Dr. Lacy Hunt was the first economist to explain why money velocity is important: It measures whether a country is investing its money productively to create continued growth. When it’s above average and growing, that’s a sign of productive investment that pays good returns and creates more such investment. Falling indicates increased speculation. Falling and below average means the deleveraging of unproductive and counter-productive stages.

Like my demographic spending tools and urbanization vs. GDP per capita gains, I have now expanded this to all major countries in the world. This adds the acid test of whether investment is productive, and is especially important in emerging countries that are making the biggest investments in new infrastructures to urbanize. It can also help spot where corruption and bureaucracy are a hindrance.

Here’s a quick summary of the best and worst velocity readings in the major regions of the world:

I’ll start here with the western developed countries including Japan. Canada is actually the best at 1.33 with the U.S. second at 1.12 – both in North America, not Europe. The worst is Hong Kong at 0.26 (China on steroids!), with Japan a close second worst at 0.40. China is also very low at 0.50 because of constant overinvestment in infrastructure.

The highest velocity is in the youngest, least urban and fastest growing regions starting with Sub-Saharan Africa. Here, the poorest – the Congo – is highest at 7.99. Sounds great, but a very risky and volatile country at this point for investment. The lowest is the richest and most urban country, South Africa, at 1.37.

Southeast Asia is next and a much more affluent and attractive investment environment. Here, Indonesia is the highest at 2.58, and surprisingly Vietnam – which used to be much higher – is the lowest at 0.63. A sign of corruption seeping in?

My favorite region ahead for demographics and urbanization is South Asia, dominated by India. Velocity is similar in the key countries here, with Pakistan the highest at 1.71 and India actually lowest at 1.36. Still some corruption and bureaucracy there.

The most turbulent, but likely less so in the coming boom, according to my Geopolitical Cycle – the Middle East/North Africa – has Turkey as the strongest (1.85), although its political shift is more than worrisome. The weakest is U.A.E. at 1.16 due to constant overbuilding in real estate, like Hong Kong and China.

And finally, closer to home is Latin America from Mexico and the Caribbean to Chile. Here, surprisingly with its near-term debt, currency, and default problems, Argentina is the highest at a whopping 3.51. The largest country, Brazil, is the worst at 1.04. Argentina also has the latest peak in its Spending Wave in 2065 vs. Brazil the earliest in 2035. Argentina could be a good place to invest after the crash ahead.

This is a much more complex topic when you put all of our proven indicators together, but South Asia and Southeast Asia still look best, all things considered for the next global boom… after the global crash and reset.

Boom & Bust Elite subscribers will see more of this in a few weeks: I look at this indicator around the world in more depth in the upcoming December 2019 issue of The Leading Edge.

Harry Dent
Harry S. Dent Jr. studied economics in college in the ’70s, but found it vague and inconclusive. He became so disillusioned by the state of his chosen profession that he turned his back on it. Instead, he threw himself into the burgeoning new science of finance where identifying and studying demographic, technological, consumer and many, many other trends empowered him to forecast economic changes. Since then, he’s spoken to executives, financial advisors and investors around the world. He’s appeared on “Good Morning America,” PBS, CNBC and CNN/Fox News. He’s been featured in Barron’s, Investor’s Business Daily, Entrepreneur, Fortune, Success, U.S. News and World Report, Business Week, The Wall Street Journal, American Demographics and Omni. He is a regular guest on Fox Business’s “America’s Nightly Scorecard.” In his latest book, Zero Hour: Turn the Greatest Political and Financial Upheaval in Modern History to Your Advantage, Harry Dent reveals why the greatest social, economic, and political upheaval since the American Revolution is on our doorstep. Discover how its combined effects could cause stocks to crash as much as 80% beginning just weeks from now…crippling your wealth now and for the rest of your life. Harry arms you with the tools you need to financially prepare and survive as the world we know is turned upside down! Today, he uses the research he developed from years of hands-on business experience to offer readers a positive, easy-to-understand view of the economic future by heading up Dent Research, in his flagship newsletter, Boom & Bust.