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Is It Easier To Conduct Business Across International Borders Today?

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dealing with fx and comparison

Years ago, international business was something only the largest organizations could partake in. After all, it required a great deal of resources, something only businesses like Shell or Coca-Cola had. However, in the digital age, it’s considerably easier for even tiny home businesses to conduct global operations. Let’s have a look at some ways in which international business is easier now. Let’s also look at why so many organizations are opting for this option.

The Internet has made it easier for small companies to trade globally

As the introduction stated, it was once too prohibitively expensive for companies to think about trading internationally. However, thanks to the internet, you often don’t even need to be physically present in a country in order to do business there. It is now far easier to manage an international business without visiting the place in question, thanks to software like Skye, as well as Wi-Fi connections that have never been faster. So, expensive travel doesn’t even have to be on the cards anymore. Plus, services like PayPal have simplified the payment method along with iComparefx being a world first international currency conversion and money transfer services.

All of this coupled with the fact that shipping is much faster now, means that global trade is now within the reach of the smallest organizations.

A more diverse audience

Cultures used to be a lot more distinct in the past. However, with the rise of the global mass media as well as the Internet, these cultures have started to blur around the edges and are becoming more homogenous. Western culture, especially, has influenced countries around the world, so that you’ll find Western clothes and movies everywhere. This means that a company’s audience has already increased, and you should be able to find ready buyers beyond your own country.

By expanding to include more people in your audience, you’ll also be able to produce more units. This will allow you to take advantage of economies of scale, since your cost per unit will lower when you produce more units. Thus, you can increase your profit margins.

There’s less competition abroad

If you’re a small business, you’re likely to be competing with a great many other similar organizations. This is a factor that has led to many businesses moving abroad to make use of economies that have heretofore remained unexplored. Since there will be less competition there, your business will have a larger chunk of the market. Plus, if demand for your product slips in your own country, you can simply make use of another market where demand is still relatively higher. This way, you can continue making high profits even when your sales are in a decline back home.

You can hire people around the world too

Companies now often also go global because of the ease with which they can hire employees that they’ll never even physically meet. The internet has created an economy of freelancing, which can allow you to get projects completed at lower rates instead of having to employ full-time staff.

Three Sources of Extra Income that You Could Be Capitalising On

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chart trading

 

It is human nature to want more. Although you may be lucky enough to have a beautiful home, two cars parked on your driveway, and the funds to holiday abroad at least once a year, it’s a given that if someone told you there were ways to increase your income, you would want to hear about them. Well, here we are, and we’re telling you exactly that.

Intrigued? Then here are three ideas to inspire you…

#1: Seek a Pay Rise or Promotion

 

The obvious place to begin if you’re hoping to increase your monthly income is with your employer, and if you’ve been working hard and delivering good results, it may be time to seek a reward. A lot of people lack the confidence to raise such an issue with their manager or boss, but it’s only fair for your efforts to pay off. Women, in particular, have been shown to be too embarrassed to actively try to secure promotion or a wage increase, yet studies indicate that such requests are often successful, and even on the occasions when they’re not, they’ll usually help to put you at the forefront of your employers’ mind when the next opportunity arises.

#2: Freelance

 

If a wage increase or promotion is not on the cards, it’s time to think outside of the box and start looking for opportunities elsewhere. Freelancing can be a great place to start, and whether it’s using your existing skills to earn a little extra money on an evening, or taking advantage of a hobby and offering tuition to others, there are lots of talents that you can capitalise on. Tout for business both online and locally to maximise your chances of attracting interested parties, and then sit back and wait for your future clients to contact you.

#3: Investing

 

If you’d like to try something else entirely, investing is another option for you to consider. There are dozens of different markets and financial instruments to choose from, from stocks to futures to forex. With various levels of risk and reward across different assets, there’s something to suit everyone, and profit-making opportunities abound. Brokers like AxiTrader are usually all too happy to speak to potential traders, and will offer you the chance to demo their platforms so you can decide whether investing is really right for you before you have to commit.

If you’re looking to boost your income, could one of these methods work for you?

china , yuan and currency manipulation

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Currency manipulation and china

China’s central bank said it will gradually make the yuan’s exchange rate more flexible, indicating that it was ready to break a 23-month-old dollar peg that has come under intense criticism from the United States and other countries.

