Investing Curiouscatblog

Category: economy

  • Which Currency is the Least Bad?

    I really can’t figure out which currency is something I would want to hold if I had the option. It doesn’t really matter, since I am not going to act on it in a very direct way (maybe if I felt very strongly I would do something but it would probably be pretty limited), but I still keep thinking about this issue out of curiosity.

    The USA dollar seems lousy to me. Huge debt (both government and consumer). Government debt is huge on the books and huge off the books (state and local retirement – and federal medical care [social security is really in much better shape than people think, though it also has issues 30 + years out}).

    The Euro seemed a bit lame 3 years ago. Today it seems crazy to think at least one Euro country won’t default in the next 3 years – and likely more. And if they take steps to avoid that it seems like it is going to make the case for the Euro worse).

    The Japanese Yen is much stronger than makes any sense to me. I think it is mainly because of how lousy all the options are. The huge government debt (worse than almost anywhere) and lousy demographics (and the refusal to deal with demographics with immigration or something) are big problems. The biggest reason for strength is that the individuals have huge savings (when your citizens own the debt it is much less horrible than when others do – especially when you are looking at currency value).

    The Chinese Yuan is the best looking at the economic data. The problem is economic data is questionable for the best cases (looking at the USA, Japan…). China’s economic data is far from transparent. There is also great political and social risk. The current worries of a real estate bubble seems justified to me and China just this week took exactly the wrong action – trying to prop up the bubble (in order to decrease the economic slowdown). I can see either of these cases playing out 10 years from now: It was obvious the Yuan was the strongest currency you are an idiot for not being able to see that or It was obvious China was a bubble with unsustainable policies and likely social upheaval thinking that was anything but a sign to sell the Yuan was foolish.

    Given all this I think I weakly come down on the side that the Yuan is likely to be the strongest.

    The safest play I think is the US dollar (as lousy as it is on an absolute basis the options make it look almost good). It could get clobbered. But that seems less likely than the others getting clobbered.

    Smaller currencies have some promise but they can be swamped by global moves. I really have no idea about the Brazilian Real. That might actually be a really good option. The Australian Dollar and Canadian Dollar may also. But those economies are really small. I don’t trust India: they have many good macro-economic factors but the climate for business leaves far too much to be desired (as does the pace of progress fixing those weaknesses). Many economist like them due to demographic factors. I understand that demographic factors will help, but without systemic reform I question how well India can do (it certainly has the potential to do amazingly well, but they seem to be significantly farther away from reaching their potential compared to many countries).

    The Singapore Dollar seems good on many levels, but the economy is small. I am not really sure about emerging economies, there currencies can get swamped in a hurry. Thailand and Indonesia experienced this recently. Thailand, Indonesia and Malaysia are interesting to me in thinking about what their currencies may experience, I would like to read more on this.

    This is more an intellectual and curiosity exercise than something I see directly tied to my investing strategy. But having clear answers of what I thought reasonable scenarios were for currencies going forward that would factor into my investing decisions. Right now, the confusing this causes me, leads me to favor companies that should be fine whatever happens: Apple, Google, Toyota, Intel (I don’t really like Facebook overall but in this way they fit). Lots of the stocks in my 12 stocks for 10 years portfolio, you might notice.

    Related: Is the Euro Going to Survive in the Long Run? – Why the Dollar is Falling – Strong Singapore Dollar – Warren Buffett Cautions Against Buying Long Term USD Bonds

  • The USA Is Not as Dependent on China Economically as People Think

    3 Economic Misconceptions That Need to Die

    Just 2.7% of personal consumption expenditures go to Chinese-made goods and services. 88.5% of U.S. consumer spending is on American-made goods and services… Walmart’s $260 billion in U.S. revenue isn’t exactly reflective of America’s $14.5 trillion economy. Walmart might sell a broad range of knickknacks, many of which are made in China, but the vast majority of what Americans spend their money on is not knickknacks.
    …
    Just 6.4% of nondurable goods — things like food, clothing and toys — purchased in the U.S. are made in China; 76.2% are made in America. For durable goods — things like cars and furniture — 12% are made in China; 66.6% are made in America.

    Those numbers are significantly less than I expected but the concept matches my understanding – that we greatly underestimate the purchasing of USA goods and services.

    We have an inflated notion of how large the China macro economic numbers are for the USA (both debt and manufacturing exports to us). The China growth in both is still amazingly large: we just overestimate the totals today. We also forget that 25 years ago both numbers (imports from China and USA government debt owned by China) were close to 0.

