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Thursday, November 06, 2003 |
 Washington Post. Wow. The US productivity rate is going through the roof.
For the third quarter, output in the non-farm sector rose at an 8.8 percent annual rate while the number of hours worked increased at only an 0.7 percent rate (effectily 8.25% productivity growth). Hourly compensation paid to workers climbed at a 3.1 percent rate, but the efficiency gains were so large that labor costs per unit of output fell at a 4.6 percent rate.
This is good and bad news. To create jobs, the economies growth needs to be 1-2% higher than productivity growth. Right now it is 1% lower. The high productivity growth does however mean that corporate profits can increase without pricing power (which means efficient marketplaces) while still increasing pay for workers (which means higher demand for products and services). The big question is: how long is this productivity growth rate going to last?
7:22:55 PM 
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Stephen Delany is testing the beta of the SocialDynamX interface that posts to Manila weblogs. It is a slick, fast interface with all the standard word processing tools.
12:15:44 PM
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Rick Klau relates the fun buying experience he had at CDBaby. CDBaby sells CDs for the 99% of musicians that aren't on a major label. A full 2/3rds of the $12 CD cost goes to the artists. By my calculations, based on data he provided to Esquire in a recent interview, he is generating $7.2 m a year in revenue and is very profitable. Of course, this is what MP3.com should have done but didn't (this was the plan in when I talked to the CEO of MP3.com back in 1998, but he took VC money and the rest is history).
12:05:27 PM
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Megnut reports that Howard Dean rules Meetup.
11:52:47 AM
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Print your own temporary tatoos.
10:57:08 AM
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Given that digital camera phones are now outselling digital cameras, the topic is hot. Alan Reiter has started a new weblog on the topic. Smart. It's great to see smart analysts setting up weblogs on specific topics.
8:29:53 AM
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Fortune (sorry it is premium content). Warren Buffet writes a great article on why he is investing outside of the US for the first time in his life.
In the late 1970s the trade situation reversed, producing deficits that initially ran about 1% of GDP. That was hardly serious, particularly because net investment income remained positive. Indeed, with the power of compound interest working for us, our net ownership balance hit its high in 1980 at $360 billion.
Since then, however, it's been all downhill, with the pace of decline rapidly accelerating in the past five years. Our annual trade deficit now exceeds 4% of GDP. Equally ominous, the rest of the world owns a staggering $2.5 trillion more of the U.S. than we own of other countries. Some of this $2.5 trillion is invested in claim checks—U.S. bonds, both governmental and private—and some in such assets as property and equity securities.
Currently, 5% of the current US net worth is held by the rest of the world, and that number is increasing by 1% a year. To rectify this, the US government is likely to let the dollar slide. How far? I have read estimates as high as 40%. That is a nice return over a 3-4 year time period without even taking into account the investment vehicles invested in internationally.
7:55:37 AM
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Business 2.0. Technology of the year: social network applications. Here's a business oriented version of SNA.
Spoke works by indexing a firm's e-mail archives, address books, buddy lists, and calendars to build a map of the company's human network. The software also conducts Web searches to compile profiles about business prospects; these mini-biographies are augmented with quotes from online articles to provide background on a potential customer's interests or mind-set.
7:41:35 AM
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© Copyright 2004 John Robb.
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