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August 31, 2007

Carnival Midway from The Jerk Welcome to the Friday, August 31, 2007 edition of On the Moneyed Midways, the blogosphere's only collection of the top posts from this week's best business, economics, investing and otherwise money-related blog carnivals!

We know that it's the end-of-summer mandatory government holiday weekend for many of our U.S.-based readers and since so many of you are anxious to get started with that, we'll get straight on with this! Scroll down for the best posts of the week that was....

On the Moneyed Midways for August 31, 2007
Carnival Post Blog Comments
Carnival of Money Stories Teaching My 3 Year Old the Value of Two Dollars I've Paid for this Twice Already The 30-something married PhD mom of two shares her story of how a trip to a musuem provided the opportunity to teach her toddler the benefits of saving for something later.
Carnival of Real Estate Should Your Home Valuation Deserve to Appreciate if You Install a Pool? Digerati Life Did you know that in some areas of the U.S., it can add as much as $100,000 to the sale price of your home if you filled in your swimming pool? Another great post (and pictures) from the Silicon Valley Blogger who points out the many negatives of owning a pool!
Carnival of the Capitalists A Simple, Three Step Program PowerWealth We found Logan Flatt's satirical take on how following his "Live to Fail Always" three-step program to guarantee that you'll end up on the street living on government assistance to be not just thoroughly entertaining, it's also Abolutely essential reading and a very near contender for The Best Post of the Week, Anywhere! this week.
Cavalcade of Risk What Are the Real Savings in Medical Tourism? MedTripInfo Dr. Michael D. Horowitz challenges the claims of 90% savings for having a hip replacement procedure performed elsewhere in the world, taking into account the patient's opportunity costs in finding that their actual total savings are roughly 75%.
Economics and Social Policy The Deeper Message of Financial Markets' Volatility Trusted Advisor Charles H. Green writes about the shift in the way in which the business world works, where success now depends more upon customer strategy than corporate strategy in The Best Post of the Week, Anywhere!
Festival of Stocks Stock Analysis - Burlington Northern Santa Fe Corp (NYSE: BNI) Investment Jungle Warren Buffett recently bought into the rail company, but Average Joe's detailed analysis suggests he paid too much, especially going by Phil Town's Rule #1 style of investing. What opportunity does the billionaire see here?
Odysseus Medal (Real Estate) The Sacrosanct 6% Commission - How About 12%?! Phoenix Real Estate Guy Jay Thompson weighs in on a development in the Phoenix real estate market where a seller's agent is offering a 12% commission for the buyer's agent if they close on the sale of a home priced at $450,000 and wonders how a real estate agent can possibly satisfy their fiduciary duties to their clients if they pursue the deal.

Previous Editions

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August 30, 2007

Not long ago, we introduced our GDP bullet chart, which allows us to present a wealth of recent and historic economic output data in a very small space. We've been tinkering with this method of data visualization off and today's release of the preliminary GDP data for the second quarter of 2007 provides an opportunity to show what we've done with it in the days since we first presented it.

First, here is our combined presentation of both the one-quarter and the two-quarter change in Real GDP in one image (click the image for a larger version): Preliminary 2007Q2 Real GDP Data, One-Quarter and Two-Quarter Growth Rates

We have widened the bars and increased the font sizes to make them more readable at the smaller scale at which Blogger presents larger images.

Widening the bars also makes it possible to incorporate more data. Now, in addition to the growth rate of just one-quarter ago, which appears above the current quarter's bar, we've also incorporated the growth rates measured two quarters ago below the current quarter's bar.

The benefit of adding this information is that we're now able to span a longer period of time in our comparatively small space. The one-quarter Real GDP growth rate now directly presents data going back over the previous three quarters, while the two-quarter GDP growth rate bullet chart quickly communicates data covering a one year period of time. The tables below illustrate the time periods covered for each bullet chart. First, for the One-Quarter Real GDP Growth Rate Bullet Chart:

One-Quarter Real GDP Growth Rate Bullet Chart
Quarter Represented Start of One-Quarter Period End of One-Quarter Period
Current Quarter End of Previous Quarter End of Most Recent Quarter
One Quarter Ago End of Two Quarters Ago End of Previous Quarter
Two Quarters Ago End of Three Quarters Ago End of Two Quarters Ago

And for the Two-Quarter Real GDP Growth Rate Bullet Chart:

Two-Quarter Real GDP Growth Rate Bullet Chart
Quarter Represented Start of Two-Quarter Period End of Two-Quarter Period
Current Quarter End of Two Quarters Ago End of Most Recent Quarter
One Quarter Ago End of Three Quarters Ago End of One Quarter Ago
Two Quarters Ago End of Four Quarters Ago End of Two Quarters Ago

All of this is presented against the historical context of GDP growth rates in the U.S. Here, we've kept the GDP growth spectrum much as before, with the color transitions coinciding with post-1980 rates of economic growth as measured by "temperature" gradients, indicating cold (purple-to-blue), cool (blue-to-green), moderate (green-to-yellow), warm (yellow-to-orange) and hot (orange-red).

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August 29, 2007

Political Map of South America, 2006 Political Map of North America, 2006The third stop in our continuing series comparing the relative economic performance of the nations of the world brings us to the entire Western Hemisphere!

As in previous weeks, we've once again provided a dynamic ranking table to show each of the countries' Gross Domestic Product (GDP) adjusted for Purchasing Power Parity (PPP), their population and GDP-PPP per Capita for 2006. We've also determined each country's annualized rate of growth of their GDP-PPP per capita since 2004.

As we've seen in our rankings from previous weeks, the fastest growing nations in our survey all share a unique economic characteristic, or rather, they share one particular industry that has seen major growth as a major component of their economies. Unlike previous weeks though, it's not the oil industry - we'll have the answer to which industry it is below the table.

