10 Things that Affect the Global Economy

Ah, the world economy! A complex system of money, labor, and goods all controlled by laws and regulations that are supposed to keep the gears running smoothly. With so many little details and factors that go into the economy, you would think that only large events- those on a global scale to be precise- would rock it. Even web design can have an impact on global economy by influencing people’s emotions. People who are frustrated with hard to navigate sites will not be spending their money at the company or if the design is offensive, they may boycott the company altogether and encourage others to do the same. There are a lot of factors that go into the global economy and although you might be aware of several, there are some that you probably did not know about.

 

1. Labor unions

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Unions can be detrimental to an economy; especially if they decide to strike. Strikes can cost companies valuable time and money as well as hindering the transfer of product.

 

2. College students

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When it comes to big spending, rash decisions, and racking up large amounts of debts, college students are pros at that. The amount of money that they pump into the system can be great, but the amount of debt that they acquire through financial aid can hinder the economy.

 

3. Sexuality qualms

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By now, you have probably heard all about Chick-Fil-A saying that they do not support gay marriage and the boycotting that occurred because of it. Anytime issues of sexuality arise, you can expect supporters to blow large amounts of cash to show their appreciation for the corporation’s stance while others encourage their friends and family to boycott the organization and avoid spending money there.

 

4. Global warming

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Before you roll your eyes and mutter Al Gore under your breath, keep in mind that there is some truth to this. Global warming can lead to a lot of damage as well as migration which can cost corporations a substantial amount of money.

 

5. Patriotism

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Although it is obvious that buying products made across the world helps benefit the world economy, purchasing only locally or nationally made products can hinder the global economy since money is being taken out of it.

 

6. Website design

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We mentioned web design briefly in regards to human emotion already, but it can drastically affect the economy. If a corporation that pumps a lot of money into the system has a poorly designed website, customers are less likely to spend their money there.

 

7. Gender equality

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Although feminism has garnered a lot of negative attention for itself, organizations that support gender equality rights will receive a lot of support- financially and metaphorically- which can affect the world economy.

 

8. Olympics

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People get very competitive during the Olympics and we are not referring to the athletes! During this time, people usually go out of their way to purchase items manufactured in their home country which again, takes money away from the global economy.

 

9. Gas prices

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Although you may think that gas prices only affect your paycheck, they can cost corporations a lot of money when it comes to shipping and receiving needed products.

 

10. Unemployment rates

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High unemployment rates mean more tax payer dollars for the system, less employees to manufacture goods, and a higher amount of stress on the economy.

A Brief Guide to Bitcoins

So, what is Bitcoin? Bitcoin arrived on the scene in 2009 and is a peer-to-peer payment system and digital currency. Similar to PayPal, it allows users to buy a wide variety of items online. So whether you are shopping for the latest Coach handbag, or subscribing to Fighters Only magazine, you can use Bitcoins to make your purchase. It is considered a cryptocurrency (fancy word for digital means of exchange) since it uses cryptography to control the creation and exchange of money. Like PayPal, you will send your payments digitally and in many cases, transaction fees apply which are collected by a third party. However, you may end up paying more in fees for your Bitcoins than you would with PayPal.

 

How does it Affect the Economy?

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With all of the legal issues and in some countries restrictions surrounding the currency, a lot of people are wondering how exactly it affects the economy. Well, like anything that is pumping money into the system, there are pros and cons. We’ll start off with the pros:

1. Obviously, the fact that people are spending money is a good thing; this is stimulating the economy and keeping businesses running and functioning.

2. Also, everybody and their brother are literally chomping at the bit (no pun intended) to get a piece of this currency. Both ends of the pay scale are hopping aboard so you have everybody from doctors to carpet cleaners trying to get in on the action. Even companies like Zynga (they make the addicting Facebook game Farmville) are trying to get a slice of the pie.

