The Big Picture - Macro Perspective on the Capital Markets, Economy, Technology, and Digital Media

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New Scientist.com:

“What is clear is that for the 6.2 years since 2004, there have been more great earthquakes around the world than in any 6.2-year period throughout the 110-year history of seismic recordings.”
-Thorne Lay at the University of California, Santa Cruz.

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Source:
The megaquake connection: Are huge earthquakes linked?
Catherine Brahic
New Scientist, 16 March 2011
http://www.newscientist.com/article/mg20928043.000-the-megaquake-connection-are-huge-earthquakes-linked.html

Read the rest of this entry »

I am not particularly a Porsche fan, but the stats on the Porsche 918 Spyder hybrid plug-in are astounding:

• 0-60 in 3.1 seconds

• 78MPG

•  MSRP $845,000

Pre-orders now being taken at your friendly local Porsche dealer.

Get one . . .

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Porsche Press Release after the jump

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• Kessler: Raise Rates to Boost the Economy (WSJ)
• James Surowiecki: Creative Destruction? (New Yorker)
• Dan Gross: 3 Things Banks Should Do Before They Pay Dividends (Yahoo Finance)
• Small Changes, Big ResultsBehavioral Economics at Work in Poor Countries (Boston Review)
• Possible Early Warning Sign for Market Crashes (Wired)
• A surprising culprit in the nuclear crisis (Boston Globe)
• Banking on a Paywall at The New York Times (Businessweek)
• Can Google help turn trash into gasoline? (Fortune)
• Frank Cottrell Boyce on Filmmaking (The Browser) 

Please visit the KeithRichards.com Store now to order a very special limited edition t-shirt Keith is making available. The Japan Relief t-shirt is based on a photo taken by Claude Gassian on the Japanese leg of the Steel Wheels tour in 1990 and is available in both classic and fitted styles.

Keith will be sending 100% of the profits from the shirt’s sales to the Japan Society’s Earthquake Relief Fund.

Way back in 2007, I found this obscure chart from The York Group on a Norwegian blog, posted previously as Countries GDP as US States.

The Economist has not only dug up this map, but went it one better, doing the same for China’s provinces that was done for the US. Here are both of their versions:

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Comparing Country’s GDP to US States

Chart courtesy of The Economist

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Comparing Country’s GDP to China’s Provinces

Chart courtesy of The Economist

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Previously:
Countries GDP as US States (January 15th, 2007)

I read an interesting NYT article (No Hero in 1811, Street Grid’s Father Was Showered With Produce, Not Praise) this morning about John Randel Jr., the creator of Manhattan’s rectilinear grid — officially known as “Commissioners’ Map and Survey of Manhattan Island.”

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click for interactive

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Source:
No Hero in 1811, Street Grid’s Father Was Showered With Produce, Not Praise
SAM ROBERTS
NYT, March 20, 2011 http://www.nytimes.com/2011/03/21/nyregion/21randel.html

See also:
200th Birthday for the Map That Made New York (NYT, March 21, 2011)

Unturned Cobblestones on the City’s Grid

March 11 eyewitness video: In under 10 minutes, a harbor in Oirase Town, Aomori Prefecture is wiped out. A huge dry area that completely fills with water, showing just how much Ocean is moved by the Tsunami.

Hat tip boingboing

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Interesting observations from Merrill Lynch’s Sheryl King and Ryan Bohren. They believe Canadian housing is “in bubble territory” with commensurate “down-side risks remain despite an accelerating economy.”

However, they are not looking for a Canadian Housing crash.

The “structure of the Canadian mortgage market greatly reduces the probability of a US style housing melt-down.” The US had excessively risky lending by vulnerable financial institutions, along with vastly over supplied housing market.

What makes Canada so different?Four factors of the Canadian mortgage market:

1. We find government guaranteed mortgage insurance mitigates risk to financial institutions. Unlike the US where financial institutions were clearly over exposed and the solvency of insurance providers were questionable. 75% of mortgages in Canada are fully insured with Government guarantees and all mortgages with an LTV higher than 80% must be insured by regulated lenders.

2. Legal recourse laws reduce the risk of households walking away from their mortgage and implicitly improve lending quality, unlike the US where reports of abandoned vacant homes were and remain rampant. By our estimation around 90% of mortgages are full recourse in Canada, creating a more lender-friendly environment.

3. About 30% of the mortgage funding market has a federal government guarantee, which likely reduces the risk of a US style funding freeze. Indeed during the height of the credit crisis, the Government of Canada initiated a very effective Insured Mortgage Purchase Program which essentially kept the Canadian mortgage market functioning.

4. Canadian’s have historically held lower leverage ratios than their US counter parts and tend to gravitate to more conservative mortgage options. Canadian household balance sheets have deteriorated and have been treading into more risky areas like variable rate mortgages, but sub prime lending remains a virtually non-existent market in Canada.

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UPDATE: March 21, 2011 3:22pm
Here is the Merrill piece:

Our homes have four walls (PDF)

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Source:
Why no Canadian, Australian housing busts?
Tracy Alloway
FT Alphaville, Mar 21 15:31.
http://ftalphaville.ft.com/blog/2011/03/21/521346/why-no-canadian-australian-housing-busts/

I have a few favorite Housing charts: Median Income to Median Home Price, Housing Value as % of GDP.

This one may very well be my favorite: Existing Home Sales NOT Seasonally Adjusted.

Why? A few reasons:

• It shows the seasonal rhythm of housing sales, ticking up each month from January forward, with an annual double top in May/July.

• Its relative — no matter how much the NAR data may be flawed, it is a consistent methodology. Thus, comparing the year-over-year numbers provides some insight into the Housing market.

• The impact of the government tax credit is obvious (see Yellow line); once that faded, prices faded as well.

Here is the chart:
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click for ginormous chart

Chart courtesy of Calculated Risk

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Sources:
February Existing-Home Sales Decline
NAR, March 21, 2011
http://www.realtor.org/press_room/news_releases/2011/03/feb_decline