Wednesday, January 6, 2010

A harbinger or two

What is over that next hill?

The Clarion Content stumbled across a two notes this week that we wondered if were harbingers. As regular readers know, although our hope is that the global economic turbulence has peaked and the world economy has bottomed out, we are not confident that is the case. In support of our concerned point of view we read an intriguing analysis in the Christian Science Monitor about the opening of the world's tallest building.

Come again you say?

Well according to the Monitor, when the newest "world's tallest building" opened this Monday in Dubai it was "an exuberant architectural triumph in the middle of a deep economic swamp." The Monitor notes that, "It's often that way. The tallest skyscrapers always seem to pop up just as the economy is headed down." They have interesting graph noting some of the previous correlations of new "world's tallest building" title holders and economic slumps. Their theory is "The skyscraper index works because developers tend to make ambitious gambles with huge new towers at the point of the business cycle when interest-rate and price signals can get distorted." They cite the Austrian School economist Mark Thorton. The Austrian School's austere teachings have been popping up more frequently in these hard economic times.

The second harbinger was from a political stability angle rather than an economic one. But perhaps, it is the way in which the world economy has wobbled that prompted the rarely hysterical Economist to run a chart of the day under the heading of "Global Tinderbox." The chart shows a world map that rates countries by their state of potential combustibility in 2010. Their conclusion? 2010 could be a year that sparks unrest.

Dark portends.

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