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Visualizing America’s Energy Use, in One Giant Chart

Visualizing America’s Energy Use, in One Giant Chart

Have you ever wondered where the country’s energy comes from, and how exactly it gets used?

Well now, thanks to Visual Capitalist’s Jeff Desjardins, we have the answer as The Lawrence Livermore National Laboratory (LLNL) crunches the numbers every year, outputting an incredible flow diagram that covers the broad spectrum of U.S. energy use.

The 2019 version of this comprehensive diagram gives us an in-depth picture of the U.S. energy ecosystem, showing not only where energy originates by fuel source (i.e. wind, oil, natural gas, etc.) but also how it’s ultimately consumed by sector.

In Perspective: 2019 Energy Use

Below, we’ll use the unit of quads, with each quad worth 1 quadrillion BTUs, to compare data for the last five years of energy use in the United States. Each quad has roughly the same amount of energy as contained in 185 million barrels of crude oil.

Interestingly, overall energy use in the U.S. actually decreased to 100.2 quads in 2019, similar to a decrease last seen in 2015.

It’s also worth noting that the percentage of fossil fuels used in the 2019 energy mix decreased by 0.2% from last year to make up 80.0% of the total. This effectively negates the small rise of fossil fuel usage that occurred in 2018.

Energy Use by Source

Which sources of energy are seeing more use, as a percentage of the total energy mix?

Since 2015, natural gas has grown from 29% to 32% of the U.S. energy mix — while coal’s role in the mix has dropped by 4.7%.

In these terms, it can be hard to see growth in renewables, but looking at the data in more absolute terms can tell a different story. For example, in 2015 solar added 0.532 quads of energy to the mix, while in 2019 it accounted for 1.04 quads — a 95% increase.

…click on the above link to read the rest of the article…

Prediction Consensus: What The ‘Experts’ See Coming In 2020

Prediction Consensus: What The ‘Experts’ See Coming In 2020

Through the ages, humans have feared uncertainty. We’ve searched for clues in everything from entrails to tea leaves to the arrangement of heavenly bodies in the night sky.

In the modern era, data and media are the new magic 8-ball. The jury is still out on whether we’ve gotten any better at anticipating the forces that will shape the coming year, but that certainly hasn’t stopped people from trying.

Of the hundreds of forward-looking pieces of content published in the lead-up to 2020, how many of the expert predictions lined up? Was there a consensus on any particular trend, or were predictions all over the map?

During the month of December, Visual Capitalist’s Nick Routley analyzed over 100 articles, whitepapers, and interviews to answer that question. While there was no firm consensus on where 2020 will take us, there were a few themes that appeared in multiple publications. Today’s graphic highlights these reappearing predictions, and below, we examine seven of them in more detail.

The Promise and Controversy of 5G

One technology that’s sure to capture the headlines in 2020 is 5G. Broadband speeds of over one gigabit per second will become a reality when 5G technology rolls out across the country, without the cable that currently connects most homes. This prediction is a slam dunk, as some carriers are already testing the technology in select neighborhoods around the United States.

Experts also predict that a wave of 5G-enabled smartphone and IoT products will become commercially available in 2020.

The wild card in this 5G story will be guessing which companies end up building out the new network. Huawei was in a strong position to lead the charge, but the company has been stonewalled in a number countries – most notably the United States, Australia, and Japan. Whether due to national security concerns or protectionism, Chinese companies may continue to face an uphill battle in Western markets.

…click on the above link to read the rest of the article…

The History Of Interest Rates Over 670 Years

The History Of Interest Rates Over 670 Years

Today, we live in a low-interest-rate environment, where the cost of borrowing for governments and institutions is lower than the historical average. It is easy to see that interest rates are at generational lows, but, as Visual Capitalist’s Nicholas LePan notes below, did you know that they are also at 670-year lows?

This week’s chart outlines the interest rates attached to loans dating back to the 1350s. Take a look at the diminishing history of the cost of debt—money has never been cheaper for governments to borrow than it is today.

The Birth of an Investing Class

Trade brought many good ideas to Europe, while helping spur the Renaissance and the development of the money economy.

Key European ports and trading nations, such as the Republic of Genoa or the Netherlands during the Renaissance period, help provide a good indication of the cost of borrowing in the early history of interest rates.