3. Digital currency value is now on the rise thanks to Bitcoins. In fact, 2013 saw record highs!

However, there are downsides to the digital means of exchange. Although it is boosting the digital economy and making it easier to purchase products online, it does have potentially harmful effects on the economy:

1. A lot of people are using Bitcoins on the digital black market. We probably do not have to tell you about the repercussions of supporting the black market. Bitcoins users are pumping a significant amount of revenue into the market, which in a lot of cases, funds terrorism.

2. There is no intrinsic value to the digital coins and no central bank. This means that users can spend more money than they legitimately have, putting them in a financial bind later or causing businesses to lose out on profit.

3. With all of the restrictions and controversy surrounding Bitcoins, a lot of countries and companies have refused to use the service. With the United States looking to support Bitcoins, these companies may feel a lot of pressure and be at risk of losing out on money.

 

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Everybody wants it!

Whether you love or hate the idea of Bitcoins, one thing is for certain: everybody wants in on it. Like we mentioned, there are tons of people hopping on the bandwagon and certain companies have began to advocate the use of the currency. The United States is also trying to boost Bitcoins, encouraging companies and individuals alike to hop on board.

How Cloud Services Benefits Volunteer Organizations

With all the struggles and economic injustices that are happening all around us, we are constantly turning to companies in hopes that they too will help those in need. After all, we have spent a significant time logging volunteer hours at soup kitchens and other community aid sources, and we have donated and donated until we are down to our last penny and even that went into the cup of a man who was down on his luck begging for change. After all of our hard efforts, we turn to volunteer organizations like the Salvation Army in hopes that they will continue their contributions and during the Christmas season, we encourage our relatives to keep those ugly Christmas sweaters and instead, donate their spare change to the men and women who are bundled up for hours outside of stores and shopping centers ringing the bell.

 

How Cloud Services can Help Volunteer Organizations

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While we all know that donations and volunteer hours can really help these organizations, what you probably do not realize is that cloud services can also help organizations like Salvation Army and others who are committed to helping those in need. “So, how exactly can cloud services help?” You might be wondering. You may also be asking yourself, “Well, these services cost money. Shouldn’t be sending that money elsewhere?” Well, I have listed a few reasons why cloud hosting services benefit the Salvation Army and other volunteer organizations.

1. They allow remote access to important information. Volunteers may need to get ahold of some important documents while out serving the community. They can access the Cloud and thus this information remotely.

2. A lot of Cloud providers issue discounts to volunteer organizations and some may host the organization’s information for free.

3. By having Cloud services, you can also get your organization’s name out there. Not all organizations are as well-known as the Salvation Army so having a hosting company who will also provide you with a small amount of SEO and publicity will help you get known!

4. Information can easily be lost, stolen, or compromised and this can cause more work for volunteers who are already logging significant amounts of hours. Cloud services offers security and copies of your information so you can rest assured that it will be safe!

Although putting money into cloud services may seem like you are taking food out of the mouths of the needy (literally in some theories), it is actually benefiting both you, your company, your volunteers, and those in need.

The Salvation Army Kettle Season Gives Hope to the Impoverished

A few weekends ago, my good friend, who was the bell-ringing coordinator in her area, roped me into ringing the bell for the Salvation Army. I arrived at Tops and received my apron, bell and candy canes. Once my friend had set up the donation bucket and Salvation Army sign, she bid me goodbye. Thus began three hours of bell ringing.

It was quite fun when the store was actually busy. I really liked to try to guess what each person was thinking. For instance, I couldn’t help but laugh as I imagined the people who briskly walked past me with their heads down thinking, “You can’t see me. You can’t see me!” And then there were the people who seemed genuinely excited to donate. Some even mentioned how they always kept change in their hand during this time of the year just in case there was a bell ringer outside the store. Their generosity warmed my heart.

 

How Does Kettle Season Work?

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Kettle Season for the Salvation Army is more than just buying Facebook likes or buying Twitter followers with their good intentions. It’s a program that involves a lot of hard work dedication and freezing fingers (I say this out of experience). Each church has a designated coordinator who has the important job of counting and recording donations, scheduling volunteers and transporting volunteers.

