enerated a common continental market in automobile production. In this period thevalue of the Canadian dollar was controlled by the Balance of Paymentsmodified by the Bank of Canada's ability to alter the money supply.Under the pressures of the time it rose to $1.10 (U.S.) Canada becamethe second richest country [measured by average standard of living] in theworld. The effect of this, of course, was that Imperialism, Nationalism, andRegionalism - the three corners of the 19th century Canadian Triangle - hadtransmogrified into Continentalism, Nationalism, and Regionalism; withRegionalism supported by Continentalism though differently from the way that Nationalism had been supported by Imperialism in the late nineteenthcentury. Eventually Europe and Japan recovered. Europe began the process of forminga single, continental European economy, and Britain chose to join. Thisleft Canada in a dilemna: to stay with Britain, or make common cause withthe United States in a North American Common Market. Recovery in Europeand Japan brought an end to expansion in North America, and a recessionbetween 1957 and 1962. Thereafter North America expanded again on thedemand generated by industrial expansion in Europe, Asia, and otherrapidly developing countries. The Relative Decline of North America The United States, caught up in the cold War, and eventually the warin Asia, fell behind Europe and Japan in economic growth and growth ofproductivity. The excesses of currency expansion, as the world testedfiat monetary systems, led to inflation, as did the inflationary financingof the Vietnam War, and the United States response to the OPEC oil cartel.[The source of "Petro Dollars"]Then it was that the United States continuing deficit in internationaltrade, emerging from the advances of Europe and Japan, was funded bycapital imports as foreign interests purchased United States concerns. Thecapital inflow was not enough to prevent the eventual devaluation ofthe ...
