Neoliberal Transition in Latin America Essay Example | Topics and Well Written Essays - 3000 words

Neoliberal Transition in Latin America - Essay Example Economic integration between countries will be examined to see if any neo-liberalism is taking place within the regions of Latin American countries. Discussion includes analysis of manufacturing products and those based on renewable resources mainly in relation to regional development in Chile and the growth of non-traditional exports and labor markets. The paper first examines the origins and thought processes of neo-liberalism. Neo-liberalism maintains people act according to self-interest and that markets yield the most efficient outcome by free trade balances within liberalized capital markets with minimal government intervention in the economy. Karl Marx developed the theory that under capitalism, technical and distributional changes tend to follow specific patterns of evolution. This course of changes coalesces the expansion of output, capital, and employment. (Other mitigating factors include the rise of labor productivity, the real wage, and the capital-to-labor ratio.) Further in the evolution lies difficulty to sustain the progress of labor productivity without resorting to increased amounts of capital investment. The decline of the profit rate creates the conditions for large crises resulting in recessions and unemployment. (These movements and tendencies occur at declining rates of variation (Dumenil & Levy, 2004). Marxist economics is deeply rooted in many Latin countries  and enjoy a strong historical foundation; however, â€Å"with the rise of the Cold War and the increasing United States’ hostility toward  anything remotely progressive, the left in Latin America was first, mildly, and then severely repressed. The list of casualties includes The Arbenz regime in Guatemala; Goulart in Brazil; Allende in Chile and democracy in Uruguay and Argentina† (Noble & Weinstein, 2005).   

Financial Management (Currency Risk Management) Essay

Financial Management (Currency Risk Management) - Essay Example Suppose a U.S tourist flies from New York to London then to Paris then to Munich and finally back to New York. When he arrived at London’s Heathrow Airport, he goes to the bank to check the foreign currency listing. The rate he observed for US dollar is $1; this means that $1 will cost him â‚ ¬ 0.6814. Assume that he changed $2000 for â‚ ¬1362.8 and enjoys a week vacation in London, spending â‚ ¬500 while there are saving â‚ ¬862.8. At the end of the week, he travelled to Dover to catch the Hovercraft to Calais on the coast of France and realizes that he needs to exchange his â‚ ¬862.8 remaining Euro for Swiss francs. However what he sees on the board is the direct quotation between Euro and dollar and indirect quotation between franc and dollars. The exchange rate between any two currencies is called the cross rate. Cross rates are actually calculated on the basis of various currencies relative to the USD$. For example the cross rate between Euro and French fra nc is computed as follows:Therefore for every Euro he would receive 0.009923 Swiss franc and arrives at Czech Koruna, he again needs to determines a cross rate. This time between Swiss franc and Czech Koruna to find the cross rate he must divide the two dollar basis rate.First, we assume that our traveller had to calculate the entire cross rates. For retail transactions it is customary to display the cross rate directly instead of a series of dollar rate. Second, we assume that exchange rate remain constant over time. Actually exchange rates vary every day, often dramatically.