The People’s Bank of China all but ruled out the one-off revaluation or major appreciation hoped for by critics, saying there was “no basis for big fluctuations or changes” in the exchange rate.

The move comes before a Group of 20 leaders summit in Toronto next week, where President Barack Obama and others were expected to increase pressure for a yuan move. By shackling the yuan to the dollar, U.S. lawmakers and manufacturers say Beijing has gained a trade advantage that costs U.S. jobs.

Is china yuan currency being manipulated ??

China’s deliberate policy of pegging the Yuan to the dollar makes American imports of Chinese goods artificially cheap and gives American companies opening factories in China an artificial subsidy. That’s good for China but bad for America, and helps explain our soaring trade imbalance with China. An extraordinary 83 percent of America’s non-oil trade deficit is with China. During the downturn, our trade deficit with other countries has been shrinking — but not with China.

China yuan and currency adjustments

The wheels of change are starting to turn. The Obama administration stood up to China when it imposed tariffs on Chinese tires and pipes dumped in the U.S. markets. The chattering class called it a trade war, but it’s not. It’s just applying the same rules of free trade that other countries respect, and that China agreed to when it entered the G-20 and was granted permanent normal trade relations with the US. Obama just blew the whistle.

China doesn’t let the yuan float. In the past, they just tied it to the dollar, like 1 dollar = 7 yuan. Right now, it floats a little, I think, by being tied to a “basket” of currencies (probably dollar, pound, euro, yen) and being allowed to fluctuate within a narrowly defined band, so like 1 dollar = 6.8 – 6.9 yuan.

Just because we import more from them than they do from us doesn’t necessarily mean that the yuan should be worth more than the dollar or that it’s currently undervalued. A lot also has to do with the rate of return one gets on yuan-devaluated investments, which, considering China ha

A lot also has to do with the rate of return one gets on yuan-devaluated investments, which, considering China has one of the fastest growing economies in the world, is pretty good..Or is it ?

China’s strategy is to generate full employment (thereby staving off social unrest in the interior) by maximizing exports. Like any exporter, it seeks to keep its currency weak relative to other currencies. So back in the 90s they pegged the yuan to the dollar, I forget at what rate, but at a rate which keeps it weak relative to the dollar.

At the same time, they’ve financed America’s cheap import binge by lending it the money to buy all this crap, which has generally served to weaken the dollar, which weakens the yuan further.

It’s like a crack dealer lending his crackheads the mnoey to buy his wares, to keep them addicted.

Obviously this is mutually unsustainable, but it seems to be a terminal codependency, and both must eventually go down together.

Periodically China talks about trying to disentangle itself from this mess, maybe letting the currency float (which I think is what the Americans want, I’m not sure offhand), retooling the economy for manufacturing for domestic consumption, not relying so much on exports, perhaps importing more from the US….

But how they could do this without destroying alot of jobs and having to run the dire gauntlet of social unrest, or triggering a run on the dollar as they try to maneuver out of their grimly exposed dollar position, is a mystery which so far baffles them, and in practice, no matter what they say they’ll try to do, they just continue with breakneck growth, floods of exports, and the weak currency.

“A heavily undervalued renminbi is the key financial distortion in the world economy today,” write Niall Ferguson, a history professor at Harvard, and Moritz Schularick, a professor of economic history at the Free University in Berlin. “China has carried out what amounts to a beggar-thy-neighbor devaluation, keeping the yuan-dollar exchange rate fixed even as the dollar has fallen sharply against other major currencies,” writes Krugman. Both columns urge President Barack Obama to address the issue with Chinese official during his visit to the country this week.

Both Krugman and the Ferguson-Schularick duo argue that China’s management of the renminbi-dollar exchange rate is artificially deflating the yuan’s value, making Chinese exports more attractive in places like the United States and making exports from all other countries less competitive—and keeping America’s trade deficit with China massive. Ever wondered why everything is “Made in China?” This currency manipulation, Krugman and Ferguson/Schularick say, is a big reason why.

So it would almost certainly be in America’s interests to get China to stop fiddling with the currency markets. Unfortunately, no one really knows how to do that.

