Thursday, February 24, 2011

Swimsuit Model Economics

Warning: The following post contains statements of a strong heterosexual nature and other statements that could be considered “sexist”. Reader discretion is advised.

Well the Ukraine girls really knock me out
They leave the west behind
And Moscow girls make me sing and shout
They Georgia's always on my my my my my my my my my mind

I stumbled upon another unusual economic indicator this week. It is the “Sports Illustrated Swimsuit Issue Indicator”. It says that when an American appears on the cover of the swimsuit issue, stocks do well that year. But when a foreigner appears, the stock market drops.

This year’s cover model is Russia’s Irina Shayk (she is just a few letters short of being an Austin Powers character). According to the article I read, this is bad news for the stock market. Although it is uncertain how bad it will be (the author ran a historical analysis based on country origin), since this is the first time a Russian has appeared on this cover.

Of course this is silliness and has about as much credibility as Groundhog Day predictions. But Irina is more interesting to watch than Punxsutawney Phil, so of course it deserves much closer study all in the name of economics. So what does the selection of Irina Shayk say about the economy and the stock market this year? Who better to analyze this than I?


When I heard the woman was from Russia, I expected to see a pale, lithe, blond. But Irina appears healthy, solid, and stable. Not quite a “brick house”, but she’s no pushover. For someone living in a tough Russian economy, she is not malnourished (of course she doesn’t lack for dinner invitations, does she?) But she has recovered nicely from the recession. She is getting three square meals a day which are being converted into some impressive curves. After the turmoil of the past years, we seek substance and stability.


Irina is not even a light skinned blond. She is a dark complected brunette. She is not overly sexy, just very beautiful. A natural beautiful with no fillers, supplements or enhancements needed. After all the phoniness we’ve just experienced, we desire something real.

Long-Term Perspective

Irina is not a woman for a one-night stand. She is a woman for the long haul. Again, beauty trumps sex appeal. After all the get rich quick schemes of the aught (00’s), we want long-term investments. You may have flipped houses, but you wouldn’t flip… (Okay I’m not going there)


Irina looks like a baby-maker, or in today’s lingo a baby-mama. She is a strong, well-built woman, with nice child-bearing hips. She looks capable of popping out a baby on Tuesday and being back working in the fields on Thursday. Because of course that is what Russian women have had to do throughout history. And obviously the babies will be well fed. She could even manage triplets. Sure there would be a waiting line, but nobody would go to nap time hungry. We now seek things that are productive and make sense.


Russian women are very physically strong. They are stronger than they look. It’s in the DNA. Anyone who’s watched Anna Kournikova crush a tennis ball can attest to that. Correction: anyone who’s actually watched her tennis racket strike the ball can attest to that. We now seek strength in our institutions (and our cover girls).


I’m guessing here but, I believe Irina is probably very intelligent. I am basing this on the fact that I personally know four Russian (maybe Eastern European) women and they all have three things in common. They are very intelligent, very charming and very beautiful. Think about it. All those Russian spies in the movies weren’t just beautiful but they were crafty and smart. Hey, wait a minute. Maybe I should not have shared all those proprietary company documents with Svetlana who just happened to work for a competitor. Rats, taken advantage of again! We seek intelligence after listening to the fools.

An Economic Indicator

So looking at all these factors, I think the choice of Irina does have indications for what we want in our economic future. And it’s surprising that a Russian woman has not appeared on the cover of the swimsuit edition before. Of course back when it was the U.S.S.R., commie girls were such a turn-off, unless you were the Beatles.

And if Irina happens to read this and wants to meet to discuss economics, I will gladly listen to her opinions. The Model T meets the model I.

Oh, show me round your snow peaked
mountain way down south
Take me to you daddy's farm
Let me hear you balalaika's ringing out
Come and keep your comrade warm
I'm back in the USSR
Hey, You don't know how lucky you are, boy
Back in the USSR

Monday, February 7, 2011

Who's Your Daddy

- Just days after I blogged that the employment situation was much better than the experts believe, the January report showed the unemployment rate dropping to 9.0%. While I still believe the raw numbers can’t be trusted because there is too much “noise” in the data, the drop absolutely confirms my observations. In 60 days the unemployment rate has fallen 0.8 percentage points. This is the largest two month drop in over 50 years! Who’s your economic blog daddy now?

Yes I realize that the current employment situation remains tough. The number of people with jobs is still down 5.6% (7.7 million jobs) from pre-recession levels (Calculated Risk). And in a recent survey only 11% of respondents believe the job situation is improving significantly.

- When the Cash for Clunkers program was being debated, one side said it would result in increased overall sales and the other side said it would just pull ahead sales that would have happened anyways. We now can see by looking at the monthly chart of U.S. Light Vehicle sales that C-F-C was a colossal waste of money. It basically paid people to buy cars one to three months ahead of time. Also it disrupted auto production schedules (and supplier schedules) and car dealership operations. And don’t forget the needless destruction of all those functional used vehicles. Call it Cash for Cluster****s (You can fill in the *s).

- Two recent reader surveys (open participation) on MSN Money show that business/consumer confidence remains shaky. Only 17% of respondents think that better economic conditions are right around the corner and 24% even expect another recession. Only around 20% of respondents to the second survey (because of the nature of these surveys, many of the respondents are the same people) said they have increased spending since the recession. And about an equal number said they are still spending less. While this news is disappointing it does support my contention that there is tremendous pent-up demand in the economy. And once people believe that the economy is getting better, they will spend more money and this upturn will “get legs”. That is why I forecast a strong 2012.

- The GDP for Q4, 2010 is now estimated to be 3.2%, but my expert economic panel forecast was only 2.1%. Why? Professional economists tend to be too optimistic going into an economic downturn and too pessimistic coming out. It’s just plain human nature and it is compounded by the fact that some economic indicators aren’t functioning well right now (see unemployment observation above). The panel forecasts 2.5% for the current quarter. Let’s add the 1.1% difference in forecast from Q4, and call it 3.6% for Q1. The panel is forecasting 3.3% growth for Q2 and 3.2% for Q3.

- Something happened to consumer spending in the June-July period of last year. Sales decreased in many industries and that’s when some economists were worried about a double dip (the Model T did not decline during this time). I hope some professional economists analyze this to find out the cause. But I read this week that sales of one product began a strong sales gain in late July and has remained strong since. Of course I am referring to our favorite economic indicator: Men’s underwear sales. For all you people who cowboy-upped last July and August, I salute you for leading this economic recovery.

- President Obama has introduced “Win-The-Future” as the slogan that is going to solve our economic problems. If you are old enough, you remember Gerald Ford’s “Whip Inflation Now” which of course did nothing to stop inflation. If fact, inflation went on to whip our backsides.

But of course “Win the Future” is best represented by the letters WTF. This is ironic because Obama has finally succeeded in uniting people. His supporters are now chanting WTF and his opponents have been shouting WTF for the past two years. WTF indeed.