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INTERNATIONAL TRADE, ECONOMIC AND CURRENT TOPICS

ASSIGNMENT 2: NORTH AMERICA

Prof: Navin Ramesar

IBM 200 section 002

St Clair College

Submitted by

Padma Nagini Cheruku -0765705

International Business Management -logistic system

St Clair College
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CONCEPT OF FOREIGN POLICY IN NORTH AMERICA:

The dynamics of foreign policymaking in the US, Mexico, and Canada the three

countries that make up North America have been influenced by political geography, political

culture, and state-society relations. In the past century, Mexican foreign policy stepped a way of

protection from US control, driven by the political traditions of nationalism, populism, and anti-

imperialism. On account of Canada, it has likewise now and again looked for freedom that is

more prominent from the US through monetary patriotism while additionally cutting out a

particular international strategy way of life as a liberal and optimistic center force. Mexican

foreign policy has evolved since the watershed signing of NAFTA.

In the second half of the 20th century, Canada cycled through four somewhat distinctive eras

of foreign policy. The interdependence of the three countries more obvious and more accepted

than on economic issues: trade negotiations, global finance, energy, and the environment. To

deepen economic ties it signed a Trans-pacific partnership and invites its North American trading

partners to join negotiations with the European Union on a Trans-Atlantic pact. These

connections strengthen not only the world's competitive products but also as a powerful voice in

international affairs.

CENTRAL BANKING SYSTEM:

existence and purpose: Early in 1907, Paul Warburg’s entitled “A plan for Modified

Central Bank “ and outlined remedies that he thought might avert panics and Jacob Schiff also

warned that “ unless we have a central bank with adequate control of credit resources, this

country is going to undergo the most severe and far-reaching money panic in its history”.

Financial leaders advocated a central bank with elastic currency after “The panic of 1907 “ and

bankers felt the real problem was that the US was the last major country without a central bank,
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which provide stability and emergency Credit in times of financial crisis. In 1912, Aldrich

introduced a plan but never gained much traction and after under the president, Wilson's

leadership passed the Federal Reserve act in 1913.

The Federal Reserve System is the central banking system of the US today. At the

outbreak of World War 1, it was better positioned than the Treasury to issue war bonds and they

modified its powers, giving it the ability to both create money, as the 1913 Act intended, and

destroy money, as a central bank could. During the 1920’s it experimented with several

approaches, it helped create the late 1920s stock market bubble and the Great Depression.

Role: It performs three primary functions 1. Maintaining an effective, reliable payment system 2.

Supervising and regulating bank operations and 3. Establishing monetary policies. The sale and

repurchase government securities and adjust the discount rate. It also has the authority to change

the reserve requirement, it keeps a small fraction of customers' deposits and rests lend to other

people for home, business, or personal loans.

BITCOIN:

It is a digital currency created in January 2009. It is often described, as a cryptocurrency

is a type of money that is virtual. It offers the promise of lower transaction fees than traditional

online payment mechanisms and a decentralized authority operates it. Without a central bank, it

can be sent from user to user on the peer-to-peer bitcoin network without intermediaries

How it is made: A computer file is stored in a ‘digital wallet’ app on a smartphone or computer.

Every single transaction recorded in a public list called a block chain. By solving the equation

first and adding the next block to the chain, a miner reward with a set amount of bitcoin.

Why it is so valuable: bitcoins are valuable because people exchange them for real goods and
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services and even cash. Every transaction records publicly so it is very difficult to copy Bitcoins,

make fake ones, or spend ones you do not own.

What will eventually happen to bitcoin: Bitcoin will not likely replace the dollar as the world’s

dominant currency. It has many money-like qualities. A person can make payments to buy a car,

or a vacation, many things, if you could get the seller to take it. At that moment it has more hype

on its side otherwise there is not a lot of difference. Its value is highly unstable, by comparison to

bitcoin the dollar is a model of stability. It remains a good store of value. It has lost a touch over

10% of its value in the last week.

