Follow up on vehicle data

Lots of global news today. First, what is happening with India-Pakistan? Why is no one talking about this, or at least not enough. These are nuclear-power states with long-time conflicts. Nothing has worked to de-escalate the recent flare up, and it sure doesn’t look like there is any adults in the room. It doesn’t help that the US has basically taken itself off the world stage since Trump took over. Where are the US diplomats speaking out about this, trying to help the situation. Of course, Trump himself is in Vietnam for the Kim summit, plus his former consigliere/fixer is testifying in front of the US Congress about all of the bad things that he did at the direction of Trump.

While I do not think that Trump is a good president, I believe he has not been as bad as George W. Bush was. Remember, W presided over 9/11, started the war in Afghanistan and quickly forget about it, started the war in Iraq without a plan, was responsible for Hurricane Katrina response, and ended his term with the worst financial crisis since the Great Depression. While Trump hasn’t been innocuous, he hasn’t done that much, and some of the things he has done (like upsetting allies, pulling out of treaties) could be rectified over time.

But now, we have a potential global emergency, and the US State Department and the Pentagon have put out bland statements or made calls to counterparts that doesn’t seem to have done much (yet, to be fair).

We really seem to be moving out of the Pax Americana and into a new world order, with no country really able to take leadership of scary situations. Maybe this will change with a better US president, or maybe China will step in at some point (don’t count on that). But it is not great.

Outside of commenting on that, I just wanted to do a little bit more work on how true it is to say that vehicle sales grow with GDP. I expanded the chart from yesterday to include all countries for which we have data - 134 in total. That’s a good amount of data. Looking at the chart, and it sure seems like the data fits - up and to the right. So more X (GDP per capita) means more Y (vehicle sales per 1,000 people).

The regression also works with a very high adjusted R-squared of 0.76 and tiny P-values for the X-variable. No surprise here. It would have been more surprising if it had not worked, but that’s what you get sometimes.

VEHICLE SALES SEEM TO TRACK PRETTY WELL WITH GDP PER CAPITA. THE MORE OF ONE, THE MORE OF THE OTHER. SOURCE: WORLD BANK, OICA, VIETECON.COM