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Note this chart shows nominal dollars, not PPP-adjusted. The EU has certainly kept up with the US when looking at PPP GDP from 2008 to 2022: US grew from $14.8

• freetime2 3y ago
  Thank you. Twitter is terrible when it comes to cherry picking stats out of context.
  • tnel77 3y ago
    Ironically posted as a reply to a comment cherry picking stats.
    • freetime2 3y ago
      Fair enough - my comment complaining about the quality of content on Twitter was admittedly pretty low quality. When I said "Twitter is terrible when it comes to cherry picking stats out of context", I was referring to the fact that the Tweet doesn't link to its source, and that it only shows 2 years (instead of a line chart which would show all the years in between). It also doesn't make any attempt to interpret the data (e.g. why or what it means). I view the parent comment as adding context. They linked to the source of their data and also included their interpretation - which other people can then agree or disagree with instead of having to guess what they meant. So yes I think this is a much more constructive post than the original tweet. Note: I now see that they linked to the source WSJ article beneath the original tweet, but that was not clear to me when I made my earlier comment (and I see other people on Twitter asking about the source so it's not just me who missed it). I still think that twitter in an inferior platform for discussing nuanced topics like economics than, say, HN.
      • tnel77 3y ago
        I agree with you. It just made me chuckle :).
• dogma1138 3y ago
  No one uses PPP for measuring growth, GDP PPP can increase whilst your economy contracts. PPP isn’t a good measure for population’s wealth or quality of life especially for developed economies either. The economy of the US is still twice that of the EU and its global purchasing power has also pretty much doubled.
  • aaomidi 3y ago
    Completely depends on what you’re measuring. To me, economy isn’t an abstract thing to be measured without taking people’s quality of life into perspective. That just feels too much like stats for the sake of stats. The PPP based measurement is way more interesting.
    • dogma1138 3y ago
      Again PPP cannot by definition used to measure growth. It has limited applications for developing economies and measuring AIC which it was initially conceived. Here is a good breakdown of what it is, how it’s constructed and more importantly what it can and cannot measure. https://www.oecd.org/sdd/prices-ppp/purchasingpowerparities-frequentlyaskedquestionsfaqs.htm https://www.oecd.org/sdd/prices-ppp/purchasingpowerparities-... Regardless of how you slice it the national purchasing power of the US has doubled since 2008 whilst the EU’s has stagnated.
  • flangola7 3y ago
    We don't care about size of economy, we care about aspects of daily life of the average person.
    • _Parfait_ 3y ago
      ..Ok but we're talking about the size of the economy you do know that right? Did you read even the headline?
      • flangola7 3y ago
        The title of a headline does not dictate what I get to think and talk about. I'm not twelve.
• selectodude 3y ago
  The EU is an export-based economy, so that's great that people in the EU can drink cheaper beer and pay less in rent, but if they want to buy imports, they're absolutely poorer.
  • anonzzzies 3y ago
    Even though I can afford it, I mostly do not need new imported stuff and second hand you can get a lot of things (mostly everything besides Apple stuff) at bottom prices. Many people unfortunately dump stuff after new shiny comes out and some even give them to me for free. My iPhone was a gift from a friend who bought the latest. It’ll go for many years still. My nreal (xreal) now was a gift because another friend didn’t like it and couldn’t be bothered to sell it. But obviously I can live without these things and for vital things, like laptops, washing machines, dish washers or tvs (not really vital), they cost peanuts second hand.
    • networkchad 3y ago
      [flagged]
      • anonzzzies 3y ago
        Wasn't responding to the article, was responding to my commenting parent.
    • yourusername 3y ago
      If the new stuff gets more expensive second hand stuff that has some useful life left will become more expensive. If a new washing machine is €5000 a second hand washing machine with a year of useful life left will be €500 instead of €50. These things are not unrelated. If iPhones cost multiple monthly salaries people will substitute with cheaper options and the supply of high quality second hand phones will dry up.
• next_xibalba 3y ago
  The WSJ article [1] from which this chart is derived does account for both inflation and purchasing power when comparing incomes. [1] https://www.wsj.com/articles/europeans-poorer-inflation-economy-255eb629 https://www.wsj.com/articles/europeans-poorer-inflation-econ...