You should have seen my friend on the day I went to volunteer! She was picking up and dropping off volunteers every two hours! What’s more, this is something she does every single day. I couldn’t help but appreciate her dedication.

Of course, the volunteers are also an extremely important part of the Kettle Season. I met some volunteers who stood literally the entire day. From 8am to 8pm, they were out there in the cold. Yet again, I was humbled by their sacrifice.

 

Where Does the Money Go?

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Here is the important part. Where does all this donated change end up? According to the Salvation Army website, the money gets funneled right back into the community that donated it. As a matter of fact, more than a whopping 6 million people per year are helped through these important donations.

Toys are distributed to children, food is provided for families and small, practical gifts and clothing are given to shut-ins. On top of that, the specific programs are run for the impoverished throughout the entire year. These programs give job training, financial assistance, emergency and transitional shelter, food, day care and much more. In bigger communities, the church takes it a step further by aiding drug and alcohol rehabilitation centers and hospice care for AIDS victims. All of these things would not be possible if it weren’t for the Salvation Army’s Kettle Season.

 

There is Hope

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I am here to tell you that there is hope for the issue of social inequality. There are people and organizations out there who understand how difficult it is for the impoverished to move up the financial ladder. They are working to bridge the gap between the rich and poor and it doesn’t look like they are going to give up on that fight anytime soon.

The Poverty is Bad, the Wealth is Worse

The headlines are everywhere: “India income inequality doubles in 20 years”. This rate of economic injustice is the fastest the world has ever seen. It is no secret that India is rampant with poverty. However, this country also has a staggering wealthy population.

 

Rich men with business diplomas regularly walk past single mothers begging for money. Fancy, three-story houses stand tall in the same town as one-room shacks. And modern motorized vehicles leave burdened bicycles in the dust. Take a journey with me to three very different places in India that all have one thing in common: economic injustice.

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Bangalore. It is a city known primarily for its advances in the technology industry. Businesses are booming in this large metropolis. Just one street contains everything from luxurious jewelry shops to expensively decorated clothing stores. Rich men in suits and gold-laden women can be found on every corner. However, if you go just a bit beyond the main business district, you will be faced with a very different reality. I remember walking through what I liked to call the shack shop area of the city. A large number of homeless people littered the streets, hoping that just one person would take mercy on them. There is one image in particular that will forever be seared into my mind: a small baby, completely naked save for a pair of thick casts wrapped around his legs. The mother, of course, had her hand out, praying that pity would be taken on her child. I’m not sure if the baby’s legs were actually broken but, either way, that was desperation at its worse.

 

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In America, most poverty is seen in cities so it is no surprise that Bangalore is so covered in it. However, in India, the towns are just as worse off. I lived in a relatively small town called Kollegal. Whenever we would go out shopping, we’d pass by this very colorful and well-kept house that always had a specific shiny car within the gates of the property. It looked as if it never moved. Once we made it into the center of town, the opposite extreme was observed. Without fail, a kind elderly man would come greet us. He was on crutches due to a severely deformed foot but constantly had a huge smile on his face. We’d always buy the stickers he’d try to sell in an attempt to reverse his fortunes at least by a small amount. I’ll never forget the enthusiasm he showed despite his dire circumstances.

 

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Our final destination is a place that instilled in me very strong feelings of guilt. It is the state of Goa. This beautiful place is the one of the most popular vacations spots in the country. This place elicits an entirely new culture compared to traditional India. The western people relax on the beach whilst the Indians work hard to please them. The Indians are the shopkeepers, chefs, servers and tour guides. One night, my friends and I decided to go for a walk. Once we’d made it past all the fancy, western restaurants, we reached a moderately secluded part of town. One-room shacks were scattered throughout. We greeted one of our shopkeeper friends who was resting outside her home after a very long day at work. It broke our hearts.

 

I believe it is time that the wealth in India is more equally distributed. I believe it is time for the baby with casted legs, the man with the crippled foot and the woman who worked all day in the heat to get the rewards they deserve.

