Analytics

During the last fifty years the world’s population has more than doubled, from 3.7 bn. in 1970 to 7.8 bn. in 2020, and will likely reach 11.0 bn by 2100. The growing number of people around the world is one of the main causes of global warming. From this perspective it is hard to argue that the Earth needs more people.

Exponential growth means if Armenia’s GDP per capita grows at about 10% per year, it will rise from $4,000 in 2020 to more than $20,000 in 2041. For various scenarios of GDP and population growth, see Tables 1 and 2 below.

We must distinguish between two types of sovereignty – domestic and international. In domestic matters, the Emir of Qatar has more autonomy (or sovereignty) than the President of the United States, simply because the American society has placed stricter limits “on the right of one man to rule another.”

By definition, strategy and vision are about the long-term. People, businesses and organisations often develop strategies, but can a country or a nation have a vision or strategy? Do countries such as France, Canada or Britain have a strategy, and if yes, where is it written?

“A truly great business must have an enduring “moat”. The dynamics of capitalism guarantee that competitors will repeatedly assault any business “castle” that is earning high returns. Therefore, a formidable barrier (the moat), such as low-cost or a powerful brand is essential for sustained success. Business history is filled with companies whose moats proved illusory and were soon crossed.

Reading time ~ 7 min. This is Part II of our three-part research note on Money, Debt, Inflation & Wealth Preservation. In part one we argued that we should not be paying too much attention to money supply (and money printing) statistics. As shown in Chart 1 below, the relationship between money supply and inflation broke down a long time ago.

Lots of people around the world are worried about their lifetime savings. A friend recently asked: “My father-in-law has left my wife an inheritance of US$ 100.0 million in cash. As you know, my wife and I make a good living and don’t really need that money. We have decided to leave the entire inheritance to our kids.

Trust raises profits by simplifying structures, accelerating processes and pacifying relations. Lack of trust, on the other hand, leads to complex processes, piles of paperwork and bloated back-office personnel. This truism applies to people, families, businesses, societies or countries.

Can dictatorships or authoritarian regimes be better than democracies? Friedrich Hayek received a Nobel Prize in economics, but most of his writings were dedicated to political philosophy. Hayek worked and lived in Austria, Germany, Britain, America; taught at the London School of Economics, University of Chicago and was always surrounded by brilliant minds such as John Maynard Keynes, Sir John Hicks, Bertrand Russell, Milton Friedman, to name a few. Hayek passed away in 1992, at the age of 93.

Which currency exchange rates should we use when comparing wealth or incomes across countries with different currencies? Although current (or actual) currency exchange rates can be volatile, PPP (Purchasing Power Parity) exchange rates can be completely misleading.