By John Richardson
Our argument ument that demographics drive demand is gaining greater traction.
Demographic challenges apply both to developed markets, where populations are rapidly ageing, and to emerging markets such as China, which confronts ithe consequences of its disastrous one-child policy.
The slide above shows rising life expectancy – just one of the challenges.
We keep scrambling around for other explanations as to why the world economy has yet to return to where it was before the global financial crisis, such as “central banks haven’t done enough – all we need is more economic stimulus”, or “the entire answer for the US is more investment in domestic oil and gas resources, combined with more momentum behind reshoring“.
But in a new video, MoneyWeek editor-in-Chief Merryn Somerset Webb says that demographics are “one of the key bits of information that you need to understand what’s going on in the West today.
“It doesn’t matter how much monetary stimulus you put in, how much fiscal stimulus you put in, you can’t turn back the demographic tide.
“There will be a point in the future when people will look back on the way we are behaving now, trying to regain the growth of the past when we don’t have the demographics of the past, and think we were completely mad.
“What do we do about it? That’s a tricky one. But recognising it, recognising the change, is surely the first step towards being able to deal with it!”
Please click here to see the full video.