Putting IMF's PPP GDP to the test

[Martian2]

Gardner 2015 World Machine Tools Consumption

Machine Tools are just as important as industrial robots. Machine Tools enable the construction of high-tech products, because tight tolerances and machine-tool perfection are achievable.

As you can see in the Gardner 2015 World Machine Tools Consumption chart, China is once again #1 and the US is a distant #2. This reinforces the assessment that China has a bigger and possibly more sophisticated economy than the US.

Original data from Gardner: 2015 World Machine-Tool Output & Consumption Survey | Gardner Research

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Looking at four important factors in determining the size of a country's economy, most people would say that China is #1. The US is #2. However, how can the IMF justify claiming that India is #3? India is not ranked #3 in any of the four important factors that affect the size of a nation's economy (or output).

 

[Bussard Ramjet]

Gardner 2015 World Machine Tools Consumption

Machine Tools are just as important as industrial robots. Machine Tools enable the construction of high-tech products, because tight tolerances and machine-tool perfection are achievable.

As you can see in the Gardner 2015 World Machine Tools Consumption chart, China is once again #1 and the US is a distant #2. This reinforces the assessment that China has a bigger and possibly more sophisticated economy than the US.

Original data from Gardner: 2015 World Machine-Tool Output & Consumption Survey | Gardner Research

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Looking at four important factors in determining the size of a country's economy, most people would say that China is #1. The US is #2. However, how can the IMF justify claiming that India is #3? India is not ranked #3 in any of the four important factors that affect the size of a nation's economy (or output).

Why is the China machine tool consumption and production declining?

 

[Martian2]

Why is the China machine tool consumption and production declining?

Two possibilities.

1. The total stock of Chinese machine tools has reached saturation. Thus, China could be moving towards replacement level of machine tools.

2. The world economy slowed in 2015. This engendered less demand for machine tools.

 

[Bussard Ramjet]

Two possibilities.

1. The total stock of Chinese machine tools has reached saturation. Thus, China could be moving towards replacement level of machine tools.

2. The world economy slowed in 2015. This engendered less demand for machine tools.

Yes, but look at the top 5, except Germany and China, all the rest are growing their consumption.

 

[Martian2]

Yes, but look at the top 5, except Germany and China, all the rest are growing their consumption.

That's easy to explain.

No stimulus in China.

Loose Fed policy in the United States and interest rates near zero.

No stimulus in Germany.

Japan has devalued its Yen from 75 to 125 per US Dollar in three years. Thus, it will pick up marginal orders and need a few extra machine tools.

South Korea has loose monetary policy too and a somewhat depreciating currency (because it's all relative).

South Korea says to continue with easy monetary, fiscal policy | Daily Mail Online

Korea: Korean won depreciates | FocusEconomics
"Korean won depreciates
September 17, 2015

In September, the Korean won (KRW) continued to weaken against the U.S. dollar, prolonging the depreciating trend that has been in place since May. On 7 September, the currency traded at KRW 1,204 per USD, which was the weakest value since May 2010. The reading was 3.1% weaker than the level observed on the same day of the previous month and 17.5% weaker than the level in the same month last year."

In conclusion, China and Germany do not fit the trend because they have massive trade surpluses. They don't have massive stimulus programs, near-zero interest rates, or a rapidly depreciating currency.

 

[Martian2]

Euromonitor International says China's 2014 automotive market is almost 8 times larger than India's

Key Automotive Industry Insights for 2015 (slide 4 of 15)

The general consensus is that China's real economy is a little bigger than the United States. This means the IMF PPP GDP for China and the United States are correct.

China (23.5 million light-vehicles purchased annually) buys more light vehicles (ie. cars, SUVs, and light trucks) per year than the US (17 million). Aside from houses, light vehicles are the most expensive consumer items. The total number of light vehicles purchased per year is a pretty good proxy for the size of an economy.
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Once again, the data shows that India is not ranked #3. Thus, the IMF is dead wrong in proclaiming India as the world's third largest economy. The automotive sales data from Euromonitor International disagrees with the IMF claim.

The current tally shows China is #1 in four out of five important economic categories. The United States is #1 in one out of five important categories and #2 in three out of five. The United States is solidly the world's number two economy.

There should be little dispute that China is the world's largest economy and the United States is a solid number two.

