Do you know the rule of 72?
The Rule of 72 is a quick, useful formula that is popularly used to estimate the number of years required to double the invested money at a given annual rate of return. It's not 100% accurate, but it's close.
Divide 72 by the interest rate you are getting on an investment, and that will tell you how many years till your money doubles.
As an example. If you invest money and are getting a 6% return, your money will double in 12 years. If you are getting 4% return your money will double in 18 years.
Rates of doubling are important. The interest rate is the rate of GEOMETRIC growth of the principle.
Let's look at the rate that total deaths are increasing from COVID-19
7 days ago the US was at 8,407 deaths
4 days ago the US was at 12,722 deaths
1 day ago the US was at 18,586 deaths
Total number of deaths (more than) doubled in 6 days.
The previous week's average for the GEOMETRIC growth was 1.15, or a 15% increase every day.
Now that we know how doubling works, lets see how long before number of deaths will double again, based on that rate of 1.15. Let's do a little algebra, and call the number of deaths on day 1 "x" If deaths increase by 15% every day, how long till the amount of dead has doubled?
(note, I am using * to mean "multiplied by" and multiplying something by 1.15 is how to determine a 15% increase.)
1x * 1.15 = 1.15x
1.15x * 1.15 = 1.3225x
1.3225x * 1.15 = 1.520875x
1.520875x * 1.15 = 1.74900625x
1.74900625x * 1.15 = 2.0113571875x
So roughly speaking if the rate of increase in the number of deaths stays at 1.15, we will see the total number of deaths from COVID-19 every 6 days.
Which means if the rate stays the same in 6 days we will be at 37,000 dead in the US. In 12 days we will be at 74,000 dead (more than total US deaths in Vietnam).
But here's the good news. From 4/4 till 4/10 the DAILY rate of the death rate increase (the rate of increase of the rate increase -- NOT the death rate) fell from 19% to 13%. The average for the week was still 15%, but it looks like the rate is falling.
Unfortunately if you look at the graph in the first image, we are are not flattening the curve (decreasing the rate of increase of the rate of increase the rate) that significantly. While New York's curve IS flattening (chart not attached) other US cities are starting to blow up.
We're all in this together, like it or not. Please make informed decisions. And using force against another except in self defence is always wrong.
Craig Bersak shows the derivation. It all comes down to ln(2) = 0.6931. This could be called the “rule of 69” but it’s mentally easier to divide into 72.
I was just reading about this rule in this article: https://www.dividendpower.org/2021/04/22/what-is-the-rule-of-72/ I initially found it very useful in applying it to my financial strategies, which I am constantly trying to improve. This development is essential because it improves your thinking and opens up more opportunities. I try to use these opportunities every day not to miss any chance to become more prosperous. I am sure that rule 72 is an important piece of advice for every financier.