Does drought cause suicide - No statistical evidence to suggest that at all

Every day in the newspapers and on talk back radio there are tales of suicide in rural Australia due to the drought. These claims seem to be accepted as facts, rather than being challenged.

I would have thought that if drought was causing increased suicides we would see them in the ABS causes of death statistics in those drought years.

So I pulled out my trusty stats, and, using Dubbo average rainfall from the BOM as a proxy for drought, looked for drought years. I have defined drought years as daily average rainfall that is 2 Standard Deviations from the 30 year average. This produced the following list of drought years, and the equivalent difference from the 30 year average suicide rate (which is 12 per 100,000 people). Suicide rate was from the ABS causes of death release

So based on my analysis, I have drought years being 1982, 1997, 2002, 2006 and 2018. These years (googled) all appear to have been classified as drought.
So if I run a regression on this to see what the trends are, I get the following stats.

So what does this say. Well, there is no statistical increase from the 30 year average suicide rate in drought years. If anything, both the trend and the drought affect seem to reduce the suicide rate, not increase it.

So can we stop this "drought causes suicide" line please? It doesn't.

Is WiseTech really that shit? Not really, but it is a predator.

Wise Tech has been in the news a bit after analysts have released some research saying it is overstating its income. Hard to really say that for mine. But there is no doubt there are some irregularities.

Firstly, the capitalisation of R&D expenses...over the last 2 years Wise Tech has capitalised the R&D by around $80 million. If those expenses were expensed in the P&L instead, you would have reduced the NPAT over those 2 years from $101 million to $20 million. Meaning that the return on Equity would reduce from 9% to 1.8% with a dividend payout ration of around 15%, that means organic growth would only be around 1.5% Not much debt happening so the rest would be acquisition of businesses via share placements. And you do see that in the accounts. Share Capital has gone from $166 million in 2017 to $668 million in 2019.

Then we also have the Goodwill impairment. Goodwill Balance at the moment is $600 million...basically 53% of total assets. That is high historically for IT companies which generally have a 15-20% Goodwill/Asset ratio.

Yet Goodwill is only being impaired at the rate of $63,000 a year. I think that is a big call. Needs to be higher than that for mine (even 1% would mean 6 million removed from Profits). So I would expect a greater than average impairment charge coming down the tubes.

Lastly, Wisetech has recently changed its revenue recognition (in 2018). Previously it operated as follows

"Revenue is recognised for the major business activities as follows:

Recurring monthly and recurring annual software usage revenue

Revenue is recognised as the services are provided to the customer. Under our “On-Demand Licences”, customers are charged monthly in arrears based on their actual usage. On-Demand licences comprise STL (Seat Plus Transaction Licensing) and MUL ( Module User Licence). Maintenance revenues associated with OTL (One-Time Licence) are classified for presentation purposes as recurring monthly and recurring annual software usage revenue. Annual revenues from OTL maintenance revenues are recognised evenly over time as services are rendered. OTL and support services OTL and support services are recognised when the licences are provided and the services are delivered."

In 2019

Revenue recognition approach Recurring On-Demand Licence revenue

The majority of revenue is derived from recurring On-Demand Licences, where customers are provided the right to access the Group’s software as a service, without taking possession of the software. These arrangements include the ongoing provision of standard customer support and software maintenance services. Revenue is recognised over the contract period and is based on the utilisation of the software (numbers of users and transactions). Customers are typically billed on a monthly basis in arrears and revenue is recognised for the amount billed.

Recurring One-Time Licence (“OTL”) maintenance revenue

Additional recurring revenue is derived from the recurring maintenance fees charged to customers on OTL arrangements and is recognised over time during the maintenance period. OTL revenue and support services OTL fee revenue is derived when the Group sells, in a one-off transaction, the perpetual right to use the software. This licence revenue is recognised at the point in time when access is granted to the customer and the one-off billing is raised."


No major changes there, though it is more specific. But the red flag is that it hasn't restated its earnings so impossible to say if this change is detrimental. But it does give some insight into the business model of WiseTech which appears to be as follows.

1. Purchase competing IT platforms in the logistics space, using shares to fund those acquisitions.
2. Migrate users of these platform to CargoWise One platform and new licencing model based on users and transactions (hence able to drive revenue growth when the companies increase their use of the platform), rather than one-time licences which is the old way of operating
3. Rinse and repeat.

Can it continue? Well, if it can keep ahead of any new competitors, maybe. But if it has to pay over the odds for platforms and that Goodwill balance keeps increasing, it may have issues in the future.

Happiness vs GDP

Happy Countries are Rich Countries. I gathered the figures from the UN sustainability report.

So every decrease in GDP Per Capita Rating, reduces the happiness rating by around 20%.


Note any countries above the line are less happier than they should be. Those below are happier than they should be. Somalia is an interesting one.