North America's Economy: From Beginning to End

History

North America's economy has gone through tough times in order to grow. There have been a number of events that have either hurt the economy or helped it. In the 1920's there was a lot of economic growth because of increased income. The large increase in the ability of private citizens to get credit also resulted in an increase of consumer spending which boosted the economy.

However, the Great Depression was an event that hurt the economy. Canada and the United States experienced large declines in the gross domestic product. The growth domestic product fell 37% from 1929 to 1933 in the United States. In Canada it fell 43% over the same time. The United States, Mexico, and Canada experienced some other changes during the Great Depression, too. Canada and the United States introduced unemployment insurance and minimum wage to their businesses. Mexico nationalized some of its large industries during the Great Depression such as its oil industry. 

World War II helped North America's economy by practically eliminating unemployment in the United States. When all of the men left to fight in the war, the women filled in the manufacturing and technical jobs that had once been only open to men. This gave jobs to many of the women in the United States.

Current State 

The current state of North America's economy is not good. It is falling rapidly from different causes. Some of these include falling stock markets, rising prices of goods and gas, and the housing crisis. A falling stock market can cause a failing economy. Since most of North America's people have some money in stock, most of its wealth is in stock markets. So, if the stock markets crash then it causes the economy to fail.

Rising prices are bad for the economy too because as prices rise, families have to spend more money on buying their basic needs, so they spend less money on luxuries. However, this is not good for the companies who create those luxuries because they go out of business when nobody can buy their products. Less businesses mean less jobs which raises the unemployment rate. When there is a high unemployment rate, there is a bad economy because when people don't have a job they can't make money to support themselves.

A failing economy can also be caused by the housing crisis. When a family can't afford their house then they usually have a hard time affording other necessities. As people can't pay for their houses anymore, more houses become foreclosed which is bad for the economy.

Industry

North America has plenty of industries which make its money. These include commercial farming, forestry, oil, coal, uranium, copper, gold, nickel, livestock raising, trade and manufacturing, and subsistence farming. All of these are found throughout North America's three major countries: the United States of America, Mexico, and Canada.

Some of the land uses of this continent are commercial farming, forestry, livestock raising, trade and manufacturing, and subsistence farming. Commercial farming is found in the Midwest U.S. and the provinces Alberta, Manitoba, and Saskatchewan of Canada. The people who farm, sell their crops around the world. They produce about half of the world's grain exports. Forestry is found in Mexico and corners of Canada and the United States of America. North America was once covered in thick forests. Overtime many of the trees were cut down for fuel and lumber or made into furniture. Livestock raising is found in Mexico and on the western range of Canada and the United States of America. Cattle graze widely here and sheep ranches are common too. Trade and manufacturing is found in Mexico, the urban areas of Canada, and in the Midwest and Northeast of the United States of America. Factories in these areas produce cars, steel, plastics, glass, and textiles. Mexico supplies many of the parts for American cars. Subsistence farming is found in Mexico. Subsistence farmers grow just enough food to feed their family. They can sell or barter their extra food for other things they need. Important crops in Mexico are corn, potatoes, and beans.

The most important resources in North America are coal and oil. Coal is found in the United States of America and is used for energy. It is plentiful in the Rocky and Appalachian Mountains. Also, it is mined in the river valleys of the Central United States. Oil is found in Mexico, the states Texas and Alaska of the United States, and the province Alberta of Canada. These areas have large oil deposits and thriving oil industries.

Minerals of this continent include gold, copper, nickel, and uranium.  Gold, nickel, and copper  are  found in Canada. They are produced in mines in Quebec, Ontario, and British Columbia. Copper is also found in the United States where it is rich in Arizona. Uranium is found in the western United States in states such as New Mexico where there are large reserves of it.    

Currency

The three main currencies of North America are the American dollar, the Mexican peso, and the Canadian dollar. The American dollar belongs to the United States. Mexico uses the peso currency. And the Canadian dollar is used in Canada.

The American dollar. It is used by all citizens of America to buy whatever they need or want. Although, there is a problem. The value of the U.S. dollar is falling. How did this happen? First, there is the difference in the interest rates of U.S. banks, who just dropped there interest rates, and of other central banks around the world such as the European Central Bank (home of the euro). This has helped to decrease the dollar's value because you could get a better interest rate return holding a euro than a dollar. Second, central banks around the world have been altering their holdings away from dollars to euros, British pounds, and other currencies. This means that there are more dollars floating around in currency markets, and a lower demand for dollars means a lower value. What effect does the falling dollar have on an American citizen? The falling dollar causes the cost of some products, such as oil, to increase. This is because, even if the same amount of oil is pumped out of the ground, since it is traded in dollars and the value of the dollar has fallen, the price has to increase to make up for the lost value of the dollar. When families have to spend more money on products that they need, they have less money left over to pay taxes, mortgages, and other expenses. 

The  Value of One America Dollar in Other Currencies

The Mexican peso. Just like the dollar, the peso's value is falling. This has been mostly caused by the United State's failing economy because since their economy isn't doing very good, they are importing less products from Mexico which has dried up the foreign demand for pesos. The falling value of the peso has had many bad effects on the citizens of Mexico who use it as their currency. One effect of this crisis is the declining ability of Mexican citizens to buy goods across the international border in the United States because as the peso's value falls, dollars become more expensive, and so goods that are priced in dollars become more expensive too. This causes many U.S. goods to be pushed out of a Mexican's family budget which gives families a harder time getting those products since they  can't buy them from where they used to.

The Value of One Mexican Peso in Other Currencies

 The Canadian dollar. Just like the Mexican peso and the American dollar, the Canadian dollar is also dropping in its value. This has been caused by most of the same ways the American dollar and the Mexican peso have lost their values. A falling value is bad news for the people who use that currency because then it is more expensive to buy products from other countries or to travel to other countries since it cost more to buy that different currency. 

The Value of One Canadian Dollar in Other Currencies 

Future

The future of North America's economy can either be good or bad. Some people predict that the economy crisis will get worse before it gets better. Although, others believe that it will get better soon. How can we predict that these events will occur?

In the 1920's the U.S. experienced the largest stock price bubble ever. However, when this bubble popped the U.S. was set for a sharp recession, but it turned out to be quite moderate instead of severe. Avoiding a sharp recession was achieved by a combination of tax cuts, spending increases, and interest rate cuts. However, the avoidance of a deep recession caused imbalances in the economy. These imbalances make the U.S. economy vulnerable to an economic downturn or crisis. The question is: how bad will the crisis get?

There is also a chance that the economy will get better without having a crisis hit. Some ways that could help this happen include the following. People could start using their extra money to buy products to get the economy going. Also, other countries could start investing more in America to help boost the economy. If more people bought more products then it would put many companies back in business which would help the economy. And if other countries would invest more in America, it would definitely help the economy.