Category: Money & Wealth
Most people don’t think much about economic freedom and that some countries are more free economically than others.
For the 18th year running, Hong Kong scores the highest rankings of any country in the world for:
- rule of law
- regulatory efficiency
- limited government
- open markets
And to point out the obvious…. Hong Kong is part of China! Check out the announcement: click here
OK, so there is a lot of doom and gloom predictions that the world is turning to ^&%$! if you track history (which has a habit of repeating) you will know that these predictions have been the same for many generations… and yet, the world we live in today is way, way better than the world of our parents.
Just look at what we can do in terms of travel, building wealth, communications, entertainment etc. etc.
I came across the below chart from the White House… yes, sure, its political… however, I do think it tells a story looking back that things have stabilized and are now improving. US economic growth is on an upswing.
As the US Govt. Debt discussions have occupied a lot of media attention over the past weeks, I notice that there has been a lot of inaccurate facts and figures circulating around the internet. Many people believe that the Chinese Govt. owns most of the debt, when in fact it only owns 7.5% of the total.
This years Global Competitiveness Index tells an interesting story… the US is sliding down the rankings, Switzerland maintains its lead and Sweden is on the way up. Singapore goes sideways. Having said that ranked 3rd in the world is not a bad place to be! There are many factors that drive productivity and competitiveness. Understanding the various factors is a very interesting process… and if you are an investor and/or entrepreneur, where would you establish a new business? (ie: its easier to do business in countries at the top of the list)
As we consider 2011 and what direction the future will take, it is useful to look at the world as a whole and remember that the world we live in today gives us very useful clues as to how the world of tomorrow will look.
Population size and growth are not the only factors to consider, however, they give you a very good idea of where things are headed.
Consider the below chart that shows that 50% of today’s world population lives in just six countries! Wow, only six countries! Clearly, the USA is the most developed of the six – and the others have a long way to go in terms of development – to catch up. This adds up to lots of growth… check it out for yourself:
This is an interesting video demonstration of a roller coaster track based on the Dow Jones Industrial Average from October 2007 to March 2009.
This chart shows real GDP growth from 1960 to 2006. The current economic crisis has dramatically impacted the current growth rates and has resulted in significant contraction. The relevance of this chart is seeing where the growth has been in the past in order to look into the future and see where growth will pick up and gain momentum as we enter an economic recovery period.
Viewing this chart reflects the following:
- The Euro Area has been on a long-term decline in growth. Entrepreneurship is stifled. What are the Europeans going to do to reverse this situation? How will they compete with North America and Asia?
- The US has consistently generated higher growth rates than the Euro Area, however, growth has slowed too. Big Government and higher taxes are going to limit growth and inhibit entrepreneurship.
- Latin America reflects a classic V curve. Plenty of room for future growth.
- Another classic V curve. Middle East hit hard by the decline in Crude Oil prices and the US losses of their Sovereign Wealth Funds.
- V curve with significant contraction at the bottom of the V.
- South Asia shows minor contraction followed by significant growth.
- Significant growth in East Asia & Pacific.
Bottom line? South East Asia & Pacific as a region – including China, India, and Japan – looks set for sustained growth in the long term.