The Republic of Genoa: 4-5 year Lending Rate

Genoa became a junior associate of the Spanish Empire, with Genovese bankers financing many of the Spanish crown’s foreign endeavors.

Genovese bankers provided the Spanish royal family with credit and regular income. The Spanish crown also converted unreliable shipments of New World silver into capital for further ventures through bankers in Genoa.

Dutch Perpetual Bonds

perpetual bond is a bond with no maturity date. Investors can treat this type of bond as an equity, not as debt. Issuers pay a coupon on perpetual bonds forever, and do not have to redeem the principal—much like the dividend from a blue-chip company.

By 1640, there was so much confidence in Holland’s public debt, that it made the refinancing of outstanding debt with a much lower interest rate of 5% possible.

Dutch provincial and municipal borrowers issued three types of debt:

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“It’s Not A Game When It’s Real-Life” – China’s Social Credit System

“It’s Not A Game When It’s Real-Life” – China’s Social Credit System

In an attempt to imbue trust, China has announced a plan to implement a national ranking system for its citizens and companies. Currently in pilot mode, the new system will be rolled out in 2020, and go through numerous iterations before becoming official.

While the system may be a useful tool for China to manage its growing 1.4 billion population, Visual Capitalist’s Katie Jones notes that it has triggered global concerns around the ethics of big data, and whether the system is a breach of fundamental human rights.

Today’s infographic looks at how China’s proposed social credit system could work, and what the implications might be.

 …click on the above link to read the rest of the article…

The Silver Series: The Start of A New Gold-Silver Cycle (Part 1 of 3)

The Silver Series: The Start of A New Gold-Silver Cycle (Part 1 of 3)

The world has experienced a decade of growth fueled by record-low interest rates, a burgeoning money supply, and historic debt levels – but the good times only last so long. 

As the global economy slows and eventually begins to retract, can precious metals offer a useful store of value to investors?

Part 1: The Start of a New Cycle

Today’s infographic comes to us from Endeavour Silver, and it outlines some key indicators that precede a coming gold-silver cycle in which exposure to hard assets may help to protect wealth. 

The Start of a New Gold-Silver Cycle

Bankers Blowing Bubbles

Since 2008, central bankers around the world launched a historic market intervention by printing money and bailing out major banks. With cheap and abundant money, this strategy worked so well that it created a bull market in every sector — except for precious metals. 

Stock markets, consumer lending, and property values surged. Meanwhile, the U.S. Federal Reserve’s assets ballooned, and so did corporate, government, and household debt. By 2018, total debt reached almost $250 trillion worldwide. 

Currency vs. Precious Metals

The world awash in unprecedented amounts of currency, and these dollars chase a limited supply of goods. Historically speaking, it’s only a matter of time before the price of goods increases or inflates – eroding the purchasing power of every dollar. 

Gold and silver are some of the only assets unaffected by inflation, retaining their value.

Gold and silver are money… everything else is credit.

– J.P. Morgan

The Perfect Story for a Gold-Silver Cycle?

Investors can use several indicators to gauge the beginning of the gold-silver cycle:

  1. Gold/Silver Futures

    Most traders do not trade physical gold and silver, but paper contracts with the promise to buy at a future price. Every week, U.S. commodity exchanges publish the Commitment of Traders “COT” report. This report summarizes the positions (long/short) of traders for a particular commodity. 

 …click on the above link to read the rest of the article…

The History Of The World, In One Video

The History Of The World, In One Video

Throughout the history of the world, many civilizations have risen and fallen.

You may be familiar with the achievements of prominent societies like the Romans, Mongols, or Babylonians, but, as Visual Capitalist’s Jeff Desjardins explains belowhow do all of their stories intertwine over time and geography?

Visualizing the History of the World

Today’s video comes to us from Ollie Bye, and it attempts to integrate the histories of all major civilizations known by historians into a single, epic video.

Similar to the Histomap, it’s pretty much impossible for a video like this to be perfect due to biases and a general lack of data. However, it’s still a compelling attempt at showing global history in a short and sweet fashion.

Let’s look at some specific moments on the video that particularly stand out.

750 AD: The Umayyad Caliphate

One of the largest empires in history, the Umayyad Caliphate peaked sometime around 750 AD.