However, India is not #3 in a single important economic category. It is always a distant laggard. Thus, the IMF is clearly wrong in putting India in the number 3 position for PPP GDP. In actuality, the Indian PPP GDP most likely falls behind Japan and Germany.

My current list of real GDP is as follows:

1. China
2. United States
3. Japan
4. Germany
5. Not sure whether it's Russia, France, Britain, India, or Brazil

 

[Beidou2020]

Euromonitor International says China's 2014 automotive market is almost 8 times larger than India's

Key Automotive Industry Insights for 2015 (slide 4 of 15)

The general consensus is that China's real economy is a little bigger than the United States. This means the IMF PPP GDP for China and the United States are correct.

China (23.5 million light-vehicles purchased annually) buys more light vehicles (ie. cars, SUVs, and light trucks) per year than the US (17 million). Aside from houses, light vehicles are the most expensive consumer items. The total number of light vehicles purchased per year is a pretty good proxy for the size of an economy.
----------

Once again, the data shows that India is not ranked #3. Thus, the IMF is dead wrong in proclaiming India as the world's third largest economy. The automotive sales data from Euromonitor International disagrees with the IMF claim.

The current tally shows China is #1 in four out of five important economic categories. The United States is #1 in one out of five important categories and #2 in three out of five. The United States is solidly the world's number two economy.

There should be little dispute that China is the world's largest economy and the United States is a solid number two.

However, India is not #3 in a single important economic category. It is always a distant laggard. Thus, the IMF is clearly wrong in putting India in the number 3 position for PPP GDP. In actuality, the Indian PPP GDP most likely falls behind Japan and Germany.

My current list of real GDP is as follows:

1. China
2. United States
3. Japan
4. Germany
5. Not sure whether it's Russia, France, Britain, India, or Brazil

I agree with your list.

My list is:
1. China
2. United States
3. Japan
4. Germany
5. France
6. Britain
7. Brazil
8. Russia

 

[TaiShang]

I agree with your list.

My list is:
1. China
2. United States
3. Japan
4. Germany
5. France
6. Britain
7. Brazil
8. Russia

Russia's economy is projected to move to growth area next year, somewhere above 1%.

Do you see this as likely?

Euromonitor International says China's 2014 automotive market is almost 8 times larger than India's

Key Automotive Industry Insights for 2015 (slide 4 of 15)

The general consensus is that China's real economy is a little bigger than the United States. This means the IMF PPP GDP for China and the United States are correct.

China (23.5 million light-vehicles purchased annually) buys more light vehicles (ie. cars, SUVs, and light trucks) per year than the US (17 million). Aside from houses, light vehicles are the most expensive consumer items. The total number of light vehicles purchased per year is a pretty good proxy for the size of an economy.
----------

Once again, the data shows that India is not ranked #3. Thus, the IMF is dead wrong in proclaiming India as the world's third largest economy. The automotive sales data from Euromonitor International disagrees with the IMF claim.

The current tally shows China is #1 in four out of five important economic categories. The United States is #1 in one out of five important categories and #2 in three out of five. The United States is solidly the world's number two economy.

There should be little dispute that China is the world's largest economy and the United States is a solid number two.

However, India is not #3 in a single important economic category. It is always a distant laggard. Thus, the IMF is clearly wrong in putting India in the number 3 position for PPP GDP. In actuality, the Indian PPP GDP most likely falls behind Japan and Germany.

My current list of real GDP is as follows:

1. China
2. United States
3. Japan
4. Germany
5. Not sure whether it's Russia, France, Britain, India, or Brazil

***

China auto sales hit monthly record high
Xinhua, December 10, 2015

Automobile sales and output in China both hit record highs in November as demand continued to recover on government support policies, industry data showed Thursday.

China's automobile sales jumped 20 percent year on year to 2.51 million vehicles in November, while output rose 17.7 percent from a year earlier to 2.54 million, the China Association of Automobile Manufacturers (CAAM) said in a statement.

For the first 11 months of the year, 21.8 million vehicles were sold, up 3.3 percent year on year. Production was about the same level, up 1.8 percent from a year earlier.

Passenger car sales grew rapidly in November, while Chinese-branded passenger cars took a larger share of the market with sales soaring 26.9 percent year on year, the CAAM said.

The automobile market cooled in the early months of 2015 as a result of the economic slowdown, fierce competition and purchase limit policies in first-tier cities. But both sales and output rebounded in October due to reduced purchase taxes.

