Inapt Comparison of the Day

Yes, yes, I know I shouldn't have a dig at people on "our team" but:

Sovereign wealth funds grew to $3,500bn (£1,750bn) last year, putting them on track to surpass the entire economic output of the United States within seven years, according to a new study.

Now it is true as a matter of basic mathematics: the 24% annual growth rate when compounded over eight years does give $18 trillion or so, ahead of where we would expect US GDP to be at that point (it's currently around $14 trillion).

It's still rather inapt though. For GDP describes income, which is a flow, while those sovereign wealth funds are, as the name implies, wealth, which is a stock. It's all too easy to become a cropper if you confuse those two distinctly different measures.

The wealth of the US is of course a stock and there are a number of different ways of measuring it. Wikipedia (yes, I know) tells us that total wealth of households and non-profits is around $60 trillion, while $45 trillion is a usual rule of thumb for net household wealth.

But we can go much further. If you crunch through these numbers on intangible wealth (the value of the rule of law, institutions and so on) you get the quite remarkable figure of $175 trillion or so for total US wealth.

Which of those numbers you use is largely a matter of taste: but you really should be comparing a stock with a stock, wealth with wealth, not wealth with income.

Yes, the sovereign wealth funds have oodles and oodles of cash, but that's still not very much compared to the wealth of the US, something measured in oodles and oodles and oodles.

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