Conquering most of North Africa, the Middle East, and even parts of Europe (including modern-day Spain, Portugal, and France), the Umayyads commanded a formidable territory with an area of 11,100,000 km² (4,300,000 sq. mi) and encompassing 33 million people.

1279: Mongol Dominance

No history of the world is complete without a mention of the Mongols.

Nearby societies have always been on edge when nomadic tribes in the Eurasian Steppe entered into organized confederations. Similar to the Huns or various Turk federations, the Mongols were known for their proficiency with horses, bows, and tactics like the feigned retreat.

Under the leadership of Temüjin ⁠— also known as Genghis Khan ⁠— the Mongols conquered one of the largest empires by land.

 …click on the above link to read the rest of the article…

The Top Global Risks in 2019

The Top Global Risks in 2019

The suits are pressed and the jets are gassed up, as global political and business leaders prepare to converge in Davos for the World Economic Forum.

To prep the wide variety of world leaders attending the summit, the organization has just published its most recent edition of the Global Risks Report. The highly anticipated annual presentation puts the world’s most pressing issues into focus, giving a sense of what is top-of-mind for global decision-makers.

Below are the top five risks highlighted in this year’s report.

Visualizing the Top Global Risks in 2019

THE WORLD’S EVOLVING RISK LANDSCAPE

The report looks at two specific ways of evaluating global risks: 

  1. The likelihood of an event occurring
  2. The impact or severity of an event, should it occur

And over recent years, it’s clear that the composition of these top threats has evolved.

top global risks over time

In 2009, the world was still reeling from the global financial crisis, so economic concerns were naturally at the forefront of discussions. 

Today, the most likely scenarios to play out in the near future involve extreme weather events and natural disasters. Also trending upward are cyber-security threats and concerns over the security of personal data.

RISK PERCEPTION

Each year, the Global Risks Perception Survey looks at which risks are viewed by global decision-makers as increasing in the coming year.

global risks survey 2019

Some clear themes emerge from the responses:

A Breakdown in Geopolitical Cooperation
From trade wars to the dissolution of weapons treaties, cooperation between countries is on the decline. Leaders are concerned that this divergent geopolitical climate may continue to inhibit collective progress on important global challenges.

 …click on the above link to read the rest of the article…

Visualizing The Snowball Of Global Government Debt

Over the last five years, markets have pushed concerns about debt under the rug.

But, while economic growth and record-low interest rates have made it easy to service existing government debt, Visual Capitalist’s Jeff Desjardins points out that it’s also created a situation where government debt has grown in to over $63 trillion in absolute terms.

The global economic tide can change fast, and in the event of a recession or rapidly rising interest rates, debt levels could come back into the spotlight very quickly.

THE DEBT SNOWBALL

Today’s visualization comes to us from HowMuch.net and it rolls the world’s countries into a “snowball” of government debt, colored and arranged by debt-to-GDP ratios. The data itself comes from the IMF’s most recent October 2018 update.

Courtesy of: Visual Capitalist

The structure of the visualization is apt, because debt can accumulate in an unsustainable way if governments are not proactive. This situation can create a vicious cycle, where mounting debt can start hampering growth, making the debt ultimately harder to pay off.

Here are the countries with the most debt on the books:

Note: Small economies (GDP under $10 billion) are excluded in this table, such as Cabo Verde and Barbados

Japan and Greece are the most indebted countries in the world, with debt-to-GDP ratios of 237.6% and 181.8% respectively. Meanwhile, the United States sits in the #8 spot with a 105.2% ratio, and recent Treasury estimates putting the national debt at $22 trillion.

LIGHT SNOW

On the opposite spectrum, here are the 10 jurisdictions that have incurred less debt relative to the size of their economies:

Note: Small economies (GDP under $10 billion) are excluded in this table, such as Timor-Leste and Solomon Islands

Macao and Hong Kong – both special administrative regions (SARs) in China – have virtually zero debt on the books, while the official country with the lowest debt is Brunei (2.8%).

Global Pension Gap Expected to Hit $400 Trillion: US Leads the Way

The global pension gap of 8 nations is $70 trillion. The US alone is $38 trillion. By 2050 the total gap will hit $400T.

The Visual Capitalist reports The Pension Time Bomb: $400 Trillion by 2050. The above image is a small section of a huge pension infographic.

