Tuesday, July 01, 2008

Economic hardening of the arteries 

A few weeks back the U.S. newscaster Tim Russert died suddenly. When I mentioned this to a friend he seemed nonplussed. Not that I care about Russert particularly but I asked my friend how he could seem so unsurprised and indifferent to the sudden death of a fairly well known persona. His reply? "He was a fat, out of shape slob. Of course he had a heart attack".

Can't argue with that one. Personally, given how fat and out of shape he was I was surprised that Russert's doctors didn't do more to avert what had to be a very obvious danger.

Thing is, just as people sometimes get flabby and out of shape so too do economies. In fact, economies should probably be looked at every so often to see if they seem to be "at risk" for a major adverse event and if so, well, maybe they should consider doing something about that.

To that end, I thought it might be helpful to look at some economic data from one particular country to see if we might be see from basic data whether the economy seems to be healthy and well balanced, or if it seems to drifting into a danger zone. Before I present the data I want to be clear that I am not out to put on the spot or embarrass any one particular country so the country whose data this is shall remain nameless:

Lets see, imports up over 120%, consumption up over 70%, manufacturing up 24%, agriculture up 8%, and non-oil exports down 3.6%.

I don't know: if you went to your doctor and your waistline, good cholesterol, and bad cholesterol numbers where this far out of whack what do you think they'd say?

And a final point, I have no idea where that country is getting all the money to have imports and consumption go through the roof while its manufacturing sector is lagging badly and it doesn't export much of any finished products - all I can say is whatever source is I wouldn't want to be around when it dries up. Things could get unpleasant, rather like having a heart attack is unpleasant.


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