Posted on 05/31/2004 5:13:26 AM PDT by sarcasm
Aging baby boomers could trigger financial market shocks, deflation, slow growth and then an inflationary spurt, all very real risks that central bankers must consider in the next 20 to 30 years.
A research paper laid out these little-explored factors at an Austrian national central bank conference in Vienna on Thursday.
Japan, which is just emerging from a decade of stagnation, deflation and a banking crisis, serves as a wake-up call for the United States and Europe to get down to business and tackle their creaking public pension systems to lessen these risks.
"It could really blow up" if pay-as-you-go pension systems are not reformed, said E. Philip Davis, economics professor at Brunel University in London, who presented the paper. He said that central bankers still have time to assess the impact on monetary policy and their role as lender of last resort to manage the risks created by millions of baby boomers starting to retire in 2010.
But economists at the conference on growth and stability in the European Union said these issues have scarcely been examined from a monetary perspective.
Davis said the 1987 stock market crash, the 1994 bond market reversal, the Mexican peso crisis and even some elements of the 1997-98 Asian crisis are examples of the type of market price volatility that could occur as a huge wave of retirees reallocate their assets from high-growth stocks into safer bonds.
Even the technology-driven stock market bubble of the late 1990s can be partly attributed to a surge of baby boomers entering their peak saving years in their 40s and 50s, he said.
You sound shocked, shocked, that politicians lie.
Nothing more human than to try to have someone else pay your bills.
There is a narrow window of opportunity to at least reform the system enough to make it manageable. Once enough baby boomers retire, they will resist any change to the system. Too many have unrealistic expectations and believe that the government can solve any problem. After that point, the only "reform" will be to increase taxes and regulate more and more of the economy to "control" prices. If we miss the opportunity to truly reform things, the socialists will have a number of years to try false "reforms" that will eventually run everything into the ground.
I have news for you. The 'greatest generation' is leaving this planet in large numbers now and over the next 10 years, so it's academic how much they get.
I agree with phasing out social security. Anyone who wants to should get their money back, with interest as a one time lump sum. Or if they prefer an annuity funded by that sum. That's for those who have not retired. Those who have can continue getting benefits at current levels.
How is socialism going to end when both parties keep pushing it?
When I retire I'm building a machinegun nest and eating endangered species as they pass by.
Gee, the truth is ugly!
bump and save
Conservative Boomers have been much less politically active, and only in the last couple of decades has the addition of younger conservatives kept the socialist hoards from completely plowing us under.
This can change if younger voters become aware of their demographics and their voting potential. The Boomer liberals are desperate, and their behavior in this election cycle clearly shows it. They would like younger voters to stay discouraged, and thereby remain disenfranchized.
Move Over Boomers -- Gen-X And Gen-Y in the Coming Decades
The greatest threat to our economic future is the continued theft of wealth through wage withholding for income tax, social security, and medicare. American products cannot compete globally when one third of all labor costs is required to feed a growing government behemoth. Boomers will resist changing to another form of taxation, and the younger voters are going to have to force-feed it to them.
All that is required is to educate younger voters and get them active in the political process.
No point in getting uptight about money already gone.
Yep!
I agree.
I spend a lot of time with younger people.
Gens X and Y are fed up.
I am actually a late Boomer, ( born late 1960) but I have WAY more in common with the younger ones.
I can't STAND my Boomer SIL. She personafies all things Hillary. Yuck.
Totally agree with your comments.
sergeantdave wrote:
When I retire I'm building a machinegun nest and eating endangered species as they pass by.
ping
Yes, I was wrong, thanks.
Seven times? New one on me.. - Where did you get that figure?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.