"Economists and
investors alike are looking at the GDP number as a way to understand whether
the economy is growing and by how much. However not all GDP is created equal.
It is important not only to look at the GDP but also to look at where it's
coming from to assess its quality. Take, for example, the following two
neighbors. One is a hard working immigrant that earns 100,000 in annual income,
but lives in a simple home and is saving 40%of his income for retirement, his
children's education and to have cash available for any future business
opportunity that may come his way. His neighbor is in the public sector also
earns 100,000 per year however he just took on a mortgage to purchase a brand
new home for 800,000 and between credit cards is living on 135,000 per year
(Spain 2000-08)."
http://boombustblog.com/blog/
http://boombustblog.com/blog/
