It’s official: America is now No. 2

Thanks, Obama.

Thanks, Obama.

All time lowest labor participation rate to go with it, he is "the food stamp president"

This is not based on actual GDP, in which I think we still exceed China materially. This is based on purchasing power parity, which requires a lot of assumptions. USA is still number 1 in the metric that actually counts - GDP.

At one time, Spain was the biggest economy on the planet. Nobody stays on top forever. Neither will China.

Some oil and gas exploration and production companies provide a metric called "debt-adjusted earnings per share."

This metric basically shows what the company's earnings per share would be if all it's debt were converted to equity at current market prices and allows analysts to discern whether the company's earnings growth is being managed in a debt-efficient manner.

I'd love to see a comparison of the two countries' real outputs on debt-adjusted terms. China has been growing like wildfire, but it's been wildly fueled by debt, leading me to wonder whether the size of its economy is really that impressive to begin with.

It would be like comparing a company with $100mm in revenue and $250mm in debt (China's debt to GDP is 250%) to a company with $95mm in revenue and $95mm in debt (the U.S.'s debt to GDP is about 100%).

Finally, the study you cited used PPP-adjusted output, which is great for comparison purposes, but doesn't present an accurate picture of what the country's real output is since the majority of Chinese in fact aren't buying and selling goods in dollars.

See here:

LINK

China has over four times our population. The closer the world gets to free trade, the more "economy size" will track population size.

In the meantime wake me up when they get anywhere close on a per capita basis.

quote:

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Some oil and gas exploration and production companies provide a metric called "debt-adjusted earnings per share."

This metric basically shows what the company's earnings per share would be if all it's debt were converted to equity at current market prices and allows analysts to discern whether the company's earnings growth is being managed in a debt-efficient manner.

I'd love to see a comparison of the two countries' real outputs on debt-adjusted terms. China has been growing like wildfire, but it's been wildly fueled by debt, leading me to wonder whether the size of its economy is really that impressive to begin with.

It would be like comparing a company with $100mm in revenue and $250mm in debt (China's debt to GDP is 250%) to a company with $95mm in revenue and $95mm in debt (the U.S.'s debt to GDP is about 100%).

Finally, the study you cited used PPP-adjusted output, which is great for comparison purposes, but doesn't present an accurate picture of what the country's real output is since the majority of Chinese in fact aren't buying and selling goods in dollars.

See here:

---

Doesn't really make sense. The U.S. is not a company, the profits of business are for business and the debt of the U.S. is the U.S's not business's.


If you REALLY want to treat the U.S. like a company - you need to realize its got about $128,000,000,000,000 in oil and mineral assets alone - so $18,000,000,000,000 is actually a pretty low debt-to-asset ratio.


LINK

Right, but country output is akin to company revenue, and country debt at least resembles company debt. So maybe a better analogy would have been to refer to a company's debt-adjusted revenue per share. In any event, I think some attempt to normalize comparisons between the two for debt can be made.