European Union Unemployment Rate 2017

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Above is a map displaying the unemployment rate for European Union member states as of May 2017. What sticks out is the slow economic recovery for the southern European states post-financial crisis, such as: Greece (with an unemployment rate of) 22.5%, Spain 17.5%, Itlay 11.3%, and Croatia 10.7%. Contrast this with the unemployment rate in the United States during the same period of 4.3%. The EU average unemployment rate stands at 7.8%, nearly twice as high of the US! An economic analysis of labor policies in most EU countries leads to this result as there is less fixability in the labor force among other factors. Despite this performance for the European Union as a whole, some countries are performing above average and are on par with the US in employment rate such as: Germany, Austria, Czech Republic, UK, Poland, and others.

SF Bay Area Median Home Price Apr 2017

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Above is a map displaying the median home prices for cities in the SF Bay Area as of April 2017 on Zillow. The most expensive cities in order are: Palo Alto 2.5 million, Cupertino 1.8m, Mountain View 1.5m, Sunnyvale 1.5m, Redwood City 1.3m, San Francisco 1.2m.

Below is a chart displaying the median home price changes for the four largest cities in the Bay Area since Jan 2012. Home prices have doubled in the past five years with cities such as Oakland up 123%, Mountain View up 112%, and Palo Alto up 103% over the period.Screen Shot 2017-06-02 at 10.24.56 AM.png

Country Exports to the US

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The map above displays each country in the Americas largest export to the United States. It is color coded by various categories listed in the legend. Note that Cuba is grayed out with “No Data” as the US does not trade with them due to the long-standing embargo. Latin America’s two largest economies (Brazil and Mexico) export industrial goods to the US – Planes, Spacecraft, and Cars – while most other countries in South America export natural resources (Sugar, Gold, and Oil). The Caribbean typically exports food products and textiles: bananas, fish, t-shirt, sweaters, etc.

Europe Income Brackets

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Above is a map of Europe color-coded into three income brackets – Dark green: greater than 40k euros per capita, Light green: between 20k and 40k euros per capita, and red: less than 20k euros per capita. Note the values are calculated in Purchasing Power Standards (PPS) a metric used by Eurostat for cross-country comparisons. PPS tires to correct for cost of living and price level differences, especially among nations with different currencies. For comparison to the United States, 40k euros converts to 44k dollars (2017 prices). US GDP per capita is 55k dollars, with the highest continental state: New York at 72k USD and lowest: Mississippi at 35k USD. This means the area’s in dark green in the map above (among the highest in Europe) would rank on the lower end of US states, around 40th out of 50.

Total World Wealth, 2016

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Wealth is a different concept than income. Income is what you earn with your labor (your job) and wealth is the assets you own minus your liabilities (or debt). Said differently, the accumulation of income and property passed from generation to generation over time is wealth. Income inequality has been growing in the United States over the past 30 years and is a hot button issue, but wealth inequality is a different and even more extreme situation – especially at the global level: The richest 1% of adults in the world hold 50% of global wealth, while the top 10% hold 85%!

The total wealth of the world is estimated to be $255 trillion dollars by Credit Suisse in 2016. Of this, $84 trillion (33%) was located in the United States. Other wealthy countries include: Japan $24 T, China $23 T, UK $14 T, Germany $12 T, and France $11 T. One way to picture this distribution is with the map above colored in three tiers – The US has 1/3 of world wealth, Japan-China-UK-Germany-France combined have 1/3 of world wealth, and the remainder of the world, some 188 countries, have 1/3 of world wealth.

What are the assets that make up this wealth? Real estate is a large fraction of the total. Numbers are difficult to find but of the $84 trillion dollars of wealth in the US, $27 T (32%) of the value was real estate (2014 estimate). Another large fraction is located in financial assets: ownership of stocks, bonds, etc. This market is also concentrated with stock exchanges in the United States or Europe representing 80% of the global allocation of mutual fund assets.

