GLOBAL INTEGRATION

GLOBAL INTEGRATION

1. VOCAB

   • Depression: a long and severe recession in an economy or market
   • Recovery: the act of improving the economy marking the end of a recession or decline
   • Unemployment: not having a job involuntarily
   • Market volatility: a rapid and unpredicted change in the market; usually for the worst
   • Frederick Hayek: disagreed with the idea of government rule and strongly believed in individual freedom. Believed in monetary policy
   • John Maynard Keynes: believed that unrestricted capitalism like before WW1 and between the world wars had failed and the govt needs to create more programs to hire the unemployed
   • Demand sales economics: a macroeconomic theory which argues that economic growth is most effectively created by high demand for products and services.
   • Nationalization: the transfer of a major branch of industry or commerce from private to state ownership or control
   • Privatization: the transfer of a business, industry, or service from public to private ownership or control
   • Milton Friedman: an American economist who received the 1976 Nobel Memorial Prize in Economic Sciences for his research on consumption analysis, monetary history and theory of stabilization policy
   • Transnational Corporation: a huge company that does business in several countries
   • Trade Liberalization: the removal or reduction of restrictions/barriers on the free exchange of goods between nations. Barriers include tariffs, duties and surcharges, licensing rules and quotas.
   • Public Industry/Public Sector: part of the economy composed of both public services and public enterprises
   • Private Industry: part of the economy owned by private individuals or groups, usually as a means of profit
   • Bretton Woods: the first system used to control the value of money between dufferent countries. An agreement was made amoung the US, Canada, Westrn Europe, Australia, and Japan in 1944.
   • W.T.O (GATT): WTO refers to the countries with members of the Goods Council who oversee the General Agreement on Tariffs and Trade.
   • U.N: stands for United Nations
   • World Bank: an international organization dedicated to providing, financing, and research to developing nations to aid their economic development.
   • NAFTA/EU/ASEAN: 3 trade agreements. North American Free Trade Agreement (Canada, US, and Mexico). European Union. Association of Southeast Asian Nations.
   • Rise of Capitalism: the great economic transformation that changed capitalism
   • Fall of Communism: a time in history when the Eastern European countries ended communism one by one.
   • Great Depression: the longest and greatest economic recession
   • IMF/SAP: International Monetary Fund. Created to work with the World Bank. For short term loans and private ideas.
   • G8, G20: top economic countries in the world
   • Containerization: a shipping method in which a large amount of material (such as merch) is packaged into large standardized containers
   • Foreign Investment: an investment made by a firm or individual in one country into business interests located into another country
   • Foreign Aid: money, food, or other resources given or lent by one country to another
   • National Sovereignty: the idea that independent nations have an organized government and are self-contained and have a right to exist without other countries interfering.
   • Protectionism: the theory or practice of shielding a country's domestic industries from foreign competition by taxing imports.
   • Debt: something that is owed or due; usually money
   • Knowledge-Economy: an economy in which growth is dependent on the quanitity, quality, and acessibility of the information availabe, rather than the means of production.
   • GDP: Gross Domestic Product. Total spending in country
   • Empathetic: to feel for someone else (to understand)
   • Inflation: spending is increasing, prices go up

2. SOLDIERS AND CIVILIANS

   • About 15 million soldiers and civilians were killed during WW1
   • Canada lost more than 66 000 soldiers at age 20 or younger
   • People expected a quick victory, instead soldiers spent years in France

3. THE TREATY OF VERSAILLES

   • Signed after WW1
   • Was supposed to ensure peace and prevent another global war
   • Negotiations of the peace conference imposed harsh conditions on Germany in the form of reparations
   • Reparations= payments for war damages in Britain, France, Russia, and other countries
   • America, Canada, and other delegates warned that the reputations were too severe, but Keynes said that crippling Germany and Austria with war debts would starve people and start another war
   • This treaty required Germany to give up its colonies

4. EFFECTS OF WW1

   • By 1918, WW1 cost Canada $2.5mil a day
   • After the war, interest payments on the country's war debt totaled $164mil a year and soldiers' pensions another $76mil a year
   • As a result, income tax became a permanent feature in Canada
   • Farmers, nurses, factory, workers, and soldiers lead to a shortage of workers
   • Unemployment rose

5. RUSSIAN REVOLUTION

   • In 1914, Russia was ruled by Czar Nicholas II
   • The russian empire covered 1/6 of Earths surface and included nearly 150mil people of more than 100 nationalities
   • Russian peasants had a difficult life that allowed them little control over their labor or property
   • Russian tech, weapons, and leadership were far behind Western Europe and lost many battles
   • 4 million Russians were killed
   • Czar had to give up his throne in 1917 and he hand his family were murdered in 1918

6. WW1 FACTS

   • 3 empires dissolve: Russia, Austria & Hungary, Ottoman
   • 16 mil deaths
   • 20 mil wounded
   • 65 000 Canadian soldiers killed
   • 150 000 canadian soldiers wounded
   • Spanish flu infected 500 mil and 50-100mil died

7. THE GREAT DEPRESSION

   • late 1920's
   • Investors were looking for profit
   • Tuesday October 29 is known as Black Tuesday
   • The Great Depression was an economical depression
   • Prices of shares had been rising, then on Black Tuesday, worried investors started selling and share prices plummeted

8. THE GREAT DEPRESSION IN CANADA

   • Between 1929-1933 Canadian exports fell by 50%
   • By 1933, 26.6% of Canadians were out of work and many salaries had been cut
   • Prarie communities suffered greatly because the price of grain fell after 1929
   • Also, in 1928, an on and off drought began until 1937
   • Grasshoppers flourished and ate much of farmers grain

9. WW2

   • When Germany invade Poland, thats when WW2 starts. Later USA joins
   • In 1933, Hitler was elected
   • On September 1 1939, Germany invaded Poland. Marking the beginning of WW2
   • More than 50 countries were in the war
   • More than 60 mil people (military and civilian) died
   • The countries who suffered most were where it was fought; Germany 3.5 mil, China 1.3-10mil, USSR 7-9mil died
   • In the German death camps, the death toll was 10-26 mil people
   • People in death camps were Jews, Poles, Czechs, Greeks, Romans, Serbs, Ukranians, Russians, homosexuals, disabled, trade unionists, prisoners, Jehovah's Witnesses (anyone who wasnt German)

10. WW2 IN CANADA

    • 42 000 Canadians died
    • Another 54 000 were wounded physically or psychologically
    • In one single raid in Dieppe France, 882 canadian soldiers were killed, 587 wounded, and 1874 imprisoned
    • From 1939-1941 Canada's emploment rose 50% and only 1% were unemployed in the end

11. THE BUSINESS CYCLE

    • Cannot have markets without volitility
    • Unemployment and Recession= decreased output
    • Inflation and Recovery=output increased
    • Boom and Peak=max output
    • Bust and Trough=min output
    • LTP= Long Term Planning
    • Boom; prices go up, inflation, growing economy, increased production, increased employment
    • Bust;prices go down, recession, spending goes down, decreased production, decreased employment