Speaking of which, you may sort the data in our dynamic table below by clicking any of the column headings. Doing so will sort the data in the table from low to high value or from high to low (by clicking a column heading a second time.) To restore the original order, you'll need to refresh the page in your web browser.

2006 GDP-PPP for the Americas
Country Population GDP-PPP GDP-PPP per Capita Pop. Est. Date GDP Est. Date % Change GDP-PPP per Capita, Since 2004
Antigua and Barbuda 69,108 1,145,000,000 16,568.27 July 2006 est. 2006 est. 22.9%
Argentina 39,921,833 608,800,000,000 15,249.8 July 2006 est. 2006 est. 11.1%
Aruba 103,484 2,396,000,000 23,153.34 July 2006 est. 2006 est. [2] 3.1%
Bahamas, The 303,770 6,556,000,000 21,582.12 July 2006 est. 2006 est. 10.5%
Barbados 279,912 5,146,000,000 18,384.35 July 2006 est. 2006 est. 5.8%
Belize 287,730 2,307,000,000 8,017.93 July 2006 est. 2006 est. 10.9%
Bolivia 8,989,046 27,870,000,000 3,100.44 July 2006 est. 2006 est. 10.1%
Brazil 188,078,227 1,655,000,000,000 8,799.53 July 2006 est. 2006 est. 4.2%
British Virgin Islands 23,098 1,008,000,000 43,640.14 July 2006 est. 2006 est. [2] 6.5%
Canada 33,098,932 1,178,000,000,000 35,590.27 July 2006 est. 2006 est. 6.3%
Cayman Islands 45,436 2,472,000,000 54,406.2 July 2006 est. 2006 est. [2] 11.5%
Chile 16,134,219 202,700,000,000 12,563.36 July 2006 est. 2006 est. 8.4%
Colombia 43,593,035 374,400,000,000 8,588.53 July 2006 est. 2006 est. 13.7%
Costa Rica 4,075,261 50,890,000,000 12,487.54 July 2006 est. 2006 est. 14.1%
Cuba 11,382,820 45,510,000,000 3,998.13 July 2006 est. 2006 est. 15.5%
Dominica 71,727 485,000,000 6,761.75 July 2006 est. 2006 est. [1] 10.4%
Dominican Republic 9,183,984 77,090,000,000 8,393.96 July 2006 est. 2006 est. 15.4%
Ecuador 13,547,510 61,520,000,000 4,541.06 July 2006 est. 2006 est. 10.1%
El Salvador 6,822,378 33,680,000,000 4,936.7 July 2006 est. 2006 est. .3%
Grenada 89,703 982,000,000 10,947.24 July 2006 est. 2006 est. 49.1%
Guatemala 12,293,545 61,380,000,000 4,992.86 July 2006 est. 2006 est. 9.5%
Guyana 767,245 3,711,000,000 4,836.79 July 2006 est. 2006 est. 8.5%
Haiti 8,308,504 14,790,000,000 1,780.1 July 2006 est. 2006 est. 6.3%
Jamaica 2,758,124 12,820,000,000 4,648.09 July 2006 est. 2006 est. 6.4%
Mexico 107,449,525 1,149,000,000,000 10,693.39 July 2006 est. 2006 est. 5.6%
Netherlands Antilles 221,736 3,400,000,000 15,333.55 July 2006 est. 2006 est. [2] 16.8%
Nicaragua 5,570,129 17,330,000,000 3,111.24 July 2006 est. 2006 est. 16.3%
Panama 3,191,319 26,040,000,000 8,159.64 July 2006 est. 2006 est. 9.1%
Paraguay 6,506,464 31,260,000,000 4,804.45 July 2006 est. 2006 est. -.3%
Peru 28,302,603 186,600,000,000 6,593.03 July 2006 est. 2006 est. 8.1%
Puerto Rico 3,927,188 75,820,000,000 19,306.44 July 2006 est. 2006 est. 7.2%
Puerto Rico 3,927,188 75,820,000,000 19,306.44 July 2006 est. 2006 est. 7.2%
Saint Kitts and Nevis 39,129 726,000,000 18,554.01 July 2007 est. 2006 est. 45.8%
Saint Lucia 168,458 1,179,000,000 6,998.78 July 2006 est. 2006 est. 15.2%
Saint Vincent and the Grenadines 117,848 864,000,000 7,331.48 July 2006 est. 2006 est. 58.5%
Suriname 439,117 3,136,000,000 7,141.6 July 2006 est. 2006 est. 28.7%
Trinidad and Tobago 1,065,842 21,120,000,000 19,815.32 July 2006 est. 2006 est. 37.6%
United States 298,444,215 13,130,000,000,000 43,994.82 July 2006 est. 2006 est. 4.7%
Uruguay 3,431,932 37,540,000,000 10,938.45 July 2006 est. 2006 est. 11.2%
Venezuela 25,730,435 186,300,000,000 7,240.45 July 2006 est. 2006 est. 11.7%
The Americas (All) 884,834,571 19,300,973,000,000 21,813.09 July 2006 2006 5.7%

Caribbean Dreams

Political Map of Central America and the Caribbean, 2006 The big winners in growing their GDP-PPP per capita were many of the island nations of the Caribbean. While GDP-PPP figure is nearly double the previous year's figure with no good explanation, it's clear that the Caribbean was the place to be to realize rapid growth in the Western Hemisphere from 2004 to 2006.

The biggest clear winner would seem to be the island nation of Grenada. Here, the rebound of the island's tourism and agriculture industries following the destruction of Hurricane Ivan in 2004 helped seal a strong annualized rate of growth of 49.1% in GDP-PPP per capita over the two years since.

The next big winner would seem to be Saint Kitts and Nevis. Here, although we see the second greatest increase in GDP-PPP per capita in the western hemisphere, this result is partly an artifact of combination of the nation's decline in population and the revival of the tourism industry across the Caribbean from 2004 to 2006.

