Passa ai contenuti principali

8 Billion And Counting...


According to the UN, this week the world's (human) population hit 8 billion.

As DB's Jim Reid notes, "it's incredible to think that several million people alive today were around when the world population first crossed 2 billion in around 1927"  Consider this: during the lifetime of the oldest people on earth today, the world's population has seen exponential growth in a way it has never seen before.

In Reid's opinion, the impact of this is still being felt everywhere in financial markets and economies today: rapid population growth in the twentieth century onwards encouraged democracies, encouraged the welfare state and forced governments to spend more than they took in taxes for the first time in peace time in order to be re-elected. 

In the peak years of population growth of the second half of the twentieth century (1964 was the peak growth year), governments could use future strong population growth to pay for their real time promises to their citizens. This period, of course, started with low global government debt levels, but ultimately the promises were only possible by breaking the Bretton Woods gold-based system (1971) and moving to fiat-based money and structural deficit financing. 

50 years later and population growth is grinding to a halt in the developed world but the debts remain and the promises are coming home to roost and also getting bigger and bigger in real time. 

It doesn't end there: the world's population will likely hit 9 billion in 2037 and 10bn in 2058 (absent a "great reset", of course). And yes, these extra 2 billion will mostly be in the least developed nations with the most developed countries now being flat or declining in aggregate out to the end of the century.

As Reid concludes, "it's a real head scratcher as to how the more developed world will pay for the promises made when the world was seeing exponential population growth. Hopefully, the burden won't all fall on the 8th billion person on the planet who will be born today."

Commenti

Posta un commento

Post popolari in questo blog

Fwd: The Looming Bank Collapse The U.S. financial system could be on the cusp of calamity. This time, we might not be able to save it.

After months  of living with the coronavirus pandemic, American citizens are well aware of the toll it has taken on the economy: broken supply chains, record unemployment, failing small businesses. All of these factors are serious and could mire the United States in a deep, prolonged recession. But there's another threat to the economy, too. It lurks on the balance sheets of the big banks, and it could be cataclysmic. Imagine if, in addition to all the uncertainty surrounding the pandemic, you woke up one morning to find that the financial sector had collapsed. You may think that such a crisis is unlikely, with memories of the 2008 crash still so fresh. But banks learned few lessons from that calamity, and new laws intended to keep them from taking on too much risk have failed to do so. As a result, we could be on the precipice of another crash, one different from 2008 less in kind than in degree. This one could be worse. John Lawrence: Inside the 2008 financial crash The financial...
Posta un commento
Continua a leggere

3 Reasons Why Gold Will Outperform Equities And Bonds

3 Reasons Why Gold Will Outperform Equities And Bonds https://www.forbes.com/ 3 Reasons Why Gold Will Outperform Equities And Bonds For centuries, gold has played a major role in human history and has become interwoven into the financial fabric of society. Beyond its investment following, gold has become synonymous with wealth. Historically, gold's early use cases revolved around money – a form of "medium of exchange". After the second world war however, several countries and their respective currencies, started to shift away from the gold standard and migrated towards a fiat currency system. Today, gold remains largely a "Store of Value", and due to its unique properties and large number of use cases, it has managed to distance itself from other asset classes in terms of correlation, demand / supply drivers, and investment purpose. Gold's idiosyncrasies function as a double-edged sword, as it is challenging to predict ...
Posta un commento
Continua a leggere

China Market extends fall on talks of less stimulus

Headline indices of the Mainland  China  equity market closed down for second straight day on Tuesday, 23 April 2019, as profit booking selloff continued after a flurry of comments from policymakers signaled they're less comfortable about adding stimulus. At closing bell, the benchmark Shanghai Composite Index declined 0.51%, or 16.45 points, to 3,198.59 The Shenzhen Composite Index, which tracks stocks on China's second exchange, fell 1.32%, or 23.05 points, to 1,728.86. The blue-chip CSI300 index shed 0.16%, or 6.60 points, to 4,019.01.  Top-ranking policymaking bodies including the Politburo, the State Council, the central  bank  and the  Central Financial and Economic Affairs Commission  have all held meetings in the last two weeks.  China  should fine-tune monetary policy in a pre-emptive way based on economic growth and price changes, according to a top-level meeting reports chaired by  President  Xi Jinping.  Monetary po...
Posta un commento
Continua a leggere