2016 populyst Index™ First Quartile Demographic Scores

In constructing the populyst Index™, we use multiple sources to arrive at a rating for two of the index’s three pillars: Innovation & Productivity and Society & Governance. However our Demographics rating is developed by populyst. The score ranges from -2 to +2.

Countries of the West and of the former Soviet bloc all rate at or below zero. As is well publicized, Japan, Germany and Russia are some of the major countries in this group that have the most challenging demographics, defined as a declining population and rising dependency ratio. See also America Without Immigration and Would Reaganomics Work Today?

Countries of the Middle East and North Africa have more dynamic population growth. With some exceptions, their demographics are strong and their populations are young. But their economies in general seem ill prepared to absorb the large increase in people seeking employment. See also MENA Economies: Trouble Ahead. Continue reading

Posted in Africa, Demography, Dependency Ratio, Economy, Europe, Innovation, Middle East, populyst Index, Society, Sub-Saharan, United States | Leave a comment

Sweden Tops populyst Index™ Ranking

The idea of the populyst index™ is that there are three main vectors of wealth creation in any economy: Innovation & Productivity, Demographics & Health, and Society & Governance.

Innovation & Productivity encompasses education, infrastructure and the creation of intellectual property assets. Demographics & Health includes population growth, the age profile of the population and health metrics such as child mortality. Society & Governance relates to the economic context, the level of corruption, the amount of competition, the ease of doing business and  access to capital markets. Continue reading

Posted in Demography, Economy, Innovation, populyst Index, Society, Sweden | Leave a comment

America Without Immigration 2015-50

Be careful what you wish for, if that is what you wish for.

Except for the oil shocks of the 1970s and a few other recessionary years, the US economy has generally been strong in the postwar era since 1945. Huge advances in technology and trade, a favorable business environment and strong demographics combined to create tens of trillions of dollars of new wealth in the US and around the world.

The demographic component played an important supporting role. During the baby boom years, the number of Americans grew at an average annualized rate of 1.6% (see chart). In subsequent years starting in the mid 1960s, this growth faded to about 1% where it remained until 2007-08. Since then, it has fallen to 0.7% and, on current UN projections, it will continue to fall through 2050 when it may dip under 0.4%. Continue reading

Posted in Demography, Dependency Ratio, Economy, Immigration, United States, US Economy | Leave a comment

So You Want a Revolution

You say you want a revolution
Well you know
We’d all want to change the world.____ The Beatles (1968)

Apparently not. Not any more. Not everyone wants to change the world. To the Beatles in 1968, when young people aged less than 30 added up to 52% of the US population, it might have looked like everyone wanted a revolution and that a nascent movement had a deep reserve of younger cohorts ready to push for change. But the percentage of the population aged less than 30 today is only 39% and falling. If 39% vs. 52% does not look like a big difference, consider that 13% of the US population is equivalent to 42 million additional young people who would be among us, if the percentage was the same as in 1968. A quarter to a third (10 to 14 million) would be in their 20s. Continue reading

Posted in 2016 Candidates, Demography, Economy, Europe, Iran, Middle East, Society, Turkey, United States | Leave a comment

Talking about populyst and the populyst Index

Aaron M. Renn, a senior fellow at the Manhattan Institute and a contributing editor at City Journal, invited founder Sami J. Karam to discuss populyst and the populyst index. Topics include the economies of America and China, Europe’s demographic stagnation and Africa’s population explosion.

TO HEAR THE PODCAST, CLICK HERE OR ON THE TIMELINE BELOW:

Posted in Africa, BRIC countries, China, Demography, Dependency Ratio, Economy, Emerging Markets, Europe, Germany, India, Innovation, Japan, Podcast, Society, Sub-Saharan, United States | Leave a comment

Learning from Medellín with Alejandro Echeverri

“I think, if you want to write a new narrative at some specific moment in the story of a city, it is important that you have to feel the transformation and see the transformation. So the physical transformation is important but always there is more a spiritual thing, as happens with emotional connections and inspirational things.” ______Architect Alejandro Echeverri.

EcheverriPhotoIf you have an interest in Latin America or in urban matters, you will have read by now that the city of Medellín, Colombia has undergone a startling transformation in the past fifteen years. In the 1980s and 1990s, the name of Medellín evoked fearsome drug cartels, violence and terrorism.

But in the 2000s, Medellín took a dramatic turn for the better. In 2012, it was selected from 200 contenders as Innovative City of the Year in a survey organized by the Wall Street Journal and the Urban Land Institute. Today, it features regularly among lists of forward-looking cities and must-see destinations. Continue reading

Posted in Cities, Colombia, Economy, Infrastructure, Innovation, Investment, Latin America, Medellin, Podcast, Society, Urban Planning, Urbanization | Leave a comment

Microsoft-LinkedIn: Little Room for Error

The price paid by Microsoft assumes a trebling of revenues and strong cash flow at LinkedIn.

12191610_10206791592941545_391417102854323559_n (2)Microsoft’s annual unlevered free cash flow is now around $20 billion, which means that its enterprise value of $300 billion is about 15x unlevered FCF. Because Microsoft’s revenues are not growing and LinkedIn’s are growing rapidly, let’s assume a 30x multiple to derive LinkedIn’s FCF as implied by the enterprise value paid by Microsoft in the takeover. With an EV of $26.2 billion, LinkedIn would need an FCF run rate of at least $870 million post deal to justify the price paid. Continue reading

Posted in Economy, Innovation, Investment, Microsoft, Stock Market, United States, Wall Street | Leave a comment

Talking About Brexit with Andrew Stuttaford

“So far as the original founders are concerned, the journey [of European integration] continues. The problem is it is not what most British people thought they were signing up for.” ____Andrew Stuttaford.

Screen Shot 2016-06-19 at 6.15.53 AMAndrew Stuttaford is a British-born contributing editor at National Review and a frequent writer on British and European topics. In recent months, he has been an advocate of ‘Brexit’, the United Kingdom leaving the European Union. A few days before the June 23rd referendum, Stuttaford explains the factors that made him increasingly wary of further European integration. Continue reading

Posted in Economy, England, Europe, European Union, Podcast, Politics, Scotland, Society, United Kingdom | Leave a comment

Gold: The Barbarian Tries a Comeback

New doubts about the effectiveness of government are boosting the price of gold again.

Last fall, around the time we updated our comment on the ratio of Gold to the S&P 500, the price of gold fell to a six-year low of $1,049 per ounce, representing a decline of 45% from the September 2011 peak of $1,895. As is customary near the end of each year since 2011, there were at the time several bearish analyses, assuring us in this case that the next level would be below $1,000. But gold was recently near $1,300, having risen over 15% since January 1st. Continue reading

Posted in Economy, Gold, Investment, US Economy | Leave a comment

The Way Forward for Hedge Funds – 2

In the first installment, I made a case that hedge funds can regain their popularity by reverting to their initial mandate which was to be hedged. I examine here how such a model hedge fund would have performed in the past 50 years if it had returned:

  • 0% in all years when the market was down.
  • 75% of the market gain in all years when the market was up.

In essence, this fund only has a chance of outperforming the S&P 500 in the long run if the market has a big down year (say 10%+) every few years.

So what do the past 50 years tell us? Continue reading

Posted in Economy, Hedge Funds, Innovation, Investment, Stock Market, United States, Wall Street | Leave a comment