Here, the nation's population loss was in large part driven by its government's move to shut down its money-losing state-run sugar production operations in 2005, which resulted in an out-migration from the island. While this was happening however, the nation benefitted from the revival of tourism following the September 11, 2001 terrorist attack against the United States, which greatly impacted this industry throughout the Caribbean. Strong tourism growth combined with a smaller population helps account for the nation's blistering 45.8% rate of GDP-PPP growth per capita.

Number three on the rapid growth rate scale is the nation of Trinidad and Tobago. Here, increased tourism combined with revenues from the island's oil refining and production operations, which benefitted from increasing world prices for oil and gasoline, helped deliver remarkable GDP-PPP per capita growth from 2004 to 2006.

Moving to the continents of North and South America, we find solid growth from Canada down through Chile, with some really impressive growth in Suriname, which has benefitted from higher world commodity prices for its large mining industry.

Sources and Acknowledgements:

Previously on Political Calculations

2006 Economic and Population Data

2004 Economic and Population Data

2002 Economic and Population Data

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August 28, 2007

Sad Puppy One of the hardest things to do in life is to apologize. Yes, you recognize that you may need to offer an apology, but should you apologize? And if so, how should you apologize?

The reason why apologizing can be so difficult is because of that combination of personal pride, shame and even fear that often gets in the way of building better relationships. You may know you need to say something, but what's the appropriate thing to say and do?

If you're someone like Dean Barnett (pictured above right), apologizing is a frequently practiced event for which you've overcome your innate fears through repetition. But if you're not as seasoned as Dean Barnett, apologies can be a lot harder to accomplish.

Once again, Political Calculations enters into the realms of personal interaction where normal people fear to tread! We've converted Geek Logik author Garth Sundem's math into a tool you can use to counter the forces of fear, uncertainty, shame and your personal pride in deciding not just if you should apologize, but also how.

Factors that Can Affect Your Decision to Apologize
Input Data Values
How big of a deal was the issue?
(1-10 with 1 being "forgot to take out trash before work" and 10 being "forgot to turn off the gas before leaving for vacation.")
Actual responsibility
(On a scale of 1-10, how responsible are you in reality for this blunder?)
Perceived responsibility
(On a scale of 1-10, how responsible does your significant other perceive you to be in this matter?)
How pissed off is your significant other?
(1-10 with 10 being "mail-order thumb screws have already arrived.")


Should You Apologize?
Calculated Results Values
Your Apology Factor
What You Should Do

Your Personal Apology Action Strategy

Apology Effectiveness Scale If you scored an apology factor less than one, you've lucked out and an apology is not required. For the sake of good manners though, you should at least acknowledge the situation, for example if you missed trash pickup service on Wednesday, you could say "I should take out the garbage on Tuesday evening." There's no apology in that statement, but there's a recognition there that may help defuse any building pressure within the person to whom you would be apologizing!

An apology factor between 1 and 5 means that you can get by simply by saying "I'm sorry." Do be aware though that any repeated occurrences of whatever event made this step necessary means that you need to increase your Perceived Responsibility score. The resulting increase in your apology factor score may require you to ramp up to the next level of your personal apology action strategy.

If your apology factor came in somewhere between 5 and 10, your advice is to prepare some remarks to deliver with sincerity. To get you started, a tool you might find useful is Mark's Apology Note Generator.

The trick though is to deliver the words with sincerity, so at the very least, you might need to rewrite your apology statement to at least sound like something you might say, taking care not to go too far and say something too much like you would say, and thereby make matters worse.

Remember, an apology requires you to break from your usual behavior to acknowledge another individual's anger/injury/etc. You don't want to throw more fuel on that fire. Apologies aren't natural, so they shouldn't sound you're going about your usual business!

And then, there are those of you who have earned an apology factor greater than 10. For you, it's more a matter of how far you've blown past this threshold. Consider the following list as a general guide to what you may need to include for your all out apology:

  1. A highly effective apology
  2. Flowers
  3. Chocolates
  4. Cleaning things that aren't dirty.
  5. Tickets for two to something you would never go see of your own free will.
  6. ???

Basically, if your personal apology factor is way higher than 10, you need to do it all, and soon!

Acknowledgments

The image in this post showing the levels of effective apology came from A.J. Meier's Conflict and the Power of Apologies.

Another interesting resource for how to apologize is available at wikihow, which also offers some unique how-to articles in this area, including: how to apologize, how to apologize effectively, and how to apologize for cheating on your partner.

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August 27, 2007

Some things just demand a picture to illustrate. The Tax Foundation's recent computation of the change in progressivity of U.S. income taxes from 2000 to 2005 is one of them:

How the Progressivity of U.S. Income Taxes Changed from 2000 to 2005

The data presented in the chart above includes the contributions of the refundable portions of the Earned Income Tax Credit and the Additional Child Tax Credit. These factors, along with lower tax rates, are a large reason why the tax share decreased substantially for those making less than $25,000 in 2005, as the average tax share for those at these adjusted gross incomes moved to where they receive substantially more in tax credits than they pay in income taxes.

We'll observe that our estimate of the poverty threshold for a married couple with two children in 2005 is $19,723, less than the crossover to positive taxation levels of just over $25,000 for that year.

The chart visually confirms Gerald Prante's observation "that the amount of progressivity within the federal individual income tax system increased from 2000 to 2005, even though income inequality increased slightly."

On that count, slightly is correct. The Gini coefficient, perhaps the best measure of income inequality within a nation, rose by 0.007 for the United States between 2000 and 2005, from 0.462 to 0.469. By contrast, in the decade of the 1990s, it rose from a level of 0.428 in 1990 to 0.462 in 2000, marking a significant increase in income inequality within the U.S. for those years.

