21st Century Economics

Wealth:
A professor at New York University estimates that the richest 1 percent of Americans own half of all stocks, bonds and other assets.
Power: Largely as a result of the wealth and also due to the usual time in one’s life that you typically gain that wealth, the vast majority of the power in this country is in the hands of the “older” generation - that is, those age 43 to 65. This is the age that most people exercise the most influence on their environment because it is in their interest and ability to do so.

Influence:
A recent study revealed that 80% of the domestic news stories on television network news concern only 4% of people; most of the remaining 20 percent of domestic stories on the evening news cover the other 260 million of us.

Demographics:
The aging population of the US and the rest of the world means that the wealth, power and influence will continue to shift more and more into the hands of an older and older population.

Impact

Politics:
We know that the older generation is largely conservative and mostly Democrats. They favor the continued high levels of spending on the federal level to fund programs that they benefit from such as Social Security, Medicare and tax benefits for the elderly.

This will not only continue but it will rise to levels never seen before - Rise to levels that will make the other age groups and generations into minority citizens with no control over their own lives and futures.

Investments:
For the most part, the finances of the era of retiring boomers will be a shambles.

(1) 71 million baby boomers will be trying to sell their stock portfolios at the same time - dropping the market to its lowest level in 75 years;

(2) 71 million baby boomers will be trying to sell their expensive homes in order to move into more modest sized retirement condos. This will create the greatest drop in real estate prices in history. One bedroom Florida condos will cost $200,000 while the 30 room brick colonial in upstate New York will remain on the market for 3-4 years while the price drops to below its current mortgage balance and sells for under $150,000;

(3) When 71 million baby boomers reach retirement, we will see the effects of three decades of excess at the expense of no savings. Social Security and Medicare will be overwhelmed while millions of boomers that did not save discover they cannot maintain their previous lifestyles on their $900/mo. social security stipend. They will vote, in mass to increase Social Secuity taxes to the loss of millions of younger workers.

Society:
The conservative nature of society will pervade everything. Care designs, books, movies, music, religion and news. The majority of the audience for the mass media will be old people with money. Who do you think they will cater to?

Wealth, Power and Influence is about to undergo a major adjustment in the next two decades, it will change everything - especially investment opportunities - or lack thereof.