Manufacturers Love US & Mexico

Forbes writes that "Manufacturing cost competitiveness for both the U.S. and Mexico improved substantially between 2004 and 2014 compared with 25 major world exporters. Productivity-adjusted wages and currency rates have remained stable or improved relative to the other countries, making the U.S. and Mexico prime real estate for new assembly plants.  Both nations also have very competitive energy costs thanks to new oil and gas discoveries in the U.S."

The article is based on a new study by Boston Consulting Group, titled "The Shifting Economics of Global Manufacturing". The results of the study are sobering for Western Europe: "Manufacturing costs in most of Western Europe were relatively high a decade ago, and cost competitiveness has weakened considerably in several countries. Average manufacturing costs in Belgium rose by an estimated 7 percent compared with those in the U.S. They rose by 8 percent in Sweden; 10 percent in France, Italy, and Switzerland; and 21 percent in Australia." However as Europe keeps losing ground the USA and Mexico are the new darlings of manufacturers:

Income Inequality Is Not Rising Globally. It's Falling.

Tyler Cowen writes in the New York Times: "Income inequality has surged as a political and economic issue, but the numbers don’t show that inequality is rising from a global perspective. Yes, the problem has become more acute within most individual nations, yet income inequality for the world as a wholehas been falling for most of the last 20 years. It’s a fact that hasn’t been noted often enough."

Global Supply Chain Vulnerability

From Bloomberg

US is Rising Star for Manufacturing

The Shifting Economics of Global Manufacturing from The Boston Consulting Group

The "Most Important Book Ever" Is All Wrong

On Bloomberg View, Clive Crook takes a sobering look at Piketty's "Capital in the Twenty-First Century": "It's hard to think of another book on economics published in the past several decades that's been praised as lavishly as Thomas Piketty's "Capital in the Twenty-First Century." The adulation tells you something, though not mainly about the book's qualities. Its defects, in my view, are greater than its strengths -- but the rapturous reception proves that the book, one way or another, meets a need."

So what is the problem with "The Most Important Book Ever"?: "Quite a few things, but this to start with: There's a persistent tension between the limits of the data he presents and the grandiosity of the conclusions he draws. At times this borders on schizophrenia. In introducing each set of data, he's all caution and modesty, as he should be, because measurement problems arise at every stage. Almost in the next paragraph, he states a conclusion that goes beyond what the data would support even if it were unimpeachable."

The Mises Economic Blog summarizes neatly what's wrong with the book and with its idolizers: "In 1936, a dense, difficult-to-read academic book appeared that seemed to tell politicians they could do exactly what they wanted to do. This was Keynes’s General Theory. Piketty’s book serves the same purpose in 2014, and serves the same short-sighted, destructive policies. If the Obama White House, the IMF, and people like Piketty would just let the economy alone, it could recover. As it is, they keep inventing new ways to destroy it."

Private Equity Performance

From McKinsey&Company: "Private-equity performance has been misunderstood in some essential ways. It now seems that the private-equity industry decisively outperforms public equities with respect to risk-adjusted returns, which may prompt return-starved institutional investors to allocate even more capital to the asset class. But this good news comes with an asterisk: top private-equity firms now seem less able to produce consistently successful funds. That’s because success has become more democratic as the general level of investing skill has increased."

Manufacturing in the USA

Manufacturing Innovation Blog: "This infographic tells the story of manufacturing.  It shows how manufacturing enables our everday lives, drives our economy, offers many different rewarding careers, and what can happen when communities across the country come together to show the public what manufacturing is…"