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August 24, 2007

Carnival Midway from The Jerk Welcome to the Friday, August 24, 2007 edition of On the Moneyed Midways, the web's only collection of the best posts from this past week's editions the world of business and money-related blog carnivals!

We spent some time last week wondering of the Carnival of Real Estate had committed hari kiri, but it turns out it was only resting. It's back this week and actually contributed two posts to what was a very slow week for the world of money-related blog carnivals! And we've also featured a post from the Odysseus Medal, which is being developed as a strong, on-topic alternative to the CoRE.

Slow is the right word for the past week, as perhaps the heat of late summer perhaps created a situation where a lot of blog carnivals were on pure autopilot. A good example of this occurred with one of our regular favorites, the Festival of Stocks, where this post pretty much proves that the Fully Stocked blog's Maria Palma didn't even bother to read the posts contributed (Gotta love editors who don't edit. We think Maria has a real future in legacy media, perhaps even at the New Republic!)

Even Brian C. Fleming does a better job (and to be honest, he has much improved his Personal Development Carnival by at least screening out the off-topic and occasionally picking out what he believes to be the top posts.)

We still stand by our assertion that any blog hosting a carnival with the word "Lowdown" in its title is one to be avoided.

And now to business! The best posts of the week that was await you below....

On the Moneyed Midways for August 24, 2007
Carnival Post Blog Comments
Bootstrapping Entrepreneurs Going to the Top Too Fast Reflections of a BizDrivenLife Wilson Ng wonders if climbing up the corporate ladder quickly is really such a good idea.
Carnival of Real Estate How to Generate leads from Your Real Estate Blog: We Have Proof RSS Pieces We liked this post since it can apply to a lot more than just real estate. If you're looking to generate business from blogging, the REBlogGirl offers some good advice.
Carnival of Real Estate Beyond Home Buying: How Building and Renovating Can Be the Biggest Investments of Your Life Digerati Life The most fun post of the week! If you ever wanted to see what your home might look like if it were remodeled to resemble the starship Enterprise, the Silicon Valley Blogger shows you (plus nine things to consider when remodeling!)
Carnival of Small Business Issues Let's Talk About Hard Work, Shall We? Create a Thriving Business Jenn Givler rants about what's wrong with those Internet marketing gurus who only work two hours a day and finds that there isn't a substitute for putting in hard work.
Carnival of the Capitalists Carnival of the Capitalists 8-20-2007 Revenue River We don't often point to a Carnival itself as being Absolutely essential reading, and much of this week's CotC is no different, except for host Scott Allen's invaluable contribution at the end of the post in launching the Hall of Shame for spam bloggers!
Carnival of the Capitalists Mattel and Countrywide Show the Good, Bad and ugly of Crisis Communications Scatterbox Steven Silvers compares the response of both toymaker Mattel and home mortgage lender Countrywide in responding to huge crises in each of their industries. The Best Post of the Week, Anywhere!
Odysseus Medal (Real Estate) Does the Real Estate Industry Need Realtors? Bloodhoundblog Michael Cook asks the question that no Realtor really wants to hear and argues that if Realtors want to be relevant in the future, they need to do something very different from what they're doing today.

Previous Editions

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August 23, 2007

Political Map of Asia, 2006 Last week, we launched our latest series comparing the relative economic outputs of the nations of the world with Africa, so this week, we're turning our focus to Earth's largest, most populous and richest continent, Asia!

Once again, we've provided a dynamic ranking table to show each of the continent's countries' Gross Domestic Product (GDP) adjusted for Purchasing Power Parity (PPP), their population and GDP-PPP per Capita for 2006. As we did last week, we'll also determine each country's annualized rate of growth of their GDP-PPP per capita since 2004.

Perhaps the major change in this edition of our Asia edition is that we have not included the West Bank or Gaza since we don't have any reliable population or GDP data for either for 2006. We'll also note that we're missing 2006 GDP data for Afghanistan, Bhutan, East Timor, Macau and the Maldives, which we believe may account their low or negative annualized GDP-PPP per capita growth rates since 2004. If we find updated information for any of these countries, we'll update the table accordingly.

You may sort the data in our dynamic table below by clicking any of the column headings. Doing so will sort the data in the table from low to high value or from high to low (by clicking a column heading a second time.) To restore the original order, you'll need to refresh the page in your web browser.

We'll have some additional comments after the table. As a teaser, think about this: What do the United Arab Emirates and Azerbaijan have in common?...

