Saturday, January 21, 2017
Policy Makers, like Generals, Are Busy Fighting The Last War
Why is this a bad thing (economically)? 65+yr/olds consume at about 70% of the rate they did during their peak working years. By the time they are 75+yrs/old their consumption drops to about 50% to 60% of what it was during peak working years. They are credit averse, preparing for (or on) fixed incomes, and napping is one of their favorite activities and it doesn't cost a thing.
3- Global Depopulation of young (excluding Africa)
The chart below highlights global births per five year periods ex-Africa plus UN estimates for medium and low future births. Again, the reality will likely split the UN estimates but a clear peak in the late '80's and huge deceleration of births since is undeniable.
The surging births in Africa plus medium and low UN future estimates. But sadly, absent income, without savings, without access to credit, and the world awash in overcapacity as it is...this population growth in Africa has no avenue to export themselves to prosperity or greater consumption. They are simply economically going to remain poor beyond belief and will not be capable of driving any significant economic activity.
Excluding Africa, births from the remainder of the world are collapsing since the late 1980's peak. And according to the UN's best guestimates, births will only continue trending down world over (excluding Africa). Fewer births means fewer consumers, declining need for housing, commodities, and nearly everything else as this smaller population works it way through from the bottom up (also known as deflation or depopulation).