1. Globalization will likely continue to expand in the future, because the process is just beginning and still has potential for much more growth. Companies are changing direction to take advantage of globalization, and new paradigms of transport are available to support it, such as multimodal transport and freight forwarding. Virtual warehousing concepts allow merchants to move merchandise more quickly on a drop-ship basis through a fulfillment hub system, making the order of one item from some remote location perfectly doable. Furthermore, the continual increase in online traffic and computer ownership makes it easy for merchants to reach buyers around the world, and an eager global buying public promotes globalization. Since being online puts people in touch with the world, globalization would be hard to avoid even if one wanted to. People are no longer restricted to buying their goods at the store down the street, and any vendor anywhere in the world can compete on pricing; sometimes it is less expensive to buy certain commodities onlineùeven with a shipping fee includedùthan down the street at a retail bricks-and-mortar store with a smaller customer base. As online buying becomes faster due to technological innovations and more secure due to improved security applications, globalization will expand with it. When the store down the street doesnÆt have the DVD of the 1934 classic movie you want, you can find it online, and probably at a lower price than the videos they do stock.
2. Econoland runs a current account deficit of $100 billion in a given year. This suggests a financial scenario in which it has that much in savings that are being invested abroad, probably because it imports more goods than it exportsùwhich would mean that it also has a concomitant trade deficit. EconolandÆs international investment position puts it in a risky place where it is dependent on foreign money to keep growing economically. If s...