Tag Archives: demographics

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    The Forces That Will Reverse Housing’s Recent Gains

    Get ready for the "poverty effect"
    by charleshughsmith

    Monday, February 25, 2013, 9:56 PM


    Executive Summary

    • Intervention in the housing market by central planners is experiencing diminishing returns
    • The four major trend reversals most likely to depress housing prices in the coming future
    • The power deflationary force of reversion to (or perhaps below?) the mean
    • Why demographics do not support rising prices

    If you have not yet read Part I: The Unsafe Foundation of Our Housing 'Recovery', available free to all readers, please click here to read it first.

    In Part I, we sketched out the larger context of the housing market: the dramatic rise of mortgage debt, the stagnation of income for 90% of households and the unprecedented scope of Central Planning intervention in the housing and mortgage markets.

    In Part II, examine what will likely cause this nascent rise in housing prices to reverse, and to resume the decline Central Planning halted in 2009.

    Intervention Has Only One Way to Go: Diminishing Returns

    As noted in Part I, every Central Planning support of the mortgage and housing markets has already been pushed to the maximum, so there is nowhere left to go. Interest rates are already negative, over 90% of the mortgage market is backed by Federal agencies, the Fed has already pledged to buy trillions of dollars in mortgages, etc.

    Four years of this massive intervention has stripped the mortgage and housing markets of the ability to price risk, capital, and assets. This has created a culture of supreme complacency, as participants have come to believe interest rates will stay near-zero for the foreseeable future and Central Planning intervention is permanent.

    But nothing is permanent in life. And the current extremes of intervention and complacency have set the stage for some important reversals:

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  • Blog

    The Arrival of Japan’s Sunset

    The repercussions will be tremendous
    by Gregor Macdonald

    Monday, February 18, 2013, 10:05 PM


    For a successful technology, reality must take precedence over public relations, for nature cannot be fooled. ~ Richard Feynman

    Waiting for Japan's economy to make a strong recovery has been an ongoing game since 1990. Shall we play that game one more time?

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    Off the Cuff: Willful Blindness

    Our leaders are ignoring signs of both success & abuse
    by Adam Taggart

    Thursday, December 6, 2012, 12:34 AM


    In this week's Off the Cuff with Mish & Chris podcast, Mish and Chris discuss:

    • Willful Blindness of the Fiscal Cliff
      • Our politicians choose the wrong path despite models for success
    • Gold Manipulation
      • Price discovery is broken in today's markets. Patient bullion holders will be eventually rewarded.
    • America's Growing Demographics Problem
      • Fewer workers making fewer real products
    • Money Printing Forever
      • Why it's the surest bet


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  • Blog

    Boomers and Assets, Part II

    by Chris Martenson

    Sunday, January 18, 2009, 5:50 PM


    From yesterday’s blog, jrf29 writes:

    Chris, I’m not sure I understand this. How could baby boomers
    outnumber the generation behind them? Total fertility rate for the
    baby boomers is projected to settle around 2.1 (approximately equal to,
    or just slightly below, the replacement rate).

    The fact of the matter is that there’s a "hole" in the demographic profile right behind the boomers.

    The chart below is not a "rate chart". The length of the bars corresponds to the numbers of people broken out into 5 year age increments. The longer the bar, the more people it represents.

    We can state, unequivocally that there are more boomers than there are people in the cohort behind them.

    See that pink box (below)? That represents the boomers. There are more of them than there are people in the next set of three bars.

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