Demographics: Global Implications for Economic Growth and

Investment

30th Annual Monetary & Trade Conference

Drexel University Philadelphia, Pennsylvania

Richard F. Hokenson

April 24 ,2012

The Speed of Aging: Developed Countries

Number of Years for Percent of Population 65+ to rise

from 7 to 14 percent

26454547

5365

6973

85115

0 20 40 60 80 100 120 140

Japan (1970-1996)

Spain (1947-1992)U.K. (1930-1975)

Poland (1966-2013)

Hungary (1941-1994)Canada (1944-2009)

U.S. (1944-2013)Australia (1938-

Sw eden (1890-1975)

France (1865-1980)

Speed of Aging: Developing Countries

Number of Years for Percent of Population 65+ to rise

from 7 to 14 percent

202122232324252727

0 20 40 60 80 100 120 140

Colombia (2017-2037)

Brazil (2011-2032)

Thailand (2003-2025)

Tunisia (2009-2032)

Sri Lanka (2004-2027)

Jamaica (2009-2033)

Chile (2000-2025)

Singapore (2001-

China (2000-2027)

United Nations – Total Fertility Rate by Development Status

The United Nations Forecast through the year 2100

Total Population in Billions Annual Percent Change

2050 Population as a Multiple of 2010

No data 0.7 < 1.0 1.0 < 1.3 1.3 < 1.9 1.9 < 3.4

Source: Population Reference Bureau 2011 World Population Data Sheet; Hokenson & Company.

Demographics and

Destiny

Maximum Effective Capital Gains Tax Rate versus Percentage of Young Taxpayers

0

5

10

15

20

25

30

35

40

45

50

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

2005

2010

2015

2020

Perc

en

t

20

22

24

26

28

30

32

34

36

Tax Rate

% Young

Source: U.S. Treasury; Hokenson & Company

The Era of Low Interest Rates has only just begun

Yield on Long-Term Treasuries versus Smoothed Growth in Current Dollar GDP

U.S. Current Dollar GDP (Year-ago Change (bars) and Smoothed 10-Year Change (line))

U.S.: Smoothed Growth in Current Dollar GDP and Labor Force

U.S.: Smoothed Growth in Current Dollar GDP and Forecasted Labor Force

Yield on Long-Term Treasuries versus Historical and Forecasted Growth in Current Dollar GDP

Population Trends in

The Developed World

15

The Developed World Population Change by Age Groups in Millions: 2005-2015

16

Japan and Europe

17

18

Western Europe Population Change by Age Groups in Millions: 2005-2015

Europe – Countries above or below average median age 1960 vs 2060

Aging in the European Union

E.U. & Candidates Aged Dependency Ratios(population 65+ as a percent of 15 to 64)

15

20

25

30

35

40

45

50

55

2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050

Sources: US Census Bureau, International Data Base; Hokenson & Company

EU EU + Candidates EU + Candidates ex Turkey

21

The American “Exception”

22

Total Fertility Rate for Selected Regions and Countries: 2010

1.0

1.2

1.4

1.6

1.8

2.0

2.2

United

States

Western

Europe

East

Europe

Japan Russia China

Source: United Nations; Hokenson & Company.

Legal Immigration

23

US: Number of Live Births in Millions

24

Annual Household Formations and Housing Completions

25

Percent Reaching Stated Anniversary by Marriage Cohort for Women's First Marriages: 2009

26

US versus Eurozone

27

28

Social (In)Security?

29

United States: Population in Millions (2010)

30

United States: Population in Millions (2050)

15 10 5 0 5 10 15

0-45-9

10-1415-1920-2425-2930-3435-3940-4445-4950-5455-5960-6465-6970-7475-7980-8485-8990-9495-99100+

MaleFemale

Sources: United Nations; Hokenson & Company.

Brazil Russia

India China

Russian Federation: Life Expectancy at Birth

Russian Federation : Number of Entry-Level Workers

10

12

14

16

18

20

22

24

26

1990 2000 2010 2020 2030 2040 2050

Mil

lio

ns

Sources: United Nations; Hokenson & Company.

China Population Change by Age Groups in Millions: 2005-2015

-40

-30

-20

-10

0

10

20

30

40

50

60

0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+

China: Population of Working Age

35

The Aging Index: China versus the US

0

20

40

60

80

100

120

140

160

180

1990 2000 2010 2020 2030 2040 2050

Ratio USA

China

Sources: United Nations; Hokenson & Company.

India Population Change by Age Groups in Millions: 2005-2015

-5

0

5

10

15

20

25

30

35

0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+

India: Number of Entry-Level Workers

160

170

180

190

200

210

220

230

1990 2000 2010 2020 2030 2040 2050

Mil

lio

ns

Sources: United Nations; Hokenson & Company.

Brazil Population Change by Age Groups in Millions: 2005-2015

-3

-2

-1

0

1

2

3

4

5

6

7

0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+

Brazil : Number of Entry-Level Workers

41

Important Changes in the

Financial Arrangements of

Households

U.S. Households with more MONEY than TIME (Number of U.S. Families with Two or More Earners)

U.S. Households with more TIME than MONEY (Number of U.S. Families with One Earner)

45

Suggested Readings and References

Birth and Fortune: The Impact of Numbers on Personal Welfare by Richard Easterlin

The Great Wave: Price Revolutions and the Rhythm of History by David Hackett Fisher

The Feminine Mystique by Betty Friedan

The Age of Discontinuity by Peter Drucker

Population and Development Review

Richard F. Hokenson

rhokenson@hokenson.biz

(609) 516-7780