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Block 2; Session 4/5: - Coggle Diagram

- - - - The Current Account: registers payments for imports and exports for trade in goods and/or services, plus incomes and transfers of money to and from abroad made by individuals
      - The Capital account: records all transfers of capital to and from abroad. Eg may involve a ferman firm building a factory in brazil. This is counted as a credit on the brazilian capital fund
      - The Financial account: records financial inflows and also covers claims on or liabilities to non-residents, specifically with regard to financial assets; it includes direct investments, portfolio investments and reserve assets (Investopedia, n.d). Reserve assets are, for example, currencies, commodities or other financial capital held by monetary authorities, such as central banks. Direct investments and portfolio investments are explained in the next section
- - - - Products & services
        
        propriety
        
        comodity
        
        novelty
        
        utility
- - - - "founding countries sought to build a framework for econmoic cooperation to avoid a repitition of the competitive devaluations that had contributed to the great depresion o of the 1930s
      - Competitive devaluations are made by countries that reduce the value of their exchange rates to make their exports cheaper in order to gain a competice advantage over other countries
      - The main purpose is to ensure the stability of the international monetary system - the system of exchange rates and international payments that enables countries (and theri citizens) to transact with each other. The IMF's mandate was updated in 2012 to include macroeconomic and finacial sector issues that have an effect on global stability
    - - Made up of 189 member countres, like a cooperative. These member countries or shareholders are represented by a board of governers who are the ultimate policymakers at the world banks
      - generally, the governers are ministers of finance or ministers of development of the member countries. The World Bank Group has set two goals to achieve by 2030; end extreme poverty by decreasingthe % of people living on less than US$1.90 a day to more than 3% and promote shared prospertity by fostering the income growth of the bottom 40% for every country
    - - Superstar companies eg; GE, apple, facebook, samsung etc
      - Producing items to make consumers life easier
      - Big players - hire lobysits to influence policy making - tax etc
      - Tax avoidance
      - Multinationals
        
        Multinationals can choose where to keep their cash.
        
        Multinationals can choose the currency in which to store that cash.
        
        Multinationals can also choose where their expenses – and, therefore, their profits – are recorded through mechanisms such as transfer pricing. Transfer pricing happens when two companies that are part of the same multinational group trade with each other: when a US-based subsidiary of Coca-Cola, for example, buys something from a French-based subsidiary of Coca-Cola; specifically, transfer pricing occurs when the parties establish a price for the transaction (Tax Justice, n.d.).