Africa GDP-PPP in 2006
Country Population GDP-PPP GDP-PPP per Capita Pop. Est. Date GDP Est. Date % Change GDP-PPP per Capita, Since 2004
Afghanistan 31,056,997 21,500,000,000 692.28 July 2006 est. 2004 est. -4.2%
Armenia 2,976,372 16,940,000,000 5,691.49 July 2006 est. 2006 est. 11.2%
Azerbaijan 7,961,619 59,710,000,000 7,499.73 July 2006 est. 2006 est. 40.2%
Bahrain 698,585 18,020,000,000 25,795. July 2006 est. 2006 est. 15.9%
Bangladesh 147,365,352 336,700,000,000 2,284.8 July 2006 est. 2006 est. 8.2%
Bhutan 2,279,723 2,900,000,000 1,272.08 July 2006 est. 2003 est. -2.1%
Brunei 379,444 9,531,000,000 25,118.33 July 2006 est. 2005 est. 15.8%
Burma 47,382,633 85,200,000,000 1,798.13 July 2006 est. 2006 est. 1.7%
Cambodia 13,881,427 37,730,000,000 2,718.02 July 2006 est. 2006 est. 16.0%
China 1,313,973,713 10,170,000,000,000 7,739.88 July 2006 est. 2006 est. 17.7%
East Timor 1,062,777 370,000,000 348.14 July 2006 est. 2004 est. -2.1%
Hong Kong (China) 6,940,432 258,800,000,000 37,288.75 July 2006 est. 2006 est. 4.4%
India 1,095,351,995 4,156,000,000,000 3,794.21 July 2006 est. 2006 est. 10.3%
Indonesia 245,452,739 948,300,000,000 3,863.47 July 2006 est. 2006 est. 5.5%
Iran 68,688,433 599,200,000,000 8,723.45 July 2006 est. 2006 est. 7.9%
Iraq 26,783,383 87,900,000,000 3,281.89 July 2006 est. 2006 est. 23.7%
Israel 6,352,117 170,300,000,000 26,809.96 July 2006 est. 2006 est. 13.5%
Japan 127,463,611 4,218,000,000,000 33,091.8 July 2006 est. 2006 est. 6.1%
Jordan 5,906,760 30,000,000,000 5,078.93 July 2006 est. 2006 est. 5.7%
Kazakhstan 15,233,244 143,100,000,000 9,393.93 July 2006 est. 2006 est. 9.6%
Korea, North 23,113,019 40,000,000,000 1,730.63 July 2006 est. 2006 est. -0.9%
Korea, South 48,846,823 1,196,000,000,000 24,484.7 July 2006 est. 2006 est. 13.4%
Kuwait 2,418,393 55,910,000,000 23,118.66 July 2006 est. 2006 est. 4.3%
Kyrgyzstan 5,213,898 10,730,000,000 2,057.96 July 2006 est. 2006 est. 10.9%
Laos 6,368,481 13,630,000,000 2,140.23 July 2006 est. 2006 est. 7.3%
Lebanon 3,874,050 22,020,000,000 5,683.97 July 2006 est. 2006 est. 6.8%
Macau (China) 453,125 10,000,000,000 22,068.97 July 2006 est. 2004 est. 3.9%
Malaysia 24,385,858 313,800,000,000 12,868.11 July 2006 est. 2006 est. 14.9%
Maldives 359,008 1,250,000,000 3,481.82 July 2006 est. 2002 est. -2.8%
Mongolia 2,832,224 5,852,000,000 2,066.22 July 2006 est. 2006 est. 3.3%
Nepal 28,287,147 41,180,000,000 1,455.78 July 2006 est. 2006 est. -0.1%
Oman 3,102,229 44,530,000,000 14,354.19 July 2006 est. 2006 est. 4.6%
Pakistan 165,803,560 437,500,000,000 2,638.66 July 2006 est. 2006 est. 10.0%
Philippines 89,468,677 449,800,000,000 5,027.46 July 2006 est. 2006 est. 0.3%
Qatar 885,359 26,370,000,000 29,784.53 July 2006 est. 2006 est. 13.3%
Russia 142,893,540 1,746,000,000,000 12,218.89 July 2006 est. 2006 est. 11.7%
Saudi Arabia 27,019,731 366,200,000,000 13,553.06 July 2006 est. 2006 est. 6.2%
Singapore 4,492,150 141,200,000,000 31,432.61 July 2006 est. 2006 est. 6.4%
Sri Lanka 20,222,240 95,550,000,000 4,725. July 2006 est. 2006 est. 8.0%
Syria 18,881,361 77,660,000,000 4,113.05 July 2006 est. 2006 est. 10.7%
Taiwan (China) 23,036,087 680,500,000,000 29,540.61 July 2006 est. 2006 est. 8.0%
Tajikistan 7,320,815 9,521,000,000 1,300.54 July 2006 est. 2006 est. 7.1%
Thailand 64,631,595 596,500,000,000 9,229.23 July 2006 est. 2006 est. 6.9%
Turkey 70,413,958 635,600,000,000 9,026.62 July 2006 est. 2006 est. 10.6%
Turkmenistan 5,042,920 42,840,000,000 8,495.08 July 2006 est. 2006 est. 22.3%
United Arab Emirates 2,602,713 129,500,000,000 49,755.77 July 2006 est. 2006 est. 40.4%
Uzbekistan 27,307,134 55,750,000,000 2,041.59 July 2006 est. 2006 est. 6.4%
Vietnam 84,402,966 262,800,000,000 3,113.63 July 2006 est. 2006 est. 6.4%
Yemen 21,456,188 20,630,000,000 961.49 July 2006 est. 2006 est. 8.9%
Asia (All) 4,096,215,854 28,909,678,000,000 7,057.65 July 2006 2006 13.4%

Azerbaijan and the United Arab Emirates

The answer to our riddle above has two parts: oil and globalization! Both nations have seen their GDP-PPP per capita grow at an annual rates of more than 40%, the highest for the entire Asian continent, largely due to the large amount of revenue realized through the increased production and price for crude oil and their connections with international markets.

Like Equatorial Guinea, Azerbaijan's oil wealth lay mostly untapped until the late 1990s. Here, massive investments from Western oil companies were directed toward developing the nation's oil production infrastructure and constructing a pipeline to connect the nation's oil production through Turkey to international markets in the west.

But, newly developed oil production capability doesn't explain the United Arab Emirates' growth. When similar growth is not observed for other established oil-rich nations such as Bahrain, Brunei, Iran, Kuwait, Russia, Saudi Arabia and excluding Iraq, which is still rebounding following the lifting of economic sanctions, despite rising crude oil prices, something else must be at work.

That something else is the UAE's economic diversification compared to its oil-producing brethren in the global economy. The nation is emerging as one of the world's major financial centers, which has allowed it to significantly outpace the growth of these other nations as its economy features strong liquidity and inexpensive credit to drive internal investments.

Sources and Acknowledgements:

Previously on Political Calculations

2006 Economic and Population Data

2004 Economic and Population Data

2002 Economic and Population Data

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August 22, 2007

Bear Recently, with the stock markets churning out major volatility of the kind we haven't seen February 2003, we noticed that we were getting quite a few posts from people searching for the worst months ever to have been invested in the stock market.