    We also greatly underestimate how much manufacturing the USA does, as I have been writing about for years. In fact, until 2010, the USA manufactured more than China.

    China owns 7.6% of U.S. government debt outstanding. As of November, China owned $1.13 trillion of Treasuries. Government debt stood at $14.9 trillion that month. That’s 7.6%.

    Who owns the rest? The largest holder of U.S. debt is the federal government itself. Various government trust funds like the Social Security trust fund own about $4.4 trillion worth of Treasury securities. The Federal Reserve owns another $1.6 trillion.

    Ok, this figure is a bit misleading. But even if you thrown out the accounting games 1.13/8.9 = 12.7%. That is a great deal. But it isn’t a majority of the debt or anything remotely close. Other foreign investors own $3.5 trillion trillion in federal debt (Japan $1 trillion, UK $500 billion). The $4.6 trillion of federal debt owned by foreigners is a huge problem. With investors getting paid so little for that debt though it isn’t one now. But it is a huge potential problem. If interest reates increase it will be a huge transfer of wealth from the USA to others.

    Just 9.8% of oil consumed in the U.S. comes from the Middle East. According the U.S. Energy Information Administration, the U.S. consumes 19.2 million barrels of petroleum products per day. Of that amount, a net 49% is produced domestically. The rest is imported.

    The oil figure is a bit less meaningful, I think. Oil import are hugely fungible. The USA cutting back Middle East imports and pushing up imports from Canada, Mexico, Nigeria… doesn’t change the importance of Middle East oil to the USA in reality (the data might seem to suggest that but it is misleading due to the fungible nature of oil trading). Whether we get it directly from the Middle East or not our demand (and imports) creates more demand for Middle East oil. It is true the USA has greatly increased domestic production recently (and actually decreased the use of oil in 2009). So while I believe the data on Middle East oil I think that it is a bit misleading. If we had 0 direct imports from there we would still be greatly dependent on Middle East oil (because if France and China and India… were not getting their oil there they would buy it where we buy ours… Still the USA uses far more oil than any other country and is extremely dependent on imports. Several other countries are also extremely dependent on oil imports, including the next two top oil consuming countries: China, Japan.

    Related: Oil Production by Country 1999-2009 – Government Debt as Percentage of GDP 1990-2009: USA, Japan, Germany, China… – Manufacturing Output as a Percent of GDP by Country – The Relative Economic Position of the USA is Likely to Decline

  • USA Apartment Market in 2011

    The national occupancy climbed 110 basis points during the year, and effective rents jumped 4.7% according MPF Research.

    Occupancy rates increased to 94.6% at the end of 2011, up from 93.5% a year ago and from 91.8% when the occupancy rates bottomed in late 2009.

    MPF Research predicts occupancy rates to increase another 50 basis points, and rents to rise 4.5%.

    Northern California’s apartment markets ranked as the nation’s rent growth leaders during calendar 2011, despite the fact that some weakness registered in the performances recorded in parts of the Pacific Northwest specifically during the fourth quarter. Year-over-year, effective rents for new leases jumped 14.6% in San Francisco, 12.3% in San Jose, and 9% in Oakland. With rents down 0.4%, Las Vegas was the nation’s only major apartment market that lost pricing power during calendar 2011.

    Rent Growth Leaders in Calendar 2011

    Rank Metro Area Annual Rent Growth
    1 San Francisco 14.6%
    2 San Jose 12.3%
    3 Oakland 9.0%
    4 Boston 8.3%
    5 New York 7.3%
    6 Austin 7.2%

    Related: Apartment Vacancies Fall to Lowest in 3 Years in the USA (April 2011) – Top USA Markets for Buying Rental Property – Apartment Rents Rise, Slightly, for First Time in 5 Quarters – It’s Now a Renter’s Market

  • 243,000 Jobs Added in January Bring the USA Unemployment Rate Down to 8.3%

    Total nonfarm payroll employment rose by 243,000 in January, and the unemployment rate decreased to 8.3%, the United States Bureau of Labor Statistics reported today. Job growth was widespread in the private sector (which gained 257,000 jobs in the month), with large employment gains in professional and business services, leisure and hospitality, and manufacturing (which added an impressive 50,000 jobs). The change in total nonfarm payroll employment for November was revised from +100,000 to +157,000, and the change for December was revised from +200,000 to +203,000 which brings the total number of jobs gained with this report to 303,000, a very impressive figure.

