Economic Rigor

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 th...

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 I...

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.

My favourite ABS release, Causes of death, was released today with 2018 figures. Always like having a look at what kills us. Anyway, with all this talk of Climate emergencies and extinction events or the like, it is always interesting if we are seeing any of that in the figures. Well, as you might expect, not really. Death rates over the last 20 years have actually reduced from 757 deaths per 100,000 in 1997 to 507.9 deaths per 100,000 in 2018. And the deaths from weather are tiny. Average yearly deaths from Excessive Cold (1997-2018) = 18 deaths Average yearly deaths from Excessive Heat (1997-2018) = 13 deaths It is true that Excessive Heat deaths are increasing, but at a rate of 0.54 deaths a year. So in 100 years, there will be an extra 54 deaths from heat. But to counter that, Excessive Cold deaths are decreasing at a rate of -0.23 deaths a year. So in 100 years, there will be 23 less deaths from Cold. So all up in 100 years, climate change will have caused a...

With all the climate strike going on, people are pointing at the drought in North west NSW as a reason to de-carbonise due to Climate Change. So as always, I put my devils advocate hat on, downloaded some data from the BOM from a weather station close to Tamworth and had a look. So is the average rainfall in Tamworth worse as the climate has heated up? Not really. Been bad the last couple of years, and probably the worst drought since 1994, but overall, rainfall has actually increased since 1903 What about the number of rain free days? Actually decreasing since 1903 So this says more about preparation for drought than anything else. Maybe there should be more dams.

Following my theme of "Does the hype of Climate Change match the stats", I give you the Total Fire Ban days in Victoria, Australia. With all the talk of climate risk etc, you would think that the Total Fire Ban days are getting a lot more plentiful. Well lets see. Downloading data from the CFA in Victoria, one of the few agencies that publish data on this, we have the following since 1945. 30 year average is 10 days a year at the moment. There is a fair bit of volitility here...It does show an increase, but the increase is basically 1 extra TFB day every 10 years...So to get to an average of 20 days, its going to take 100 years. Something to watch, but not to panic about.

With all the talk of impending Climate doom in Australia, you would expect to see major increases in heat extremes over the various years hitting all Australia cities But while the average temperatures are increasing over the years, you don't see a lot of heat waves. To confirm, I downloaded some data from the ACORN network from  the BOM, for max temps since 1910 or so. In most of the cities, there isn't a lot of movement in the number of > 35 degrees Celsius days For example in Melbourne, the 30 year average (1981-2010) of days of the year over 35 degrees is actually around 9. And its only growing at 0.005 days a year on the trend. Based on that, it will be another 200 years before the average rises to 10 days. In Sydney, the 30 year average of days over 35 is 4.5. And only growing at 0.002 days a year, over the trend). Again, it will be 500 years before average goes 5.5. Brisbane, for all the talk of extreme heat is pretty benign in general. Less than 1 ...