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Netflix Subscription Growth

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The subscription growth of Netflix over the past 5 has been stunning, especially when you consider the performance of its competitor: cable. As of the fourth quarter in 2016, Netflix now has more subscribers than total cable subscribers – growing from under 25 million in 2012 to nearly 50 million by 2016. Note that these figures only include US domestic subscribers, not global users. Global subscribers are expected to rise as Netflix expanded into new markets in Africa, Asia, and Eastern Europe (pictured in the graphic below). It seems that people are not watching less TV, rather watching it through a different and more mobile friendly medium.

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Historic Economic Power

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The chart above shows the percent of global economic power (defined as the weighted share of world GDP, trade, and net capital exports) for the top three countries in selected years ranging from 1870 to (projected) 2030. To me, the graph shows the decline in power of Britain from 1870 through 1950, the decline in power for the United States from 1950 through 2030 (although less quickly than Britain), and the rise of China from 2010 into the near future. What once was a European-centric world in the 1800’s is giving why to an East Asian-centric world in the 21 century with the rise of China and India. Side note: If the European Union is considered as a unified entity in the chart above, its scale and decline would closely match that of the US.

US Income Inequality 1970-2010

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There is increased attention focused on US income inequality in recent years. It remains a challenge to isolate different contributing factors for this inequality growth over the past generation although some reasons have been cited, such as: increased trade with developing countries, increased income for those with university degrees (only around 30% of the US population), increased role of technology in the economy, etc. This post will not dive into trying to uncover why income inequality is happening, but rather, how the various income groups have been affected since 1970.

Above is a chart displaying the US population grouped into five income brackets. What is clear from the data is for the bottom 80% of US income earners, all groups are receiving a smaller share of total US income than compared to 1970 and 1990. Meanwhile, across this same period, the highest fifth of income-earners in the US have received an increasing share of income compensation – from 43.3% in 1970 to 46.6% in 1990 to 50.3 percent in 2010.

Although, to play devil’s advocate, what makes this issue even more complicated is that individuals are not in the same group over time, it is hard to factor in changes in the quality of goods, or even, the modern luxuries of goods that didn’t even exist 40 years ago such as the internet, smart phones, laptop computers, etc. Even though the percentage of income the bottom 80% of income earners is responsible for has decreased over the period, it’s clear that they are living better lives considering all the improvements in technology, safety, and healthcare.

US Income Distribution 2015

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Income data from the 2015 US census reveals some insight. 39% of all households had two or more income earners resulting in 25% of households having a combined income above $100k. Meanwhile, only 9% of US workers (population age 15 or older) have individual incomes over $100k. These high earners are typically associated with high education levels as half of all people with graduate degrees are also among the top 15% of income earners (individual incomes greater than $75k).

In 2015, US median personal income was $30k and the mean personal income was $44k. For the US population aged 15 and above, 43% make less than $25k, 70% make less than $50k, 84% make less than $75k, and 91% make less than $100k. Similar data is displayed in the bar chart above – one chart shows the distribution for ages 25 through 64 and the other for ages 25 and above.

Bay Area Median Home Price 2016

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The San Francisco Bay Area is one of the most expensive places to live in the United States. The map above displays the median home price for the top 30 most populated cities in the Bay Area. The larger the bubble, the higher the median home price. The bubbles are also color coded – Red the highest 20%, Orange the next 20%, then Green, Blue, and Purple the lowest 20% by median home price.

Regionally, the cities comprising Silicon Valley are the most expensive and the cities in the northeastern bay are the cheapest. In order, the most expensive cities in the bay area by median home price (via Zillow) as of 2016: Palo Alto at 2.5 million, Cupertino 1.8 million, Mountain View 1.4 million, Sunnyvale 1.4 million, Redwood City 1.3 million, San Mateo 1.1 million, and San Francisco 1.1 million.

The most affordable housing in the Bay Area (of the top 30 by population) are: Richmond 411k, Vacaville 391k, Fairfield 390k, Antioch 364k, Pittsburg 357k, and Vallejo 326k.