    This employment news is really starting to add up to something good. And this is going on while everyone is worrying about the Euro imploding. Quite remarkable really. Avoiding a much worse result from the too big-to-fail-financial-firms credit crisis is surprising. We are not close to through the mess that we created, but that it hasn’t been much worse is fairly amazing. And that things are going so well now (even with large unemployment problems) is impressive. The huge government debt balances are a very large concern but it wouldn’t be surprising to have those same huge debts and much worse present day conditions (which would add to the debts).

    The unemployment rate declined to 8.3%; the rate has fallen by 80 basis point since August. The number of unemployed persons declined to 12.8 million in January. Among the major worker groups, the unemployment rates for adult men (7.7%) and blacks (13.6%) declined in January. The unemployment rates for adult women (7.7%), teenagers (23.2%), whites (7.4%), and Hispanics (10.5%) were little changed. The jobless rate for Asians was 6.7%.

    The number of long-term unemployed (those jobless for 27 weeks or more) was little changed at 5.5 million and accounted for 42.9% of the unemployed. Long term unemployment remains a big problem. With a few more months with such strong growth in jobs and that could start to change.

    After accounting for the annual adjustments to the population controls, the employment-population ratio (58.5%) rose in January, while the civilian labor force participation rate held at 63.7%.

    Professional and business services continued to add jobs in January (+70,000). About half of the increase occurred in employment services (+33,000). Job gains also occurred in accounting and bookkeeping (+13,000) and in architectural and engineering services (+7,000).

    Related: USA Adds 216,00 Jobs in March and the Unemployment Rate Stands at 8.8% (March 2011) – USA Unemployment Rate Remains at 9.7% (Feb 2010) – USA Unemployment Rate Rises to 8.1%, Highest Level Since 1983 (March 2009)

    (more…)

  • USA Spends $7,960 Compared to Around $3,800 for Other Rich Countries on Health Care with No Better Health Results

    The latest data from the commonwealth fund report confirms the status quo. The USA spends twice as much on their health care system for no better results. It is easier to argue the USA is below average in performance that leading. And for double the cost that is inexcusable.

    Globally the rich countries citizens are not tremendously happy with health care systems overall. It seems likely not only does the USA cost twice and much as it should and perform poorly compared to countries doing an excellent job but the USA performs that poorly compared to countries that themselves have quite a bit of improvement to make. Which makes the state of the USA system even worse.

    Data from the Commonwealth fund report published in 2011 with data for 2009, International Profiles of Health Care Systems, 2011:

    Table showing, percent of GDP spent and total spending per capita in USD on health care by country.

    Country 2007 Spending
    		2009 Spending
    Australia 9.5% $3,128 8.7% $3,445
    Canada 9.8% $3,326 11.4% $4,363
    Germany 10.7% $3,287 11.6% $4,218
    Japan 8.5% $2,878
    New Zealand 9.0% $2,343 10.3% $2,983
    UK 8.3% $2,724 9.8% $3,487
    USA 16.0% $6,697 17.4% $7,960
    Survey of population, showing % that chose each statement (no data available for Japan)
    Australia Canada Germany New Zealand UK USA
    2007 – 2010 2007 – 2010 2007 – 2010 2007 – 2010 2007 – 2010 2007 – 2010
    Overall health system views
        Only minor changes needed, system works well 24 – 24 26 – 38 20 – 38 26 – 37 26 – 62 16 – 29
        Fundamental changes needed 55 – 55 60 – 51 51 – 48 56 – 51 57 – 34 48 – 41
        Rebuild completely 18 – 20 12 – 10 28 – 14 17 – 11 15 – 3 34 – 27
    Percent uninsured 0 – 0 0 – 0 <1 – 0 0 – 0 0 – 0 16 – 16

    Under currently law in the USA by 2020 the uninsured rate should decline to under 5% by 2020 (still far more than any rich country – nearly all of which are at 0%).

    On many performance measures in the report the USA is the worst performing system (in addition to costing twice as much). Such as Avoidable Deaths, 2006–07, the USA had 96 per 100,000, the next highest was the UK at 83, Australia was the lowest at 57. And Diabetes Lower Extremity Amputation Rates per 100,000 population, the USA had 36 the next highest was New Zealand at 12, the lowest was the UK at 9. For experiencing a medical, medication or lab test rrror in past 2 years, the USA was at 18%, next worst was Canada at 17%, best was UK at 8%. The USA was top performer in breast cancer five-year survival rate, 2002–2007. And sometimes the USA was in the middle, able to get same/next day appointment when sick: the USA was at 57%, New Zealand achieved 78% while Canada only reached 45%.

