Monday, March 4, 2013

The Skyscraper Index

Here's an interesting pseudo-economic theory to start your Monday morning.  It's called the Skyscraper Index, and was originally theorized by researched Andrew Lawrence back in 1999.  You can read more about it here.  The general theory is just like it sounds; as higher skyscrapers are built, this would signify the peak of an economic cycle.  Soon after these skyscrapers are built, a global economic downturn occurs.

Lawrence examined a series of skyscraper builds throughout history such as the Empire State building, the World Trade Towers, and their seemingly predictable economic downturns immediately following.  The most recent example of this trend has occurred with the 2009 completion of the the Burj Khalifa in Dubai.  This was right around the collapse of the housing market.

These types of correlations are just fun to study and could play in the back of your mind when you are thinking about investing, but don't let it dictate your moves too much.  As the article suggested, there are studies that have found no correlation between skyscraper size and economic downturns.  In any case, this little tidbit of folk-economics still remains entertaining.

Wonderful Moment of the Day - Restaurant gift certificates, YUM!

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