  • According to an analysis by the World Economic Forum (WEF), there was a combined retirement savings gap in excess of $70 trillion in 2015, spread between eight major economies: Canada, Australia, Netherlands, Japan, India, China, the United Kingdom, and the United States.
  • The WEF says the deficit is growing by $28 billion every 24 hours – and if nothing is done to slow the growth rate, the deficit will reach $400 trillion by 2050, or about five times the size of the global economy today.
  • In the United States, it is expected that the Social Security trust fund will run out by 2034. At that point, there will only be enough revenue coming in to pay out approximately 77% of benefits.

Worse Than You Think

Lance Roberts at Real Investment Advice added to the report in his take The Pension Crisis Is Worse Than You Think.

What follows are excerpts of Roberts’ excellent presentation, withoutblockquotes. His name will mark the end of his report.

Problem 1: Demographics

With pension funds already wrestling with largely underfunded liabilities, the shifting demographics are further complicating funding problems. One of the primary problems continues to be the decline in the ratio of workers per retiree as retirees are living longer (increasing the relative number of retirees), and lower birth rates (decreasing the relative number of workers.) However, this “support ratio” is not only declining in the U.S. but also in much of the developed world. This is due to two demographic factors: increased life expectancy coupled with a fixed retirement age, and a decrease in the fertility rate.​

…click on the above link to read the rest of the article…

Visualizing Real Inflation – A Decade Of Grocery Prices For 30 Common Items

Over the span of 2000-2016, the amount of money spent on food by the average American household increased from $5,158 to $7,203, which is a 39.6% increase in spending.

Despite this, as Visual Capitalist’s Jeff Desjardins notes, for most of the U.S. population, food actually makes up a decreasing portion of their household spending mix because of rising incomes over time. Just 13.1% of income was spent on food by the average household in 2016, making it a less important cost than both housing and transportation.

That said, fluctuations in food prices can still make a major impact on the population. For lower income households, food makes up a much higher percentage of incomes at 32.6% – and how individual foods change in price can make a big difference at the dinner table.

Only prices of three items fell: chicken breasts (-6.4%), whole milk (-7.4%), and eggs (-14.9%).

However, the average price increase for all items was 22%, buoyed especially by meats like bacon (58.2%), ground beef (44.6%), top round steak (40.6%), frozen turkey (38.3%) and sirloin steak (35.2%).

THE FUTURE OF FOOD

As we’ve previously noted, technology is being applied to agriculture and food in really interesting ways – and the future of food could be very different than what we see today.

How will the grocery prices of everyday staples be affected by growth in automated vertical farms, aquaponics, in vitro meats, and artificial animal products?

With shifting consumer preferences towards more local and sustainable products, it will be interesting to revisit this data in the coming years.

Visualizing $63 Trillion Of World Debt

Visualizing $63 Trillion Of World Debt

If you add up all the money that national governments have borrowed, it tallies to a hefty $63 trillion.

Courtesy of: Visual Capitalist

In an ideal situation, governments are just borrowing this money to cover short-term budget deficits or to finance mission critical projects. However, as Visual Capitalist’s Jeff Desjardins notes, around the globe, countries have taken to the idea of running constant deficits as the normal course of business, and too much accumulation of debt is not healthy for countries or the global economy as a whole.

The U.S. is a prime example of “debt creep” – the country hasn’t posted an annual budget surplus since 2001, when the federal debt was only $6.9 trillion (54% of GDP). Fast forward to today, and the debt has ballooned to roughly $20 trillion (107% of GDP), which is equal to 31.8% of the world’s sovereign debt nominally.

THE WORLD DEBT LEADERBOARD

In today’s infographic, we look at two major measures: (1) Share of global debt as a percentage, and (2) Debt-to-GDP.

Let’s look at the top five “leaders” in each category, starting with share of global debt on a nominal basis:

Together, just these five countries together hold 66% of the world’s debt in nominal terms – good for a total of $41.6 trillion.

Next, here’s the top five for Debt-to-GDP:

While only Italy and Japan here are considered major economies on a global scale, the high debt levels of countries like Greece or Portugal are also important to monitor.

In the IMF’s baseline scenario, Greece’s government debt will reach 275% of its GDP by 2060, when its financing needs will represent 62% of GDP.

– A recent IMF report, obtained by Bloomberg

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Every Single Cognitive Bias In One Infographic

Every Single Cognitive Bias In One Infographic

The human brain is capable of incredible things, but it’s also extremely flawed at times.