Pros and Cons of Economic Injustice

Economic injustice has become a thorn in many countries economic policies. This issue has been a source of disagreements among politicians and economics on how it needs to be handled. In simple terms economic inequality refers to the gap between the amount of money or resources owned by a person or group and others. This brings in the issue of “haves” and the “have nots” or the rich compared to the poor. Another debate is the advantages and disadvantages that economic inequality to a nation. Understanding the debate is crucial because it gives insight in the rationale behind the policy and helps in conversation of macroeconomic theory. Below are some of the pros and cons of economic injustice.

 

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Leads to growing opportunity

Most politicians hold that economic inequality is a natural and an important feature of a country’s economic growth. The growth of inequality gap is related to growth of opportunities. In this case the growth is related to the opportunity for advancement through education. In this aspect the inequality that occurs is viewed as reward for some people who have invested a lot in the future. This encourages other people to do the same leading to more growth and development. Such situation leads to extra efforts and hard-work that leads to boost to productivity leading to a higher national output that benefits everyone.

 

Encourage people take risk

Economic inequality encourages people to take risks and set up new business. This is the case because without the prospect of substantial rewards, there would be little urge or incentive to take risks and invest in new business opportunities that leads to more economic development.

 

The trickle down effect

If some people gain more economic power than others, this leads to benefits to other people. This is because such people will create jobs and provide income to others. The gap between the rich and the poor may still exist but the poor is better off because of the opportunity offered.

 

 

Disadvantages of economic injustice

 

 

Leads to inequality

Economic injustice is a major source of inequality that leads to more conflicts and poverty in the society. This is as a result of unfair distribution of resources that makes some people feel they are treated unfairly by others.

 

Unemployment

The rate of unemployment rises because the market fails to represent an inefficient allocation of resources. This leaves many people without any source of income that leads to increased level of poverty.

How We Can Make a Difference

Have you ever wondered why there are a few rich people and billions of poor people in the world? This is a question that many people tend to ask themselves without getting the right answers. However, the only answer to this question is that the world is full of economic injustice, meaning that few people enjoy the resources available. The resources are distributed unfairly meaning that many poor people have no resources they can term as theirs.

It is not surprising that many people live under a dollar per day while some other people earn million the same day. The irony is that these people live in the same society. However, the most important thing is not to sit down and regret this, but to come up with some solutions to fight this economic injustice. Below are some of the ways we can deal with economic injustice.

 

Offer more job opportunities

We can reduce the economic injustice by creating more job opportunities to the middle class and lower class. Our society should now focus on development of more industries and technologies with the main aim of offering jobs that pay higher salaries or wages to people in the middle and lower class. This will ensure that the income level in the society will go higher with the increased opportunities for the people living in the lower levels in the social status. Strict laws regulating the wages must be put in place to avoid the current injustice whereby employees are paid peanuts while the owners of the businesses make millions.

 

Make education more affordable

Many people from the lower and middle class in the society fail to get well paying jobs because of lack of education required. This happens because many cannot afford top pay for the high fees in higher institutions of education. Children from the rich families attain high level education thus attaining well paying jobs. This increases the gap between the poor and the rich leading to the economic injustice being experienced. Therefore, the government should ensure that education at all levels is affordable to all.

 

Taxation

Our taxation system needs to be reviewed whereby the rich or those in high paying jobs should be taxed more and the money distributed to the poor. Not that the money be given in cash, but support education and other services that will help improve the living standards of the poor. This will bring some form of equality that is healthy for the society.

Economic Injustice by Global Institutions – IMF and World Bank

After the devastation caused by World War 2, several global institutions were formed to prevent such an event from repeating itself. While the United Nations organisation was formed to maintain world peace, the International Monetary Fund and the World Bank were supposed to guarantee economic stability and provide economic justice to all its member nations. How far have they succeeded in achieving these goals?

