This is 2020, and as I am sure most of you are aware it will soon be coming to an end.
The end of a year, especially one as trying as this is always a good time to reflect and
get yourself ready for the next trip around the sun.
And what better way to look back, then to focus on every little mistake that the comment
section so kindly pointed out for you. That’s gotta build up that holiday cheer.
But in all seriousness, it is always important to highlight area’s where things can be
improved, explained better or corrected especially in a situation where so many people tune in
twice a week to listen to mr economics man talk about whatever it is he decides is interesting.
So welcome to all of the mistakes that Economics Explained made in the year 2020.
We will be breaking this video down into 3 main categories.
Minor issues, caused by simple human error.
Issues that could potentially cause confusion
And yes even a few major issues that do need to be corrected so that we may sleep at night
knowing all of our wonderful viewers are learning all
of
the
right things.
Intro Add.
So what better way to get stuck into this video than to address the most recent, most
glaring and most commented on mistake I made in 2020.
In the video on the economy of Cyprus we were exploring how the nation had effectively been
selling passports to wealthy global millionaires and billionaires, which gave these unscrupulous
individuals access to all of europe thanks to Cryprus’s membership in the EU.
unfortunately, it turns out that Cyprus only has Mebership in the EU, which is not a word,
and definitely does not grant any special working permissions to passport holders.
A similar oopsie happened in our video on Cyberpunk 2077 where we gave Night City a
rather dismal score on the economics explained leaderboard only for them to turn the bad
news around with a surprise boost in editing that took their final score from a sup par
5.6 to a respectable 7.2.
The screen numbers not matching up with my mouth numbers was also an issue in our video
on south africa where we were comparing income GINI co-efficients and said this.
Another on screen woopssy that was a bit more embarrassing was in our video on Gross Domestic
Product and why it was overrated, where we also explored gross national product which
is an alternative measurement that includes foreign business operations. Gross National
Product is a very useful tool, but unfortunately I have no idea what gross nantional product
is so oh well.
Jumping from our most recent videos right back to the beginning of the year we released
a video on Germany and in discussing the construction the autobahn we showed this clip here. Which
is a bridge that is not in germany. This is particularly embarrassing considering that
this bridge is actually in Norway, so I definitely should have known better.
The other thing about this video is not a mistake per say but it did sound like the
narrating was being delivered by Busta rhymes. To show you what I mean, this audio has not
been sped up.
Fortunately these days Economics Explained has a full-time Audio Engineer who’s sole
job is to make my loverly Australian accent sound as smooth and silky as a lullaby.
Now going back to ill-informed footage selection just a few weeks later I made that minor slip
up over german highways look trivial when I said this.
Yeeeaaahhh noooo, that is actually turkey. If the world-famous blue mosque was not enough
of a giveaway perhaps the huge body of water in the background should have been given it
is something that Iran’s capital city famously lacks.
This led to absolutely the most hilarious comment section ever as I got very rightfully
grilled over and over and over again about this terrible mistake.
And you might have though I would have learnt my lesson at that point but nope, a few months
later,
Errr nope that is a Spanish town that just so happens to have a Jesus statue. Turns out
that guy is pretty popular worldwide.
Now fortunately there hasn’t been any footage mishaps quiet that bad since, but there were
still plenty that probably flew under the radar.
This is the university of Neirobi in Kenya, not south africa. This is estonia, not finland,
This is in Malaysia, not south korea and this is in the pantheon which is not in the vatican.
Oh and, hong kong made it to the top of the economics epxlained leaderboard, not hong
hong.
Apparently flag’s have caused some issues too but this still confuses me. The first
one was this flag of the United Kingdom, which many many comments said was upside down. But
I still don’t get this one, the union jack is symmetrical, you can flip it either way
and its all the same.
I think people might have meant it was being blown from right to left on screen but hey
don’t blame me for the wind.
Another common flag complaint is that this was the flag of ireland and not the flag of
italy. Well 2 things here, firstly, all yall nations out there need to stop with the three
vertical stripes, it gets very confusing. The second this is that yeaaaahhh, this is
kinda orange looking I will give you that, buuuutttt, the background is very obviously
italy. But I could see how it would be easy to get confused.
This segues us nicely on to our next set of mistakes which could
Cause confusion
So far all of these mistakes have been simple errors that anybody could tell was just a
human slip up or oversight, not great I will admit, but it’s not going to do any harm
to anybodys understanding of economics, although there were a few problems that we found that
may.
In our video on tesla there were two such issue’s. The first and largest was that
we said that the company was unprofitable for a select group of years. Now this was
technically true, and we even put a little disclaimer on screen, but tesla has turned
a profit now in a few consecutive quarters.
And while they havent reported a full financial year with a profit it was unfair of us to
say it was a profitless company, so sorry about that, especially to people who listen
to economics explained on spotify and would not have been able to see our on screen disclaimer.
The next mistake in this video is that I said there were only 3 models in the Tesla Lineup
currently. The model S, 3 and X, which is not true because there is also the model Y
that is for sale in a few countries. My only defense of this one is that the model Y is
not available in australia yet and I should have done my research better.
Speaking of which, in that same video we were exploring vertical and horizontal integration
in manufacturing and I used the example of the Volkswagen group building a Bentley, porsche,
lamborghini, audi and volkswagen on the tiguan platform, where these cars are actually built
on the Toureg platform.
I like to consider myself a car guy so this whole video was not my finest hour.
Similarly in our video on brazil we were looking at how geography had caused some major issues
for the nations industrial potential over the years and I said that the whole country
is covered in the amazon rainforest. In reality Brazil is absolutely massive and only 60%
of its landmass is taken up by the amazon.
