Ahhh...you now I love anything that discusses demographics. Here is something I wrote a while back for those that may have missed it. I think the knowledge of demographics helps much in having a vision of the future.
>>>>>>>>>>>>>>
Demogranomics - It's over..
It's over. Economic prosperity as we knew it is dead. This debt thing will affect the economy for several years - but there is more. I just read an article where a small bank has no money to lend at all because the interest they would have to pay investors is too high and there isn't even a market anymore for selling that debt. They can't sell equity because it dilutes current shareholders too much.
By the time we work through these debt issues we will be deep into baby-boomer retirement. The boomers are the ones that gave us the growth over the last 20 years. When you have a generation of 49 million being replaced by 80 million you are going to have growth. The next generation after the boomers is almost equal in size. No growth will be coming from this group when they reach their most productive years.
Then you have to think about the cultural changes that came about during the boomers years. How much extra automobile production was necessary to go from a driveway with one car in the 50's to 2 or more by the 90's? Think of all the extra building materials used over the last 40 years to build two and three car garages instead of one, or in many caes just carports.
And women went to work. Just think of all the extra clothing that was bought as more and more women entered the work force. How do you replace that growth? How about closest space?. Look how many industries may have seen higher growth from houses getting larger. Easily two to three times more toilets were sold per house than what we saw prior to the fifties. The average size home in 1970 was 1500 square feet. In 2005 it was 2,434 square feet.
And this all came about with cheap energy. Cheap energy is gone forever. The means less disposable income to buy those extra items that we all bought in the last 40 years.
Then we had the break up of the family as divorces became more common. The average size household in 1950 was 3.38. It was 3.68 in 1940. Today it is about 2.57 people per household. If we still had 3.38 folks per household there would be a need for 15 to 17 million less households than what we have today. Think about how much that contributed to growth in the boomer years. As the economy slows households may start to get larger again as many will no longer be able to afford to live on their own. I can vision large subdivisions becoming ghost towns.
You won't read anywhere about what I mentioned above. Nobody that has the floor has thought much about where past growth came from. They are too quick to just assign it to the size of the baby-boom generation. It is way more than that. A generation that through it's size and mostly cultural changes gave us an economy on steroids - an economy that many take for granted as just being more of the norm that we became accustomed too.
...and there is more I could get into to prove my point about the death of economic prosperity for at least the next 15 years.
I was going to write a book about this stuff but probably will never get around to it. The consequences to the next generation and those after are going to be monumental. I was going to title the book 'Demogranomics'. It's a word I coined. Go ahead, google it. It's the study of the demographics and the economy of the boomers.
Joe Eifrid
Market Data 
Markets 
AI