Nobel Prize winning economist Joseph Stiglitz in his book “Globalization and its Discontents” criticized both the IMF and World Bank for not having a transparent method of decision making and shunning out the voices of the poor and developing nations. There is growing opinion that these institutions tend to decide in favor of the western countries under the pretext of helping the needy. For example, the western countries have asked the poorer nations to remove trade barriers that hamper international movement of goods, however the developed western countries have continued with their policies of trade quotas and subsidies, making international trade difficult.

 

 

Role of the US:

The United States of America is thought of as the main culprit in these matters and a prime proponent of western hypocrisy. The Washington Consensus, supported by the US, promotes free market policies and trade liberalization for all the nations. However, poor nations with a weak monetary and fiscal structure are not considered ready for free market policies or trade liberalization which leads to economic instability when these policies are pushed on them. Crises in Asia and Latin America in the late 1990′s as a result of these policies threatened the economic prosperity of the entire world.

 

How International Institutions Cause Economic Injustice:

 

  • The heads of these institutions are always from the developed countries who have little exposure to the problems of the poorer nations. Hence the policies formed by these people are not suited for the under-developed economies.
  • Disproportionate share of benefits are accrued to the already developed nations.
  • International intellectual property rights made it difficult for drug companies in Brazil and India to produce medicines first developed in the west. This lead to the death of thousands of people as AIDS medicine could only be bought from the US at high prices.
  • Commercial and financial interests of the developed nations are always on the agenda while there is little representation from the developing nations.

 

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It is generally agreed that the price paid for globalization has been too high, healthy environments have been destroyed and peaceful political methods corrupted. The failure of global institution like the IMF and World Bank to perform their duties have lead to a bitter relationship among nations and have ensured a volatile economy with s side order of economic injustice.

Why You Should Care About Economy Injustice

Economic injustice is a rampant vice in the present society. It has developed over the years to be a major cancer to the whole world. Almost 1 billion of the world’s population consume 80% of the world’s resources leaving only 20% for the rest of the population. 1.2 billion people in the world are living on less than a dollar per day. Can you imagine how meager a dollar is? you would probably spend it within the first few minutes of the day, and go through the rest of the day without any money. 1.8 billion people survive on less than 2 dollars a day. Fifty thousand people die of hunger each day, so you can’t begin to fathom the weight of this matter. All these problems arise because of a couple of reasons.

 

 

Corruption

The continent where this vice is so rampant is Africa. And the root cause is corruption. Leaders of the various countries in Africa are lead by corruption and want to get everything for themselves. A Central African leader once had a bed of gold while his subjects were dieing of starvation. A South African leader, up to now, is living on a 100, 000 dollars a day while his subjects are in initial stages of civilization. The list is endless.

 

Illiteracy

Again, I am going to use Africa as a reference point. More than 70% of the African population don’t know how to read or write. In fact, they live in total ignorance of modernity. How do you expect an illiterate person know the value of resources and money, let alone know of their existence?

 

 

The huge gap between the rich and the poor

I am going to list for you some facts that will blow your mind. The income of 1% of the world’s richest people equals what 57% of the world’s poorest make in a year. The assets of 358 billionaires in the world exceed the combined annual gross income of countries having 45% of the total world population. The income of the richest 5% equals 114 times the the income of the poorest 5%.

The Gross domestic product of 48 most underdeveloped countries in the world is less than the combined wealth of the world’s 3 richest people. 85% of water in the world is consumed by only 12%. Here is one interesting fact that I will finish with (not because the list of facts has ended, but because I will paint the whole world in a excessively negative image). The cost of pet feeds in Europe per year is far much more than the cost of providing nutrition and healthcare for the total world population.

 

Bridging the gap

The major and most important way to stop economic injustices and bridge the gap between the rich and the poor is by education. Through literacy, people will know their rights, how to use their resources, and how to make and spend money. The more people in the world are educated, the more the economic state of the world increases and economic injustices are minimized. Likewise, there should be equitable resource distribution of the world’s resources.

Financial aid should be given to countries at minimum interest rates. Finally, a world watchdog organization should be formed to ensure the nations of the world are on their toes in fighting economic injustices. We must do away with this vice once and for all!