That's only natural that they found us through Google since we've put the entire history of the S&P 500 at your fingertips and that we've also taken the time to map out the worst rates of return ever obtained by the index and have actually built a "what if" tool that answers the question of what would happen if you had those worst-case rates of return.

But, as it turns out, we can't precisely answer that question with our S&P 500 data. Here's why. In doing all this previous analysis, we've used data that is derived from taking the average of the closing value of the S&P 500 index on every trading day during the course of a calendar month. This monthly average works well for generally describing where the S&P 500 was during that monthlong period, but it doesn't tell you what value it started out at, what highs or lows it may have hit, how long it was at any given level, or where it ended.

What we can do however is find the difference between the average monthly value of the index between any two months, even just one month apart.

So, that's what we've done! We scanned our average monthly data to find the five worst roughly monthlong investing periods captured by our data, which we've summarized in the table below:

The Five Worst Months for the S&P 500 Index Value
Starting Month Ending Month Starting Index Value Ending Index Value Percentage Drop
March 1932 April 1932 8.26 6.28 -24.0
November 1931 December 1931 10.39 8.44 -18.8
August 1931 September 1931 13.90 11.83 -14.9
September 1937 October 1937 14.37 12.28 -14.5
August 1937 September 1937 16.74 14.37 -14.2

The ranking of the data in the table above is based upon the percentage change in the average price per share of the S&P 500 stock market index between the indicated two months and does not incorporate inflation, dividend reinvestment, transaction fees, commissions or taxes.

Each of the five worst months for the stock market anticipated some of the worst parts of the Great Depression in the United States. The period from August 1931 through April 1932, which accounts for the top three of the worst monthlong periods ever, spans the stock market's reaction to the second wave of bank failures that began in this time period, along with tax increases passed in this time by the Hoover administration and the Federal Reserve's money tightening policies. The S&P 500 didn't hit bottom until June 1932, the month that ends most of the worst investing periods in U.S. history.

The fourth and fifth worst stock investing period ever coincides with a recession that began in the middle of the Great Depression beginning in mid-1937. This recession was largely driven by the Federal Reserve's decision to tighten the money supply by raising reserve requirements for banks in response to a perceived liquidity trap.

So, there you have it, Google searchers! The five worst months to have been a stock market investor in the S&P 500 of all time. At least, going by what we can extract from the data we have!

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August 21, 2007

"How much slack is there in the labor market?" That's the question King Banaian asked recently in considering recent employment data and for which he provided everything but a tool for estimating the natural rate of unemployment for the United States.

Not being labor slackers here at Political Calculations, we went straight to work to make that tool! You'll find it below, using default data for June 2007, just after the links to the relevant U.S. Bureau of Labor Statistics data reports, which are automatically updated with the most recent editions, from which you'll need to extract the indicated data:

Employment Situation (EMPSIT)

This report is produced monthly and contains the number of employed and the number of unemployed for the total U.S. civilian workforce. The appropriate data is found in Table A-1 in the data section of the report.

Job Openings and Labor Turnover (JOLTS)

This report is produced quarterly and provides the numbers of those newly hired or who have recently separated from their previous employment in the civilian workforce. This data is found in Table A of the main body of the report.

For the best results, all data should be for the same month.

BLS Employment Situation Table A-1 Data
Input Data Values
Total, Civilian Labor Force, Employed (thousands)
Total, Civilian Labor Force, Unemployed (thousands)
BLS Job Overview and Labor Turnover Table A Data
Total Hires (thousands)
Total Job Separations (thousands)


Natural Rate of Unemployment Results
Calculated Results Values
Ratio of New Hires to Number of Unemployed (%)
Ratio of Job Separations to Number of Employed (%)
Natural Rate of Unemployment (%)
Official Unemployment Rate (%)
How much slack is there in the labor market?

In the tool above, the labor market is considered to be overheating when the official rate of unemployment is below the natural rate of unemployment.

The question of how much labor market "slack" might be represented by the difference between the official and natural rates of unemployment is a good one. We've arbitrarily set the tool up to say that there's not much slack if there's only a difference of 0.5% between the two rates, but that may be too high or too low. We're open to suggestions for where to set that threshold.


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August 20, 2007

Since we last looked at the Federal Reserve's actions, the Fed injected well over 38 billion USD of liquidity into the economy to ensure that credit markets would not dry up for a lack of money. We thought we'd look at what that means for the probability of recession in the United States.

The chart below shows what happened last week to the U.S. Treasury Yield Curve:

U.S. Treasury Yield Curve, 13 August 2007 to 17 August 2007

The chart above shows that a major reversion has taken place. On Monday, prior to the Fed's actions of last week, the yield curve was essentially flat, with just 0.04% difference between the 10-Year and the 3-Month Treasuries. However, by Friday, the market's reaction to the Fed's moves greatly reduced the yield of the short term Treasuries. This change sharply reduced the probability of recession occurring in the U.S over the next 12 months, as can be seen by its retreat away from the 50% probability level in our chart for visualizing the probability of recession:

Probability of Recession Snapshots, 13 August 2007 and 17 August 2007

The chart above shows the daily snapshots for Monday, August 13 and Friday, August 17, 2007 given the values of the 3-Month, 10-Year and Federal Funds Rate for those days, rather than the 1-quarter rolling average of each. We find that the probability of recession occurring in the next 12 months from these daily snapshots plummeted from 34% to 15% from Monday to Friday.

We expect that the markets have a lot of shaking out to do still before the yield curve settles down, and there is also an increased likelihood that the Fed may lower the Federal Funds Rate, which will also affect the actual probability of recession.

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August 17, 2007

Carnival Midway from The Jerk Welcome to the Friday, August 17, 2007 edition of On the Moneyed Midways, the only weekly review of the best posts from the most recent editions of the best of the world of business and money-related blog carnivals!