Only 21 million bitcoins can be mined in total. Once it has unlocked all the bitcoins, the planet's

supply will essentially be tapped out. When it first launched, the reward was 50 bitcoins and it

halved to 25 bitcoins in 2012. This effectively lowers the bitcoins inflation rate by half every

four years. For every transaction, a fee attaches to it, and the fees representing a few hundred

dollars per block. When the number of transactions on the block chain grows and as the price of

a bitcoin rises and it will function as a closed economy.

NORTH AMERICANS' COMPETITIVE ADVANTAGE ON THE GLOBAL STAGE:

Currently, the US and Mexico are becoming even more economically linked. The US and

Canada have highly urbanized populations. Both have a high degree of cultural diversity.

Abundant mineral resources in the Canadian shield, the Appalachian Mountains, and mountain

ranges in the west. A new urban system leads cities specialized in raw materials and

interconnected by growing transportation network, revival as shipping costs decline and

international trade grow. Rising employment in tertiary sectors. Crops like sugar cane, coffee,

cocoa, and bananas grow on coastal plains and humid mountain slopes. Cotton and hemp are

cultivated in warmer and drier climate zone and these crops are important exports to Central
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America. Forestry is a major economic activity. Mining provides millions of dollars and jobs

throughout the continent.

CONCLUSION:

In 2017, Mexico tallied its highest number of murders, homicides rates in southern

states are rising not only cocaine but also violence if fueled. The proliferation of cartels and

gangs has intensified turf battles over protection rackets. The criminal organizations ready to

kidnap, physically and sexually abuse, or kill them. Central Americans continue to flee from

poverty and violence at home and it causes illegal immigrants from Mexico to the US.

If I become the president of the USA, first I suggest Mexico stop using migration policy as a

bargaining chip with the US and instead redouble efforts to protect migrants and refugees, fight

to decrease the crime, and promote development in southern states so that fewer people are

compelled to flee. Support the military of Mexico's southern border as a means to halt migrant

flows and combat rising crime. Foster exchange of knowledge can use to gang prevention and

gang members rehabilitation in vulnerable cities. By supporting local government efforts to

accommodate migrants and refugees. By providing necessary infrastructure, financial and human

resources to governments of Honduras, EI Salvador, and Guatemala to reduce their dependence

on donations and infrastructure provided by the Mexican government. Mexico having low wages

compared to many and the US is outsourcing employees from Mexico due to this unemployment

increases. Therefore, I would keep the minimum wage payment for labor per hour. Canada

attracts more Guatemalan labor migrants every year than the US does and is mostly

farmworkers. I will propose new policies to stabilize the situation and stop the deadly asylum

journeys, labor-migration agreements with countries such as Canada, funding refugee-

resettlement programs for Central Americans in the US and Canada temporarily. Even though
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some policies are, exist but they are not implementing properly. I will take careful consideration

regarding these policies to mitigate the situation.

References:

Source: foreign policy in North America

. https://www.americasquarterly.org/blog/foreign-policy-made-in-north-america/

Source: central banking system: existence and purpose

https://en.wikipedia.org/wiki/History_of_central_banking_in_the_United_States#The_Federal_R

eserve

Source: central banking system role

https://onlinemba.wsu.edu/blog/the-roles-and-responsibilities-of-the-federal-reserve/

Source: bitcoin and how it is made

https://www.investopedia.com/terms/b/bitcoin.asp

Source: how is it valuable and what will eventually happen to bitcoin

https://www.bbc.co.uk/newsround/25622442

https://www.forbes.com/sites/miltonezrati/2021/01/13/the-question-of-bitcoin/?

sh=5cb2ac16755c

https://www.investopedia.com/tech/what-happens-bitcoin-after-21-million-mined/

Source: North America comparative advantage

https://www.nationalgeographic.org/encyclopedia/north-america-resources/