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Do you ever wonder where your jeans come from? I watched a lecture online from Duke University on itunes U and saw a brilliant talk by a man called David Brady. I took notes that I’m sharing with you here.
Mr. Brady calls it a commodity chain. He uses the example of your jeans by asking the question Where do your jeans come from?
Basically, a store gets their jeans from a buyer who buys them from several factories.
For example, one buyer might by from a company in Mexico, another from China.
Not too long ago, Levis jeans, used to be produced in the United States. Now, they are contracted in the Dominican Republic.
It’s a combination of resources. They get their thread from South Carolina. They get their cotton from Texas.
The cotton is assembled in Haiti. Then it is sent back to the Dominican Republic for stone washing and fading. Then the jeans are sent on a big container ship to Miami and finally to Walmart.
This same jeans’ buyer might also be using a Taiwanese company who also manufacturers in China, where the denim where the cotton comes from is from India. The thread and denim come from China. It’s an amazing matrix, says Mr. Brady.
Goods and services are now provided faster and cheaper with an integration of more people.
It’s only since about 1970s that our lives have really changed and become what’s called a global economy. They made a floating dollar meaning that it was no longer attached to gold. When banks were first established, every dollar had real gold attached to it. That is no longer the case, hence a floating dollar.
In the old days they used ships to send things, it took a long time.
Nowadays, we use the internet and airplanes. With the internet, information is available immediately.
According to this Lecture, traditional media outlets are way behind the game, for example, CNN is telling us what the bloggers are reporting.
With twitter, you can have the latest information on any subject that interests you simply by typing a hash key # before the word you are interested in into the search box. For example, if you want to know what’s going on say for the floods in Italy and how you can help by donating to the red cross, type #cinqueterre to see how they are dealing with flood relief into the twitter search box.
What is diffusion?
Diffusion is the active dissemination of products, practice, policy or a set of values.
This also creates an interdependence meaning there is a two way street in an internet culture.
What is Internet Culture?
Internet culture means the flow of products, people and ideas. Where there is internet, culture, ideas, and awareness can be quickly spread.
For example, India is now watching TV and making movies. Iran is having elections. China is exporting toys. US is importing beef from Brazil.
What’s interesting to see is the consequences. Sadly, when there are massive flows of people, there is also an increase of disease.
Life expectancy changes.
Economic Growth changes.
LIfe Expectancy Chart thx to D.Brady. How long will you live?
China and India have massive economic growth and represent half the world’s populations.
Where is the dilemma? Sadly, the bottom billion isn’t growing. It’s a puzzle. Sub Sahara Africa, there are no jobs and few economic opportunities.
The answer includes education
Take the example of a school without chalk, where nobody reads, kids have to only memorize and repeat. The Minister of education says they need more engineers to compete in the global economy. In this case, the government doesn’t meet reality.
In a progressive market, the international government organizations need to come up with plans where their words and promises meet the real needs of the people. For example, Amnesty helps to fuel positive social changes.
Now, the European Union has become a big economy. It represents a massive player and has the highest worldwide consumption. It is multi ethnic and multi cultural.
Which contries are engaged in Trade
50 – 60 percent of the global economy is involved in trade now 89 percent in Asia, that used to be only 10 percent. Affluent democracies include US, Japan, Western Europe, US went from 15-20 percent trade to its current 30-40% in terms of trade. Japan relatively behind Europe and U.S.
Look how trade has risen over the last 30 years for Asia!
Foreign born people in the United States is 2006 was 12 percent where as in 1970s it was 6 percent. Europe has increased foreign born 4 percent foreign born to now 10%. East Asia and the Pacific.
China in trouble because they depend so much on trade, that include layoffs where they feel the results of the economy.
The United Nations supports schooling and build schools for girls in developing countries.
Challenge of European Countries
Fertility rates are dropping in western Europe. In 1970, there were 2.4 children, now the fertility rate is 1.5. Put simply, people have fewer children. More children are needed to support an economy.
What does that mean? It means less and less kids are being born every year. To support and maintain our current economy, it is necessary to have a 2.1 children, according to this lecture.
This need has created a cultural conflict because of the need of immigrants to maintain population.
Which organizations are involved in worldwide economy?
The United Nations.The International Monetary Fund founded after WWII, US and Brittain got together and came up with the IMF in Washington DC with the goal of having stable exchange rates and be a credit rating agency, so you could say what countries are having problems.
Then they started loaning. Post 1970 they said, we’ll give you the loan, stabilize your currency but your they installed conditions such as ensuring that they had to privatize energy. They loaned 16 billion dollars in 2008.
World Trade organization with protests since WWII.
It’s job is to be the judiciary for global trading, resolve disputes between countries. They are famous because they adjudicate the agreements and oversee them without getting involved.
The European Union
They say the European Union will one day be bigger than US and China. Now after two wars in the last century encouraged trade and migration of people in Europe, regional identity still exists but borders are open.
Iceland has been devastated perhaps the most because they poured all of their pension funds in mortgage-backed securities in US then did not controlling shares, and lost their backs. a Case of Portfolio investments.
To watch this lecture, I found it on itunes university, Duke University, entitled, David Brady – Understanding the Global Economy.