Science has shown that we tend to make all sorts of mental mistakes, called “cognitive biases”, that can affect both our thinking and actions. These biases, as Visual Capitalist’s Jeff Desjardins points out, can lead to us extrapolating information from the wrong sources, seeking to confirm existing beliefs, or failing to remember events the way they actually happened!

To be sure, this is all part of being human – but such cognitive biases can also have a profound effect on our endeavors, investments, and life in general. For this reason, today’s infographic from DesignHacks.co is particularly handy. It shows and groups each of the 188 known confirmation biases in existence.

Courtesy of: Visual Capitalist

WHAT IS A COGNITIVE BIAS?

Humans tend to think in certain ways that can lead to systematic deviations from making rational judgments.

These tendencies usually arise from:

  • Information processing shortcuts
  • The limited processing ability of the brain
  • Emotional and moral motivations
  • Distortions in storing and retrieving memories
  • Social influence

Cognitive biases have been studied for decades by academics in the fields of cognitive science, social psychology, and behavioral economics, but they are especially relevant in today’s information-packed world. They influence the way we think and act, and such irrational mental shortcuts can lead to all kinds of problems in entrepreneurship, investing, or management.

COGNITIVE BIAS EXAMPLES

Here are four examples of how these types of biases can affect people in the business world:

Familiarity Bias: An investor puts her money in “what she knows”, rather than seeking the obvious benefits from portfolio diversification. Just because a certain type of industry or security is familiar doesn’t make it the logical selection.

…click on the above link to read the rest of the article…

Visualizing The Future Of Food

Visualizing The Future Of Food

The urban population is exploding around the globe, and, as Visual Capitalist’s Jeff Desjardins explains below, yesterday’s food systems will soon be sub-optimal for many of the megacities swelling with tens of millions of people.

Further, issues like wasted food, poor working conditions, polluted ecosystems, mistreated animals, and greenhouse gases are just some of the concerns that people have about our current supply chains.

Today’s infographic from Futurism shows how food systems are evolving – and that the future of food depends on technologies that enable us to get more food out of fewer resources.

…click on the above link to read the rest of the article…

Centralized “Truth” – 13 Ways To Fight Fake News (And The Big Problem With All Of Them)

Centralized “Truth” – 13 Ways To Fight Fake News (And The Big Problem With All Of Them)

Will humans or computer algorithms be the future arbiters of “truth”?

The following infographic from Futurism sums up the ideas that academics, technologists, and other experts are proposing that we implement to stop the spread of fake news.

Below the infographic, Visual Capitalist’s Jeff Desjardins raises concerns about each of these methods.

Courtesy of: Visual Capitalist

While fake news is certainly problematic, the solutions proposed to penalize articles deemed to be “untrue” are just as scary.

By centralizing fact checking, a system is created that is inherently fragile, biased, and prone for abuse. Furthermore, the idea of axing websites that are deemed to be “untrue” is an initiative that limits independent thought and discourse, while allowing legacy media to remain entrenched.

…click on the above link to read the rest of the article…

Inside The World’s “Doomsday Vault”

Inside The World’s “Doomsday Vault”

Imagine that the unthinkable has happened. A massive asteroid impact triggers a “nuclear winter” effect, or one of the world’s most dangerous supervolcanos erupts. Maybe Donald Trump gets in an epic Twitter feud with Kim Jong-Un that initiates World War 3. Either way, things are going sideways, and the fate of human civilization itself is at stake. Will everything be lost? Visual Capitalist’s Jeff Desjardins explains…

ENTER THE ‘DOOMSDAY VAULT’

Well, besides the fact that the world’s cities have been replaced by smoking craters, there is some good news for the humans that survive a potentially apocalyptic scenario.

On a remote island that is just 800 miles (1,300 km) from the North Pole, the Norwegian government has built a failsafe in the freezing cold that protects thousands of the most vital crops from extinction. Officially called the Svalbard Global Seed Vault, it already holds close to a million samples of crops around the world, with each sample holding about 500 seeds.

Today’s infographic, from Futurism, has more on this Doomsday Vault that could one day help to save civilization:

Courtesy of: Visual Capitalist

Olduvai IV: Courage
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Olduvai II: Exodus
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