Dennis Gartman
September 28, 2016

On Demographics; An Old Argument Revisited

ON DEMOGRAPHICS; AN OLD ARGUMENT REVISITED... But this time with the hardest of data, for as has been said in the past and shall be said again in the future, "Demographics is destiny." In the industrialized world, this is especially true for in the industrialized world people are living longer and fewer and fewer babies are being born, making the problem of retirement a more and more serious problem indeed. Using data from the UN, from RBC Capital Markets and from The Financial Times we note the following.

Let's look at the percentage of the populations of the industrialized nations for various age groups starting with the present and moving to the UN's projections for 2050 and 2100 (with all percentages round to the nearest 1%):

                                           2015       2050        2100
 0 to 14 years of age            26%        22%         17%
 15 to 24 years of age          16           14            12
 25 to 44 years of age           29          27            25
 45 to 64 years of age           20          23            24
 65 to 79 years of age            7           12            15
 80 and above                        2            3               5

Notice how in the group's below 44 years of age, the percentages drop consistently, while in the cohorts 45 and above the percentages rise. Simply put, this is not a good thing; simply put this is not the hallmark of a healthy demographic environment; simply put, this is the pathway to demographic disaster.

If we wish to look at it another way, let's consider the percentage of the population of various industrialized countries that are 65 and above:

               1960          1980       2000       2010         Today
Japan        5%             7%         17%        23%          25%
Australia    7                9            11            13             15
The US      9               13           16            17            18
The U.K.   12              15           16            16            17
THE EU      8               12          13            13            15

The changes are dramatic, with the number of Japanese elderly as a percentage of the total population rising by 500% between 1960 and today. In Australia and the EU the percentages nearly doubled; in the US it has almost precisely doubled and only in the UK has the percentage 7 risen by only by less than 50%. In other words, the industrialized world is indeed growing older by the hour, with the trends in most instances accelerating.
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