China’s central bank said it will gradually make the yuan’s exchange rate more flexible, indicating that it was ready to break a 23-month-old dollar peg that has come under intense criticism from the United States and other countries.
The People’s Bank of China all but ruled out the one-off revaluation or major appreciation hoped for by critics, saying there was “no basis for big fluctuations or changes” in the exchange rate.
The move comes before a Group of 20 leaders summit in Toronto next week, where President Barack Obama and others were expected to increase pressure for a yuan move. By shackling the yuan to the dollar, U.S. lawmakers and manufacturers say Beijing has gained a trade advantage that costs U.S. jobs.

China’s deliberate policy of pegging the Yuan to the dollar makes American imports of Chinese goods artificially cheap and gives American companies opening factories in China an artificial subsidy. That’s good for China but bad for America, and helps explain our soaring trade imbalance with China. An extraordinary 83 percent of America’s non-oil trade deficit is with China. During the downturn, our trade deficit with other countries has been shrinking — but not with China.The wheels of change are starting to turn. The Obama administration stood up to China when it imposed tariffs on Chinese tires and pipes dumped in the U.S. markets. The chattering class called it a trade war, but it’s not. It’s just applying the same rules of free trade that other countries respect, and that China agreed to when it entered the G-20 and was granted permanent normal trade relations with the US. Obama just blew the whistle.

China doesn’t let the yuan float. In the past, they just tied it to the dollar, like 1 dollar = 7 yuan. Right now, it floats a little, I think, by being tied to a “basket” of currencies (probably dollar, pound, euro, yen) and being allowed to fluctuate within a narrowly defined band, so like 1 dollar = 6.8 – 6.9 yuan.

Just because we import more from them than they do from us doesn’t necessarily mean that the yuan should be worth more than the dollar or that it’s currently undervalued. A lot also has to do with the rate of return one gets on yuan-devaluated investments, which, considering China has one of the fastest growing economies in the world, is pretty good..Or is it ?
China’s strategy is to generate full employment (thereby staving off social unrest in the interior) by maximizing exports. Like any exporter, it seeks to keep its currency weak relative to other currencies. So back in the 90s they pegged the yuan to the dollar, I forget at what rate, but at a rate which keeps it weak relative to the dollar.

At the same time, they’ve financed America’s cheap import binge by lending it the money to buy all this crap, which has generally served to weaken the dollar, which weakens the yuan further.It’s like a crack dealer lending his crackheads the mnoey to buy his wares, to keep them addicted.

Obviously this is mutually unsustainable, but it seems to be a terminal codependency, and both must eventually go down together.
Periodically China talks about trying to disentangle itself from this mess, maybe letting the currency float (which I think is what the Americans want, I’m not sure offhand), retooling the economy for manufacturing for domestic consumption, not relying so much on exports, perhaps importing more from the US….But how they could do this without destroying alot of jobs and having to run the dire gauntlet of social unrest, or triggering a run on the dollar as they try to maneuver out of their grimly exposed dollar position, is a mystery which so far baffles them, and in practice, no matter what they say they’ll try to do, they just continue with breakneck growth, floods of exports, and the weak currency.

“A heavily undervalued renminbi is the key financial distortion in the world economy today,” write Niall Ferguson, a history professor at Harvard, and Moritz Schularick, a professor of economic history at the Free University in Berlin. “China has carried out what amounts to a beggar-thy-neighbor devaluation, keeping the yuan-dollar exchange rate fixed even as the dollar has fallen sharply against other major currencies,” writes Krugman. Both columns urge President Barack Obama to address the issue with Chinese official during his visit to the country this week.

Both Krugman and the Ferguson-Schularick duo argue that China’s management of the renminbi-dollar exchange rate is artificially deflating the yuan’s value, making Chinese exports more attractive in places like the United States and making exports from all other countries less competitive—and keeping America’s trade deficit with China massive. Ever wondered why everything is “Made in China?” This currency manipulation, Krugman and Ferguson/Schularick say, is a big reason why.
So it would almost certainly be in America’s interests to get China to stop fiddling with the currency markets. Unfortunately, no one really knows how to do that.