International Trade and Finance for Global Logistics MAGL 570 Fall 2010 Steven Yamarik

I. Introduction What we will be learning? This course examines the role of international trade and finance in the world economy. We take a global view of the economic processes, structures and policies that shape the world economy. We examine the world product, labor, capital and currency markets.

I. Introduction A. History of the World Economy 1. First Wave of Globalization: a. Declining transportation costs and lower tariff rates result in greater trade. b. Open borders result in greater immigration.

I. Introduction a. Declining transportation costs and …

I. Introduction a. … lower tariff rates …

a. … result in greater trade. I. Introduction

b. Open borders result in greater immigration. I. Introduction

A. History of the World Economy 2. Second Wave of Globalization: a. Declining transportation costs and lower tariff rates result in greater trade. b. Developed economies specialize in manufacturing production.

I. Introduction a. Declining transportation costs and …

I. Introduction a. … lower tariff rates …

a. … result in greater trade. I. Introduction

A. History of the World Economy 2. Third Wave of Globalization: a. Removal of trade barriers in the developing countries result in greater trade for developing nations. b. Removal of capital controls result in greater capital flows.

a. Removal of trade barriers in the developing world … I. Introduction

a. … result in greater trade in developing nations.

b. Removal of capital controls result in greater capital flows. I. Introduction

B. The Current State of the World Economy 1. The Global Recession has ended.

I. Introduction B. The Current State of the World Economy 2. However, there is slow growth ahead.

I. Introduction B. The Current State of the World Economy 3. A Tale of Two Policies a. The U.S. is pursuing an expansionary monetary policy and neutral fiscal. Fiscal stimulus and likely tax cuts Quantitative Easing II (QE2)

I. Introduction B. The Current State of the World Economy 3. A Tale of Two Policies b. Europe is pursuing a contractionary fiscal policy. Fiscal consolidation in U.K., Ireland, Portugal, Spain and Greece

I. Introduction

B. The Current State of the World Economy 4. World trade is coming back

I. Introduction B. The Current State of the World Economy 5. However, global imbalances remain.