    It is possible to argue the USA provides mediocre results, which is consistent with most global health care performance measures. Unless you directly benefit from the current USA system it is hard to see how you can argue it is not the worst system of any rich country. Costing twice as much and achieving middling performance. All that doesn’t even factor in the cost in anguish and bankruptcies and restricting individual freedom (when you have to stay tied to a job you would rather leave, just because of health insurance) caused by the difficulty getting coverage and fighting with the insurance companies for payment and coverage for treatment expenses.

    Related: Measuring the Health of Nations – USA Paying More for Health Care – Traveling for Health Care – resources for improvement health system performance

  • Looking at GDP Growth Per Capita for Selected Countries from 1970 to 2010

    I decided to take a look at some historical economic data to see if some of my beliefs were accurate (largely about how well Singapore has done) and learn a bit more while I was at it.

    GDP in USD for countries

    country
    		1970**
    		2010***
    		% increase
    Korea 1,320 20,200 1,430
    China 325 4,280 1,217
    Singapore 4260 42,650 901
    Indonesia 460 2,960 543
    Brazil 1900 10,500 453
    Thailand 850 4,600 441
    Portugal 3,970 21,000 429
    Japan 9,000 42,300 370
    Malaysia 1,900 7,755 308
    Germany 11,550 40,500 251
    UK 10,400 36,300 249
    France 13,600 40,600 199
    Mexico 4,160 9,200 121
    Panama 3,480 7,700 121
    India 555 1,180 113
    USA 23,350 47,100 102
    South Africa 3,930 7,100 81
    Venezuela 8,280 9,770 18

    I just picked countries that interested me and seemed worth looking at. I looked for some around the starting position of Singapore and close to Singapore geographically. And looked at Panama as the closest match to Singapore (for Singapore’s main 1970 asset, convenient for shipping lanes, and very close for GDP per capita).

    Malaysia and Singapore were 1 country after independence (from 1963-1965).

    I can’t imagine more than a couple countries could reasonably be argued to have had better economic performance from 1970 to 2010 than Singapore (Korea? China? Who else?). Singapore had very little going for it in 1970. They had a good location for shipping and that is about it macro-economically. No natural resources. No huge storage of wealth. No preeminence in science, technology or business.

    It seems to me that Singapore actually did have 1 other thing. A government that was to preside over a fantastic economic growth success. You won’t find many textbooks talking about the way to economic success is a very well run government. And there is good reason for that, I believe. Relying on a very well run government will nearly always fail. In some ways Singapore was like Japan but with significantly more government influence on the way economic development played out.

    I was surprised how poorly the USA has faired. It isn’t so surprising that we lagged. People forget how rich the USA was in 1970. The USA is still very rich but bunched together with lots of other rich countries instead of way out ahead as they were in 1970. And in 1970 the lead was already contracting, for what it had been earlier. But even knowing the relative performance of the USA had lagged, I was surprised by how much it under-performed.

    I was also surprised with India. I knew they have done poorly but I didn’t realize it had been this poor. The failures to greatly improve infrastructure, education and the stifling effect of their bureaucracy have been causing them great harm. They have been doing some good things in the last 10 years especially but still have a long way to go. Their premier education is actually pretty decent. The problem is the other 90% of the education is often poor and many people (especially women) hardly have any education at all. It is very hard to get ahead when you fail to take advantage of the talents of so many of your people.

    Related: Singapore and Iskandar Malaysia – Chart of Largest Petroleum Consuming Countries from 1980 to 2010 – Chart of Nuclear Power Production by Country from 1985-2009 – Top Countries For Renewable Energy Capacity

    (more…)

  • USA Adds 200,000 Jobs in December, Unemployment Rate Falls to 8.5%

    Nonfarm payroll employment rose by 200,000 in December, and the unemployment rate declined to 8.5% (the lowest rate in 3 years), continuing a downward trend. The change in total nonfarm payroll employment for October was revised from +100,000 to +112,000, and the change for November was revised from +120,000 to +100,000 (which results in total increase of 192,000 with this report: 200,000 – 8,000 lost in revisions).