• deleted 3y ago
  [deleted]
• jcfrei 3y ago
  PPP is not a good measure for comparing the strength of different economies. The more appropriate comparison is looking at the growth in GDP with conversion to USD using the conversion rate at that time. Additionally starting in 2000 (ca. time of introduction of the euro) makes more sense than 2008. Using the data from https://stats.oecd.org/ https://stats.oecd.org/ gives you the following: EUR/USD in 2000: $0.92 EUR/USD in 2022: $1.072 US GDP in 2000: $10.25T, 2022: $23.31T, growth of 227% EU GDP in 2000: 7.86€ T, 2022: 15.81€ T(27 countries, excluding UK), converted to USD: EU GDP in 2000: $7.23T, 2022: $16.94T, growth of 234% Growth in the EU from 2000-2008 has probably (didnt crunch the numbers on this) been higher than in the US and then lower since around 2010. Also take into account that while growth has been slow (or even non-existent) in France, Portugal, Italy, Greece and Spain those countries make up less than half of the population of the EU. Eastern european countries on the other hand have grown very strongly thanks to starting from a very low base.
  • dogma1138 3y ago
    GDP figures are calculated using CID, specifically in order to prevent exchange rates from indicating false growth or contraction like you’ve demonstrated. What’s worse you’ve committed a double sin, you’ve used figures which were already normalized using the constant international dollar and applied exchange rates to them.
  • danielheath 3y ago
    Compared on the measure of “ability to produce US dollars “, the US has vastly outstripped everyone else /s
    • pas 3y ago
      others' demand for those dollars also wildly exceeded expectations!
• Amiable5326 3y ago
  [flagged]
  • esperent 3y ago
    Attack ideas, not people. I don't care who invented GDP or PPP, only if they are adequate proxies for economic strength and quality of life.
  • selimthegrim 3y ago
    Wait until you hear about who invented HDI.
  • consilient 3y ago
    Cassel was a Swedish liberal.
• junofan 3y ago
  > What that means is that the prices of goods are inflated in the US compared to similar goods in the EU. That's all. Other way round. PPP is a consumptive measure.
• throwawayggg 3y ago
  [flagged]
• metacritic12 3y ago
  Except your conclusion of US inflation being huge doesn't square out in the data: Eurozone inflation 2008 to today has been 33% US inflation 2008 to today has been 42%. This doesn't square with your implication that the US inflation is double the EUs. https://fred.stlouisfed.org/series/CPHPTT01EZM661N https://fred.stlouisfed.org/series/CPHPTT01EZM661N https://fred.stlouisfed.org/series/CPIAUCSL https://fred.stlouisfed.org/series/CPIAUCSL
• Rexxar 3y ago
  Indeed, another way to see this is that's just forex valuation change. 2008 was the peak of EUR value after subprime crises in USA. And the "nearly two times" is more like 1.60 which is explained by the value of the euro coming back from 1.6$ to the more sustainable long term value of 1$. (usd/eur chart https://www.macrotrends.net/2548/euro-dollar-exchange-rate-historical-chart https://www.macrotrends.net/2548/euro-dollar-exchange-rate-h...)
• cesarvarela 3y ago
  Technology is sold in US dollars, and prices are mostly the same globally, so yes, food has kept the same, but technology, which drives growth and innovation, is further away. i.e., the Apple Vision Pro will cost twice as much (in GDP terms for what it is worth) to Europeans, reducing the chances of the next big company building on it to be located in Europe.
• fhe 3y ago
  I have always wondered to what extent GDP (price-adjusted or not) reflects standard of living. By different sources, GDP per capita for Britain is only 60% that of the US, but visiting these two countries I don't see much of a difference in standard of living.
  • jltsiren 3y ago
    If you make $50k/year and work for living, you are probably middle class. If you make $250k/year and work for living, you are probably still middle class. That's more or less the same thing. Differences in income have a surprisingly small effect on quality of life. If you make more money, you can still afford the same luxuries. Just more of them and more often. You are likely buying bigger and better versions of fundamentally the same things. You probably spend your money less efficiently, buying all kinds of minor conveniences. And if everyone around you makes more money, your expectations go up, and your spending will be even less efficient.
• sieabahlpark 3y ago
  [dead]
• woliveirajr 3y ago
  Why not use the price of BigMacs and how many an average worker can buy?
• unstatusthequo 3y ago
  Nobody believes China’s numbers, anyway. Take whatever they say and halve it. Then multiply by 1/3 of pi. Or pick a random number you like from roulette. Any of those could be more accurate than China’s actual numbers.
• frankreyes 3y ago
  $1 is still $1 when for example you travel to another country or buy stuff online. Just like CPI, PPP is biased to an average and meanwhile the extremes are getting worse. The poor are getting poorer and the rich, richer. If you have zero bananas and I have two, on average we have 1 each.