Friday, September 28, 2012

International Economics

International econ is an important extension of economics, one of the more important subjects we learn about in business. I'm not quite sure I got everything I could have out of this particular course, due to some peculiarities of its delivery.

The first peculiarity is simply that it was a summer course. Of course, I love summer courses for their intense, focused nature and then how quickly it's over. The second peculiarity was related, kind of. The related part was that it was summer, very hot, and the cooling system in the Natural Resources building where we were meeting went out.

At least one day class was cancelled due to the heat and probably HVAC technicians working on the problem. One day we met outside. We just sat around on the ground - grass, cement, whatever - and talked as other people walked by and our voices floated off to nowhere instead of bouncing back off the wall in the strangely shaped auditorium (extra steep and building support pillars blocking the view from some seats. Several days were spent with industrial strength fans blowing on us, drowning out part of the conversation. If it wasn't a compressed summer course, missing a day wouldn't have put us behind so far, plus it probably wouldn't have been as hot, and there would have been more days in between to get it fixed before the next time we met.

Getting to the actual content of the course, I think we would be better off as a country if more of us really understood these concepts. We hear about issues with other countries like Greece not being able to pay their debts but don't really understand how that affects us. We talk about manufacturing jobs being sent to China, but what does that do other than send some of our jobs there?

As interconnected as the world market is, everything we do affects others. Our stock exchange may close but another one on the other side of the world is opening. Arbitragers are constantly trolling for pennies of difference in exchange rates in different markets in order to run a pile of money through both markets and capitalize on the difference. We want free trade, yet some tariffs help protect jobs in our country in order to ensure we don't lose critical skills and become dependent on others.

Listening to the political debates currently going on, there are expectations that the president or other political leaders have much more control over world events than they actually do. You can't instantly create millions of jobs like Obama claims he can do. Romney's claim that he can stabilize our economy by helping people in other countries start businesses likewise sounds nice, but is a fairly unmeasurable long term plan that depends on a lot of factors to come together.

We listen to statements from everyone running for office, and it's hard to separate what's realistic or not without a firm understanding of the principles that affect international trade. The real improvements in worldwide economies can only come through many sides working together in the long term, following sound economic principles. No one is really interested in that as they focus instead on squeezing a couple cents profit times thousands or millions of dollars or shares of stock traded while markets are synching.

photo by carderel

No comments: