We discussed the global and local axes. It's kind of an abstract concept until you use it. Now, we'll learn how to use it:
Select New in the File menu. Then, select Reload Start-Up File from the pop-up menu.
With the cursor over the camera, click the RMB to select it. Note that the Z axis (in blue) in the 3D manipulator is straight up. You can press 5 on the NumPad to toggle to the Ortho mode to confirm that the Z axis is pointing up.
Move the mouse over the Orientation selector in the 3D View header, outlined in the previous screenshot. By default, it is labeled Global. Click on the Orientation selector. Move the mouse up the Orientation pop-up menu and select Local with the LMB. Note that the direction the Z axis is pointing changes as you switch from global coordinates to local coordinates. The blue arrow now points through the camera lens.
Change from Local back to Global and back several times, noting the change in direction. In Local...