You Can Stop Worrying about Overpopulation

But if you really need something to worry about, just put underpopulation in that slot.

Natural Resources and Standard of Living

Natural resource endowments help make a nation prosperous...unless you use them to the almost exclusive benefit of those in power. An example:

Qaddafi's Libya produces 0.27 barrels per citizen per day; the United Arab Emirates (where Dubai is located) produces 0.34 barrels per citizen per day. Yet the average Emirati is three times as wealthy as the average Libyan, according to IMF data on gross domestic product at purchasing power parity per capita. Why are Libyans poorer on average than Mexicans while Emiratis richer than Americans?

Exhibit A: Journalists Are Good at Journalism; Business, Maybe Not

Michael Giberson takes the Wall Street Journal to school for this article about gasoline and crude prices. The "gasoline prices aren't falling as fast as the price of crude" story is hardly breaking new ground, but this time it's not even valid as a storyline:

The mystery of the just-down-13-percent gasoline prices is almost entirely created by trying to treat the NYMEX price as the relevant benchmark, but it isn’t. (As noted here in February.) Currently the Brent price is a better indicator of the world oil market price for crude oil. Our story here, then, is that world oil prices have dropped 18 percent since April while average gasoline prices dropped 13 percent. Hardly a different warranting a headline.

The reporter fully recognizes this point, as he explains, “gasoline prices on the East Coast and even in the Gulf Coast track the price of Brent crude, which analysts view as a better indicator of global prices than Nymex. While Nymex futures are down 30% since April 29, Brent is down 18%.” And the story is accompanied by a graphic, above, which graphically illustrates the point that Brent seems to be the relevant reference point.

So why the struggle to cast this story about gasoline prices that are not falling fast enough?

The whole thing reminds me of something a professor told us often: "Remember, the guys who write for the WSJ are more likely to be experts at journalism than at business. Don't be too ready to learn about your industry from a journalism major."

Yep.

Not an Even Bet

Even if I were a betting man, I wouldn't bet against China now:

The importance of exports as a driver of China's growth is overstated. Exports as a percentage of China's 2010 gross domestic product were 27%, down from 35% in 2007. In value-added terms, the real share of exports is even smaller. UBS economist Wang Tao sees a base case in which falling exports shave a percentage point from China's 2012 GDP growth. With GDP growth expected to be around 9% in 2011, all else being equal, that is hardly a disaster.

Real-estate investment is a key driver of China's growth, equal to around 14% of GDP in 2010. Ghost towns of empty houses raise fears that construction might be set to slow sharply. But with millions moving from the countryside to the city each year, and rising wages driving demand for higher-quality accommodations for existing city dwellers, fundamental demand is strong. The government also has policy options: Borrowing restrictions for developers can be loosened and speculators allowed back into the market.

Spot on.

There are way too many empty apartments in the cities now. But there are still hundreds of millions of people who are going to want to fill them in the coming years. If prices fall, it will simply speed up migration to the cities.