughout the semester and preparing this assignment further enhanced my insight about International Business. I hope that this report fulfils your requirements and your feedback is very much necessary to overcome my faults and lacking. This will help me in my entire life. It is my pleasure to carry out this assignment under your supervision. I would like to request you to accept my report for further assessment and I will be available to answer any question for clarification. Thank you for your sincere support. Yours sincerely, Arafat Rauf 2009-2-10-345 Table of contents Title | Page number | - BRIC | 4 | Economic growth of BRIC | 7 | Question 1: Map the proposed sequence of the evolution of the economy of the BRIC’s. What indicators might companies monitor to guide their investments and organize their local market operations? | 8 | Question 2: What are the implications of the emergence of the BRICs for careers and companies in your country? | 8 | Question 3: Do you think recency bias has led to overestimating the potential of the BRICs? How would you, as a manager for a company assessing these markets, try to control this bias? | 9 | Question 4: How might managers interpret the potential for their product in a market that is, in absolute economic terms, large but, on a per capita basis, characterized by a majority of poor to very...
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...44 CLASH OF GENERATIONS- ECONOMY OF FUTURE Clash of Generations- Economy of Future Titans vs Olympians Mythology, History and Folklores have innumerable tales about the revolutionary clashes in ideologies, tumultuous transitioning of control, usurping power, tectonic economic shifts and a period of unrest and clamor during the cusp. The wax of Digital Native and wane of Generation X/ Baby Boomers heralds for another “Clash of Titans”. The Titans are finding a desperate way out of the byzantine financial models, spiraling debts, vagaries of stock markets and socio- economic crisis so that the posterity gets a better world to dwell in. And, at the same time there is an uneasy stir amongst the Olympians about the world that will be soon bequeathed to them. A view into the Crystal ball The future looks bleak if not dark for the future generation. Some of the jittery statistics are: 1) The average debt on every individual/ Country will go down to further abysmal levels because of financial imbalance (OECD Economic outlook 2012, pp.191) 2) Energy prices will soar up because of the drying oil pool and ever increasing demand from developing nations. (Barkindo. M 2006) 3) Housing Prices will double by 2025 because of urbanization and inflation ( CEBR 2005) 4) Economic model for Government and welfare structures might crumble due to a dwindling beneficiary/contributor ratio (DeVoe. J.E. et al 2005) Definitely these numbers don’t augur well for the Marshall’s “Demand –Supply”...
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...source.Outsourcing has benefited individuals, businesses, and the world for centuries, however, through its brutalized international evolution, the country could suffer. The first type of individual outsourcing that everyone has been aware of for centuries is obtaining domestic help. The world has outsourced in this way for a very long time. Everyone has done this for similar reasons as to why anything is outsources because it saves time and efficiency while wanted tasks improve. Proclaimed in U.S. News & World Report - Money on “Why You Should Outsource Domestic Chores”...
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...Peru’s economic competitiveness has been sustained by regulatory reforms and open-market policies. Macroeconomic and monetary management is relatively prudent, with a structural fiscal rule keeping the level of public debt among the lowest in the region. Nowadays the world lives the era of globalization, characterized by economy and markets expansion, media, and transportation. With it, a new competitive environment arises, requiring countries to open their economies in order to communicate them with these new markets. Peru, a country located in the western coast of South America, is not the exception. Though, it has significant challenges to face in its economic development. (voxeu.org) A country sharply divided in three geographic regions: In the North-west coastal areas contain primary oil deposits. Main traditional agricultural products including cotton, fish, and fruits grow along the Pacific coast. And most mineral resources, that involve approximately half of Peru's exports, come from mines in the Andes. However, despite this bunch of resources, Peruvian economy is essentially heterogeneous, and markets segmentation is extremely high. This can be attributed to major obstacles, differences and barriers in access to these resources companies need to grow their competitiveness. An easier way to classify productive specialization in Peru is by dividing its GDP into four large economic sectors: extractive or primary activities (agriculture, fisheries and mining); basic transformation...
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