    The number of long-term unemployed (those jobless for 27 weeks or more) continues to be a big problem and was little changed at 5.6 million, accounted for 42.5% of the unemployed (quite a high percentage). While adding 192,000 is better than losing jobs or adding fewer, it is still not enough to make up for the credit crisis job losses. The economy needs to add 125,000 a month to keep up with population growth. Sustained gains over 230,000 month after month are needed to be what I would see as good, and really above 270,000 would be much better – but given the Eurozone problems, staying about 200,000 may really be good news.

    The civilian labor force participation rate (64.0%) and the employment-population ratio (58.5%) were both unchanged over the month.

    Over the past 12 months, nonfarm payroll employment has risen by 1.6 million. Employment in the private sector rose by 212,000 in December and by 1.9 million over the year. Government employment changed little over the month but fell by 280,000 over the year.

    Employment in transportation and warehousing rose sharply in December (+50,000). Almost all of the gain occurred in the couriers and messengers industry (+42,000); seasonal hiring was particularly strong in December.

    Retail trade continued to add jobs in December, with a gain of 28,000. Employment in the industry has increased by 240,000 over the past 12 months.

    In December, manufacturing employment expanded by 23,000, following 4 months of little change. Employment increased in December in transportation equipment (+9,000), fabricated metals (+6,000), and machinery (+5,000).

    Related: USA Unemployment Rate Rises to 9.8% (Nov 2010) – USA Unemployment Rate Remains at 9.7% (March 2010) – Over 500,000 Jobs Disappeared in November 2008

    (more…)

  • Chart of Manufacturing Output from 2000 to 2010 by Country

    chart of manufacturing output by country 2000-2010, for the top 10 manufacturing countries

    Chart of manufacturing production by the top 10 manufacturing countries (2000 to 2010). The chart was created by the Curious Cat Economics Blog. You may use the chart with attribution. All data is shown in 2010 USD (United States Dollar).

     

    In my last post I looked at the output of the top 10 manufacturing countries with a focus on 1980 to 2010. Here I take a closer look at the last 10 years.

    In 2010, China took the lead as the world’s leading manufacturing country from the USA. In 1995 the USA was actually very close to losing the lead to Japan (though you wouldn’t think it looking at the recent data). I believe China will be different, I believe China is going to build on their lead. As I discussed in the last post the data doesn’t support any decline in Chinese manufacturing (or significant moves away from China toward other South-East Asian countries). Indonesia has grown quickly (and have the most manufacturing production, of those discussed), but their total manufacturing output is less than China grew by per year for the last 5 years.

    The four largest countries are pretty solidly in their positions now: the order will likely be China, USA, Japan, Germany for 10 years (or longer): though I could always be surprised. In the last decade China relentlessly moved past the other 3, to move from 4th to 1st. Other than that though, those 3 only strengthened their position against their nearest competitors. Brazil, Korea or India would need to increase production quite rapidly to catch Germany sooner. After the first 4 though the situation is very fluid.

    chart of manufacturing output data by country from 2000-2010 (looking more closely at the 5,6,7... top countries)
    Taking a closure look at the large group of countries after top 4. Chart of manufacturing production from 2000-2010.

    Chart of manufacturing production by the leading manufacturing countries (2000 to 2010). The top 4 countries are left off to look more closely at history of the next group. The chart was created by the Curious Cat Economics Blog based on UN data. You may use the chart with attribution.

     

    Removing the top 4 to take a close look at the data on the other largest manufacturing countries we see that there are many countries bunched together. It is still hard to see, but if you look closely, you can make out that some countries are growing well, for example: Brazil, India and Indonesia. Other countries (most in Europe, as well as Mexico) did not fare well in the last decade.

    The UK had a particularly bad decade, moving from first place in this group (5th in the world) to 5th in this group and likely to be passed by India in 2011. Europe has 4 countries in this list (if you exclude Russia) and they do not appear likely to do particularly well in the next decade, in my opinion. I would certainly expect Brazil, India, Korea and Indonesia to out produce Italy, France, UK and Spain in 2020. In 2010 the total was $976 billion by the European 4 to $961 billion by the non-European 4. In 2000 it was $718 billion for the European 4 to $343 billion (remember all the data is in 2010 USD).

    (more…)

  • Top 10 Countries for Manufacturing Production in 2010: China, USA, Japan, Germany…

    chart of output by top 10 manufacturing countries from 1980 to 2010

    Chart of output by top 10 manufacturing countries from 1980 to 2010. The chart was created by the Curious Cat Economics Blog based on UN data. You may use the chart with attribution.

