World GDP and the Big Mac Index

The Big Mac Index in The Economist was updated last week. After wondering for some time now what this fun little currency valuation measure would look like when plotted alongside the GDP for the associated countries, it was finally time to take action.

Click to enlarge

Little countries like Iceland and New Zealand are the repeated targets of the Yen carry-trade though the kiwi now seems fairly valued against greenback - don't know whether that's a good thing or not.

It's really the currencies of giants like China and Japan that are causing all the problems, but then if you were them, would you just let your currency rise in value or trade freely on foreign currency exchanges?

They've tried that a few times over the past two decades with disastrous results.