Another confusing remark came out in our most recent video on Cyprus where we were looking
at Saxo bank’s prediction that the other Amazon would purchase the Island nation to
use as their very own little tax shelter. I said that saxo bank was a small investment
firm, when in reality they are one of the biggest investment banking groups in europe.
Now speaking of misleading many people complained that our video on the economics of prisons
wasn’t actually a video on the economics inside prisons, but rather it was on the prison
industrial complex.
To clear this up we have now changed the name of that video but sorry for those of you who
wanted a deep understanding of the exchange rate between keestered cellphones and ramen
packets.
Although to make it up to you if this video gets ten thousand likes I will make a video
on the economy within prisons.
however I am relatively confident we won’t reach that because perhaps another mistake
was actually making this video at all. To date, the video on Economics Explaineds mistakes
of 2019 is the least viewed video on this channel… sooo why am I making another one?
Well some might say it’s a valiant pursuit of academic integrity and some might say I
needed an easy video to write and edit whilst recovering from all the food I ate on Christmas
Day. thats up to you to decide.
Oh and speaking of self-serving a fair few of you have asked why I like all of my own
video’s, and the reason is, well I really don’t know. The first video I liked myself
was my video on the economy of EVE online, which was the first video on this channel
to really take off and ever since then it’s almost been a superstition.
With this, we should now look at a few things that we got
just plain wrong.
This is the most important part of the video because if you do watch this channel to learn
things it’s really important you learn the right things and to ensure that is always
the case we have to be able to admit that we got something wrong so it can be corrected.
I will start with our video on the Financial Independance Retire Early movement.
The central concept of this idea is that people should be able to save and invest enough money
to live comfortably off their portfolio returns without the need to earn an income from traditional
employment. The FIRE movement simplifies how much you
need to save an invest into a rule where if you can live of 4% of your portfolio’s value
you can theoretically live forever without running out of money based on historical returns
and inflation rates.
In our video I said the rule was 3% which was a much more conservative figure normally
used by a group that identifies as FATFIRE.
FAT FIRE is just like the traditional crowd that want to achieve financial independence
but they also want to live a life of luxury without making the usual sacrifices needed
to save a large portion of a modest income.
For this reason, people in this niche of the FIRE movement tend to target very high paying
fields of work and normally seek to live off of three percent of their net worth because
that means that their incomes will grow over time even in retirement.
If someone has 10 million dollars invested and the market makes a 7% average return,
that person would be $700,000 richer, if inflation averages 2% it means in reality the real value
of that portfolio has only increased $500,000, if you add a 1% margin of error that means
you have your typical 4% rule and you can live happily ever after.
Although if you drop that down to a 3% rule, not only do you have even more safety that
your investments will be able to fund your lifestyle forever but you also have tha ability
to re-invest an extra $100,000 per year. Which means that your portfolio will be worth an
extra million dollars every 7 years thanks to more compound interest.
So there we go we can use a mistake as a learning opportunity, but the takeaway should be that
3% rule is very conservative and by no means the consensus amongst the financial independence
crowd.
Another point that was just plain wrong was when we were looking at the economics of Brexit
and said that there was some major turbulence caused in europe in 1991 after the re-unification
of germany, when in fact Germany was re-unified a year earlier in 1990.
And finally in one of our most popular video’s of the entire year we looked at how the Chinese
economy would benefit from the dumpster fire of 2020. In this video we were looking at
how china was investing into up and coming African nations as a way to generate returns
and also spread influence.
We said that through a practice of putting countires into unserviceable debt and then
reposessing public assets china had been able to claim Kenya’s largest shipping port in
Mombassa, which was wrong. The port of Mombassa is still very much owned by Kenya’s port
authority, although there was a time where it looked like it could go either way.
What we should have said is that a chinese state owned multinational or more specifically
China Merchants Group owns the port of Djibouti, and even then their ownership is very much
divided and contested with the state.
This is not to say debt trap diplomacy is not real, but these were not the right examples
of such policies.
Now I am sure there are hundreds of other mistakes out there, and we have made a mistake
by not picking up on them for this video. But ce la vix, I am also sure that the comments
section will kindly point them all out which is great. It will give us a list to work off
for this video next year.
Ranking
Alright why not lets put all those comments to rest asking for the economics of economics
explained by putting the economy of economics explained on the economics explained leaderboard.
Starting with size, well the whole thing is basically run by 3 people, we don’t have
any international trade deals and we import basically all we consume. So with a GDP of
effectively zero that’s really all I can give it as a score.
GDP per capita on the other hand should be pretty good, just by virtue of the fact that
Australia and the USA where we all live are advanced economies it gets an 8/10.
Stability and confidence. Hmm well if this video is anything to go be we certainly are
not a perfect little Switzerland, but we also arent the infographics show so lets give it
an even 5/10.
Growth has been crazy, since the time we made this video last year the channel has grown
from 200 thousands subscribers to over 800 thousand. Which thank you all so much for
your continued support it really is amazing how converting a few of my old university
papers into video essays has grown to be this amazing opportunity to teach and entertain
so many people every week, but to avoid sounding like an oscars speech, 400% year on year growth
can only get a 10 out of 10.
Finally industry, and well if my parents and society at large are to believe I guess we
don’t have a real job so we get a 0/10.
And so concludes the economical economics of economics explained explained and with
an average score of 4.6 out of ten we go here on the economics explained leaderboard which
you know could be better. Oh well, always next year.
Fortunately, we can set ourselves up for that success by maybe doing some more proof reading
and most importantly investing in our future.
The former is kinda hard, and the comment section seems to do it better than we ever
can, always about 20 seconds after we upload a video but the latter is made easy.
With Acorns