     

    China has finally actually taken the lead as the largest manufacturer in the world. Reading many news sources and blogs you may have thought the USA lost the lead a couple of decades ago, but you would be wrong. In 1995 it looked like Japan was poised to take the lead in manufacturing production, but they have slumped since then (still they are solidly the 3rd biggest manufacturer). China has been growing manufacturing output enormously for 20 years, and they have now taken the lead from the USA.

    As I have been saying for years the biggest economic story about manufacturing is the dramatic and long term increase of productive capacity in China. The next is the continuing global decline in manufacturing employment: increased productivity has seen production rise year after year and employment fall. What is the next most interesting stories is debatable: I would say the continuing failure to appreciate the continuing strong manufacturing production increases by the USA. Another candidate is the the decline in Japan. Another is the increase in several other counties: Korea, Brazil, India, Indonesia…

    Looking more closely at some of the long term data shows how much China stands out. From 1980 to 2010 China increased output 1345%. The total top 10 group increased output 302% (all data is in current USD so inflation accounts for most of the gain, 100 1980-USD equal 280 2010-USD). From 1995 to 2010 China increased output 543%. The group increased 64%. For 1980-2010, the results for the other 3 largest manufacturing countries are: USA up 218%, Japan up 261% and Germany up 148% (other countries doing very well are Korea up 1893% and India up 737%). Looking at the last half of that period, from 1995-2010 the: USA up 44%, Japan down 11% and Germany up 19%.

    One thing to remember about adjusting manufacturing data for inflation is that often the products created in later years are superior and cost less. So that a computer manufactured in 1990 which added $5,000 to the manufacturing total is far inferior to one in 2010 that added just $1,000. This point is mainly to say that while the increase in manufacturing in real (not inflated dollars) is not as high as it might seem the real value of manufacturing good did likely increase a great deal. But the economic data is based on price so manufacturing increases are reduced by cost decreases. Computers are the most obvious example, but it is also true with many other manufactured goods.

    You can that the other largest manufacturing countries fail to keep up with the increases of the entire group of the top 10. China’s gains are just too large for others to match. If you remove China’s results (just to compare how the non-China countries are doing) from 1980-2010 the increase was 216% (so compared to the other 9 top manufacturers over this period the USA was even and Japan better than the average and Germany was worse). And from 1995-2010 the top 9 group (top 10, less China) increased just 28%: so the USA beat while Japan and Germany did worse than the other 9 as a group.

    (more…)

  • Relocating to Another Country

    There is an increasing trend to move from the USA to another country to work and live. This is not surprising to me. Recently this has picked up quite a bit; I am surprised by the velocity at which this interest in moving (I figured it would be a long term mega trend but not so drastic, so quickly). Economic changes are often quite surprising in how rapidly they move forward.

    An interesting survey shows USA investors have become much more interested in relocating in the last two years (the data they show though has tremendous volatility over time, so I am not really sure this means much). I wonder how much of it can be explained by investors wanting to get a deep understanding of very promising markets. I wouldn’t image the actual number that do this is huge, but maybe the number considering it is significant. Billionaire investor, Jim Rodgers moved to Asia because he sees Asia as key to the future. One of the reasons I moved to Malaysia this year was to get a in depth understanding of what South East Asia is like (it is not a deciding reason, at all but maybe the 4th or 5th reason).

    I believe the globalization of the employment market is a long term trend that will continue – especially for “knowledge workers.” The USA rested on the post WW II economic domination for nearly 50 years. The policies also helped this continue: investing in science and engineering, favoring entrepreneurship… But other countries have realized the value of these things (and the USA is slipping – not investing nearly as much in science and engineering and favoring large corporations that give politicians large amounts of cash over innovation – see things like the incredibly outdated “intellectual property” system, SOPA, favoring huge financial institutions…

    The combination of long term policy weakness, the inevitable decline in the USA to world ratio of economic wealth, and the financial crisis caused by the policy weaknesses have seemingly greatly accelerated the trend. The next 2 or 3 years will determine if that is a permanent acceleration or if we go back to a slower pace – but on the same path. My guess is that we will stay on this path but the pace will not follow the level surveys might indicate (showing interest in such a big change is far different from actually moving).

    There don’t seem to be any decent estimates of Americans living abroad. The US State Department claims releasing their estimates would be a national security risk? And the Census bureau says it would cost too much to try. Wild guesses seem to be between 4 and 6 million.

    Related: I want out (subreddit) – Why Investing is Safer Overseas – USA Heath Care System Needs Reform – Copywrong