Archive for March, 2009
Like millions of Americans, I dread getting my quarterly 401k statement. Every time I open one I think, “I guess I won’t be retiring at 65.” And so it didn’t really come as a surprise when the Federal Reserve reported that household net worth plunged $11.2 trillion in 2008, a stunning 18 percent loss in one year. No wonder The New York Times says that “the most recent loss of wealth is staggering.”
So did this wealth actually disappear? Of course not. My house is still here. The companies in which my mutual funds own stock are still there. All that changed was this: The prices at which American asset owners can sell their assets fell by $11.2 trillion. But the prices that buyers have to pay for those assets also fell by $11.2 trillion. And that’s not necessarily a bad thing.
Consider housing. When hurricane Katrina demolished more than 275,000 homes, America was $80 billion poorer. In contrast, after the recent financial hurricane demolished the value of homes, there were 750,000 more homes in America. Current owners will get $2.1 trillion less when they sell and will have to
Five countries—Singapore, Sweden, Luxembourg, Denmark, and South Korea—outperform the United States in international competitiveness and innovation, according to The Atlantic Century: Benchmarking EU & U.S. Innovation and Competitiveness released on February 24th by the Information Technology and Innovation Foundation (ITIF) and the European-American Business Council (EABC).
Several developing nations are lagging behind in the transition into globally competitive, innovative economies with India, Mexico, and Brazil the bottom three ranked countries of those analyzed, in reverse order. Although economic competitiveness is not a given for Europe with Cyprus and Greece finishing 4th and 5th from the bottom, respectively.
The unprecedented geographical freedom afforded to firms due to advanced transportation and communication technologies and the corresponding rise of global competition is well known. Less well known is which countries have taken advantage of these technologies and global opportunities and which have fallen behind.
The Atlantic Century assesses global competitiveness and innovation by ranking 36 countries along with the European Union and NAFTA region based on economic structure, policy and performance across 16 indicators. Although it is by no means an exhaustive study, the report shines a light on high-performing countries in diverse