Something happened to the Carnival of Real Estate sometime in the past two weeks, as it appears to have pretty much died. The last edition was posted back on August 6th, but we haven't found any other editions since, nor can we find any future hosts.

Since this particular carnival has produced some of the best posts we've seen this year, we decided to go looking for it. What we found, in effect, is that the carnival pretty much committed suicide following a coup d'etat. From Greg Swann at BloodhoundBlog, who launched the rebellion:

[The Carnival of Real Estate] is up at RealEstateUndressed. Host Larry Cragun got around our having broken the rules on entries by breaking all the rules. In consequence, this week there will be two consumer-focused real estate carnivals and no Carnival of Real Estate.

In a nutshell, the Carnival of Real Estate was intended from the outset to focus on top-notch posts written about the business of real estate itself, rather than the consumer side of the business. Over time, the blog carnival drifted away from its charter, which may have effectively killed it. Greg Swann describes the problem:

I’m pretty fed up with the Carnival of Real Estate. It is what it is, and there have been times over the past year when it has blown tender kisses toward the sublime. But much too often it has chosen to rut around in the mud, and, in any case, it is much too much of everything to be anything at all.

This is not good.

From reading as many blog carnivals as we do, we know that this kind of drift is a spreading problem. In fact, our long-running favorite, the Carnival of the Capitalists, went through something like a re-boot earlier this year to specifically address the situation, and it's one of the most broadly-based carnivals in the blogosphere.

At some point, a blog carnival becomes not worth reading simply because it just becomes a collection of links, rather than a well-considered collection that's been assembled with care and attention by the week's host. We can create a collection of links revolving around a common topic using a search engine. We don't need an actual person to do it if they're not going to exercise any discipline or editorial judgment, nor if they're not going to provide any indication of why a contributed post has been included or even a description of what it's about in their own words.

So, what to do? Gregg Swann is adapting the solution we adopted when we launched OMM - create a ongoing carnival that's tightly focused on topic, edited consistently by one or just a few people, that features the best posts of the week (in his case, focused on the world of the real estate business.) We've featured the result, the Odysseus Medal Awards for Real Estate Weblogging in place of the Carnival of Real Estate for our edition of OMM this week.

That, and all the best posts we found in the week that was await you below....

On the Moneyed Midways for August 17, 2007
Carnival Post Blog Comments
Blogging About ERISA Carnival Benefits Among Those Issues That Need to Be Addressed Up Front in Sale of a Business Retirement Plan Blog Jerry Kalish identifies the questions that the prospective buyers of a business need to address before committing to the deal.
Carnival of Game Production The Five Best Business Video Games of All Time AllBusiness Tim Devaney observes that you can learn a lot of useful skills from video games and offers a short list of five that can teach you something about the world of business!
Carnival of Money Stories How Money Can Change a Life Money Smart Life Absolutely essential reading that begins by asking "What would you say to a drug dealer who asked to bum a cigarette?"
Carnival of the Capitalists We've All Caught the Detroit Disease Trusted Advisor Charles H. Green believes we've learned the wrong lessons from Detroit. Absolutely essential reading!
Cavalcade of Risk The Bear Turns Global SOX First What had been a problem with subprime home loans in the U.S. has gone global, as Leon Gettler reports on indications that sentiments of future economic performance are growing more gloomy.
Festival of Stocks Dividend Analysis; Citigroup (NYSE: C) Dividends Matter Does the recent carnage among financial and bank stocks represent an opportunity to buy a high dividend-yielding stock at a discount? Average Joe's analysis suggests the answer may be yes.
Odysseus Medal (Real Estate) The Innovator's Dilemma in Real Estate: Beware of That Redfin Swimming Just Below You 3 Oceans Real Estate Kevin Boer not only won the inaugural Odysseus Medal competition, he's written The Best Post of the Week, Anywhere!, in a post about how Redfin's innovation may well redefine the future of the real estate industry.
Small Business Issues Training the Aging Workforce SharpBrains Alvaro Fernandez has been thinking about what it will mean for your business when the baby boomers begin retiring en-masse.

Previous Editions

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August 16, 2007

Political Map of Africa, 2006 It was only last year since we looked at the GDP of countries around the world, but since we did, two years worth of GDP data have been released. So, for the sake of getting caught up, we're skipping 2005 altogether and going straight to 2006!

We'll beginning our annual series of GDP comparisons around the world in Africa, providing a dynamic ranking table to show each of the continent's countries' Gross Domestic Product (GDP) adjusted for Purchasing Power Parity (PPP), their population and GDP-PPP per Capita for 2006. This year however, we're going to go the extra mile and determine each country's annualized rate of growth of their GDP-PPP per capita since 2004.

But before we go further, we should note that all GDP-PPP and GDP-PPP per Capita data is presented in U.S. dollars and is not adjusted for inflation. For example, for those of you watching the deterioration of Zimbabwe's economy, you won't find the negative effects of the country's hyperinflation of its own currency in these figures from 2006.

As we noted, the table below is dynamic - clicking any of the column headings will sort the data in the table from low to high value or from high to low (by clicking a column heading a second time.) To restore the original order, you'll need to refresh the page in your web browser.

