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As with most things in life, there are good and bad elements to globalization. The idea behind globalization is that we live in a world with a lessening of borders. In short, we draw talent and resources from the world and make things more effective. The positive points of this are clear. You draw from a greater pool of talent, things could be more effective and cost efficient, and you can market to the world as well. There are challenges though. First, there are language barriers and cultural differences. Also there are transportation costs, which can be big, especially as the price of oil goes up. You may also hurt a domestic work force, if everything is shipped to another country.
The crisis of economic confidence is when the world does not know how to get out of an economic crisis such as the one we are in. For example, the debt problems in Greece are huge. What should we do? There is little consensus. This is causing a problem of confidence.
As a result, since countries are all interrelated due to globalization, when one country has a debt problem, it affects others as well. The ripple effect can be enormous. Very few things are self-contained.
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