China's vehicle-purchase tax was halved from 10 percent to 5 percent for low-emission passenger vehicles, effective from Oct.1, 2015 to Dec. 31, 2016.

 

[Martian2]

China was #1 in adding industrial robots for 2014

Industrial robots are a huge boost to productivity and quality. When functioning properly, industrial robots are virtually perfect. Also, industrial robots are incredibly productive.

China purchased and installed the most industrial robots in the world for 2014. The United States was #4. By the way, China (262,900 total industrial robots for year 2015) has more total installed industrial robots than the United States.

India will add about 2,600 industrial robots this year. India ranks among the lowest-tier countries in adding industrial robots. India's total installed base is 14,300 industrial robots.

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2014 was another record year for robotics | The Robot Report - tracking the business of robotics

 

[Shotgunner51]

China was #1 in adding industrial robots for 2014

Industrial robots are a huge boost to productivity and quality. When functioning properly, industrial robots are virtually perfect. Also, industrial robots are incredibly productive.

China purchased and installed the most industrial robots in the world for 2014. The United States was #4. By the way, China (262,900 total industrial robots for year 2015) also has more total installed industrial robots than the United States.

India will add about 2,600 industrial robots this year. India ranks among the lowest-tier countries in adding industrial robots. India's total installed base is 14,300 industrial robots.

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2014 was another record year for robotics | The Robot Report - tracking the business of robotics

Nice work bro! I suppose you are gauging real economy am I correct? If that's so might add steel (fundamental for most industries) and concrete (used in infrastructure, city building) production. Also on tech progress, maybe stats like patent counts or industrial design reg from WIPO are more objective than any judgemental indices made by panels of selected people.

 

[slng]

infrastructure and accessibilities should be part of it too.

 

[Shotgunner51]

infrastructure and accessibilities should be part of it too.

Yes, say expressways, rail, ports, power grid, data grid, etc. "Building" the country not just sounds like a good slogan, it literally means creating real tangible "built assets" for the country.

Arcadis Global Built Asset Wealth Index 2015

China now has a built asset wealth of US$47.6 trillion, overtaking the USA which comes in second place with a wealth of US$36.8 trillion. Since 2000 China has invested US$33 trillion in its built assets, a total that exceeds all other economies combined. The growth is evidence of China’s unprecedented level of investment in its infrastructure – 9% of GDP – which outpaces global competitors like the USA, which currently invests just 2%.

SOURCE: PENN WORLD TABLES, IMF, WORLD BANK WDI, NATIONAL STATISTICAL AGENCIES, CEBR ANALYSIS
FIGURE 1: STOCK OF BUILT ASSETS, 2014, US$​

Qataris replace Singaporeans as the richest built asset population, with a built asset wealth of US$198,000 per capita compared to US$192,000 in Singapore, US$160,000 in China Hong Kong SAR at 3rd. China Mainland ranks #24 in the world at US$34,137 and is expected to continue fast growth.

SOURCE: PENN WORLD TABLES, IMF, WORLD BANK WDI, NATIONAL STATISTICAL AGENCIES, CEBR ANALYSIS
FIGURE 2: BUILT ASSETS PER CAPITA, US$​

 

[badguy2000]

usa overtook uk and became the largest industry powerhouse in the world in 1894.
However, USA was not admitted to be the most powerful country until 1945,


China now is like USA during 1894-1945.

 

[AndrewJin]

@Martian2 Great thread again!
US, China, Japan, Germany and SK are the real players I think, they are actually designing and making things, the remaining less important.

 

[Martian2]

International Federation of Robotics (IFR) says China has 1/4 of world industrial robots.
China will have 1/3 by 2018.

China is adding more industrial robots and at a faster pace than any other country in the world.

In the past, when wages rose, jobs were moved to lower-cost countries. That is no longer the case.

Today, China is installing industrial robots. Industrial robots are far more productive than human workers. At one Chinese factory, 650 employees were reduced to 60 (see second citation below). Industrial robots replaced the other 590 workers.

Another Chinese company used 80 industrial robots to replace 2,000 human workers. (See third citation below)

'Workshop of the World' China Bets on a Robot Revolution - NBC News

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Chinese factory replaces 90% of humans with robots, production soars - TechRepublic

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Robots Gain Bigger Foothold In China | Computer Stories