Africa GDP-PPP in 2006
Country Population GDP-PPP GDP-PPP per Capita Pop. Est. Date GDP Est. Date % Change GDP-PPP per Capita, Since 2004
Algeria 32,930,091 250,000,000,000 7,591.84 July 2006 2006 7.2%
Angola 12,127,071 53,060,000,000 4,375.34 July 2006 2006 44.0%
Benin 7,862,944 8,989,000,000 1,143.21 July 2006 2006 -0.3%
Botswana 1,639,833 17,940,000,000 10,940.14 July 2006 2006 6.6%
Burkina Faso 13,902,972 18,760,000,000 1,349.35 July 2006 2006 7.9%
Burundi 8,090,068 5,781,000,000 714.58 July 2006 2006 5.5%
Cameroon 17,340,702 42,480,000,000 2,449.73 July 2006 2006 14.2%
Cape Verde 420,979 3,129,000,000 7,432.67 July 2006 2006 126.8%
Central African Republic 4,303,356 4,998,000,000 1,161.42 July 2006 2006 1.2%
Chad 9,944,201 14,980,000,000 1,506.41 July 2006 2006 -4.2%
Comoros 690,948 441,000,000 638.25 July 2006 2002 -2.8%
Congo, Democratic Republic of the 62,660,551 44,440,000,000 709.22 July 2006 2006 -1.6%
Congo, Republic of the 3,702,314 5,099,000,000 1,377.25 July 2006 2006 33.3%
Cote d'Ivoire 17,654,843 29,050,000,000 1,645.44 July 2006 2006 7.3%
Djibouti 486,530 619,000,000 1,272.28 July 2006 2002 -2.0%
Egypt 78,887,007 334,400,000,000 4,238.97 July 2006 2006 1.0%
Equatorial Guinea 540,109 25,690,000,000 47,564.47 July 2006 2005 342.6%
Eritrea 4,786,994 4,471,000,000 933.99 July 2006 2005 0.0%
Ethiopia 74,777,981 74,880,000,000 1,001.36 July 2006 2006 11.3%
Gabon 1,424,906 10,170,000,000 7,137.31 July 2006 2006 10.2%
Gambia, The 1,641,564 3,284,000,000 2,000.53 July 2006 2006 5.2%
Ghana 22,409,572 60,000,000,000 2,677.43 July 2006 2006 7.3%
Guinea 9,690,222 20,160,000,000 2,080.45 July 2006 2006 -0.7%
Guinea-Bissau 1,442,029 1,249,000,000 866.14 July 2006 2006 9.2%
Kenya 34,707,817 41,360,000,000 1,191.66 July 2006 2006 4.9%
Lesotho 2,022,331 5,327,000,000 2,634.09 July 2006 2006 -8.7%
Liberia 3,042,004 2,821,000,000 927.35 July 2006 2006 4.1%
Libya 5,900,754 72,680,000,000 12,317.07 July 2006 2006 36.0%
Madagascar 18,595,469 17,270,000,000 928.72 July 2006 2006 5.7%
Malawi 13,013,926 8,272,000,000 635.63 July 2006 2006 1.1%
Mali 11,716,829 14,770,000,000 1,260.58 July 2006 2006 17.1%
Mauritania 3,177,388 8,124,000,000 2,556.82 July 2006 2006 17.7%
Mauritius 1,240,827 17,000,000,000 13,700.54 July 2006 2006 3.3%
Mayotte 201,234 953,600,000 4,738.76 July 2006 2005 37.4%
Morocco 33,241,259 152,500,000,000 4,587.67 July 2006 2006 4.8%
Mozambique 19,686,505 29,170,000,000 1,481.73 July 2006 2006 9.2%
Namibia 2,044,147 15,440,000,000 7,553.27 July 2006 2006 0.0%
Niger 12,525,094 12,360,000,000 986.82 July 2006 2006 7.4%
Nigeria 131,859,731 191,400,000,000 1,451.54 July 2006 2006 25.9%
Rwanda 8,648,248 13,700,000,000 1,584.14 July 2006 2006 9.9%
Sao Tome and Principe 193,413 214,000,000 1,106.44 July 2006 2003 -3.1%
Senegal 11,987,121 21,540,000,000 1,796.93 July 2006 2006 3.1%
Sierra Leone 6,005,250 5,452,000,000 907.87 July 2006 2006 26.5%
Somalia 8,863,338 5,259,000,000 593.34 July 2006 2006 3.5%
South Africa 44,187,637 587,500,000,000 13,295.57 July 2006 2006 7.5%
Sudan 41,236,378 97,470,000,000 2,363.69 July 2006 2006 10.2%
Swaziland 1,136,334 5,936,000,000 5,223.82 July 2006 2006 0.7%
Tanzania 37,445,392 29,620,000,000 791.02 July 2006 2006 10.5%
Togo 5,548,702 9,271,000,000 1,670.84 July 2006 2006 3.4%
Tunisia 10,175,014 89,740,000,000 8,819.64 July 2006 2006 11.4%
Uganda 28,195,754 52,930,000,000 1,877.23 July 2006 2006 12.2%
Zambia 11,502,010 11,640,000,000 1,012.00 July 2006 2006 6.1%
Zimbabwe 12,236,805 25,360,000,000 2,072.44 July 2006 2006 3.8%
Africa (All) 910,142,549 2,581,043,600,000 2,835.87 July 2006 2006 8.8%

The Most Amazing Story in Africa

In 2004, Equitorial Guinea was just a bit ahead of the middle of the pack in terms of economic output in Africa. By 2006, GDP-PPP per capita in the small nation had soared past all the other continents countries and even past the United States $43,994.82 GDP-PPP per capita figure, as the nation's economic output skyrocketed at a blistering 342% compound annualized rate of growth.

So, how did a nation that most Americans are likely unfamiliar achieve this feat? In one word: oil. With large untapped oil fields just discovered in 1996, the combination of greatly increased oil production within the country and significant increases in worldwide demand (and prices) for the resource has brought enormous wealth to the tiny country.

With much of this explosive growth so new, we believe that Equatorial Guinea will be very interesting to watch as its population begins absorbing this wealth and the country adjusts to its new condition of being, on paper, one of the wealthiest nations in the world.

Sources and Acknowledgements:

Previously on Political Calculations

2004 Economic and Population Data

2002 Economic and Population Data

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