The word “Globalization,” when it comes to economics, has been demonized; most Americans think of empty factories, lost jobs, and a rising China. It has changed the way everyone around the world lives, works, and eats; with the west moving to a service sector economy and the east rising economically, eating better foods and moving from rural to urban areas.
In my opinion, the story for some reason here in the U.S. has been spun in such a way where it appears to be all upside for the rest of the world and all downside for Americans. However as someone who runs an international newsletter, I have to point out that globalization has also created an enormous opportunity for us all.
I know someone who has purchased vehicles here in the states and sold them to China, another who has built a media company by using cheap labor in India, this alternative media company now has a few American reporters and spends probably a million dollars in advertising here in the states. I also have friends who flip residential real estate in Memphis, Tennessee, while living in the middle east. Globalization has blurred our borders, it has taken away these imaginary lines in our world that governments and statists cherish, which to me is a good thing.
I think with globalization also comes peace and prosperity, because the fact is if you are doing business with someone, you don’t want to go to war with them.
Two added opportunities for all of us is the ease of transportation and communication. Last week for example, I woke up in the Caribbean and by dinner time I was in Southern California; and when it comes to communication, not even an hour ago I spoke with a friend in Israel over Skype. I love the world I live in, being able to travel great distances with ease and being able to develop relationships with people around the world, this is all something that no other generation was able to experience in such a way as we can today.
Use globalization to your advantage, there is no reason to get upset or try and stop it, this trend will continue. We aren’t going back and I honestly wouldn’t want to. I like shopping at Wal-Mart just as much as I like shopping at a small mom and pop shop, demonizing companies that employee people around the world and bring lower cost goods to all is trendy socially, but the fact is Wal-Mart has done a lot of good.
Pros of Globalization
- Global competition keeps prices low
- Encourages innovation
- Ideas are being exchanged freely around the world
- International goods available for consumption everywhere
- Economies become interdependent and reduce chances of war
The biggest Con is that globalization can hurt smaller businesses here in the U.S., but I think with innovation and entrepreneurship, new small businesses can be developed, like the ones I mentioned earlier in this email.
My goal isn’t to prove globalization as a trend, it isn’t even to get you to accept it, it is to encourage you to see the opportunity, whether you are an investor who is looking to profit off of the amazing demographics of India or a small business looking for new customers, globalization will continue to effect your life so I hope you choose to allow it to effect you in a positive way.
Look for my Jim Rogers interview being released this Saturday. We discussed investing in the current environment and the key to life success.