Long Term Trends Affecting Young Dreamers

[Skylark]

I'm trying to learn about long term trends that could affect my retirement. I hope to retire in 10 to 15 years and hope to live well and long into the 2050's and maybe beyond.

Some trends that seem to be real and that will have big effects on my retirement:

Peak Oil (the world will run out of oil and will have to shift to other fuels)
The Baby Boomer Demographic Shift
Globalization
Health Care Crisis

Are there other trends that have been predicted that will have major impact on future retirment?

Anybody know of good books on this subject?

[Marshac]

I think another trend we might see happen is if "privatization" of social security happens. With all that money going into the market, it will increase demand for a finite number of shares, and PE ratios will trend higher. Of course, I am not an economist and this is just my wild speculation.

If we assume that gen-X/Y will be the ones affected by privatization:

Gen X: ~59M ('65-'76)
Gen Y: ~72M ('77-'94)

Total: 131M people

From NPR this morning, the Bush administration is currently talking about $1k-$1.3k/year for contributions to "private accounts".

131M * $1000/year = $131B/year to $170B/year

The market cap of the NYSE (from what I could find): $15T
% of market cap added each year: ~.88% to ~1.1%

It's not HUGE, but it’s still there.

Thoughts?

[Skylark]

Does T = 1000 billion? That would make the additional amount due to social security private investment insignificant?

Forced savings, out of the government's greedy hands, sounds like a better strategy than the current ponzi scheme.

Quote:

Anybody know of good books on this subject?

"The Birth of Plenty" by William Bernstein provides a broad perspective of the evolution of economic history.
For a dash of excitement and drama try
"The Coming Generational Storm" by Laurence J. Kotlikoff and Scott Burns.

[charlie]

Keep an eye on China, but don't count the old USA
out yet. We have always muddled through in the
past and come through in the crisis.

Yes the world will run out of oil ..... some day. But
not soon. Before it happens we will be on the
hydrogen economy, IMHO.

Cheers,

Charlie

I read about the $1K per year as well - that's *very* little compared to what I save/invest for retirement per year---but isn't it amazing how much that is added up over the population. In fact I laughed when I saw that mentioned as the amount to be privatized per person, but again when I saw you rnumbers as to the aggregate, I can see how that would really change the financial market.....wow. I'm sure the devil will be in the details, i.e., will the US govt manage the accounts (becoming a 'broker') or allow people to choose a financial insititution of their choice - will they allow similar to 72t exclusions for withdrawal. Best thing for me would be to let me have and I'll manage it myself, but I can't imagine them allowing that - or they could do a TSP-like approach---I'd bite then.

I'm a 'tweener (born in 1964 - don't think like a baby boomer and don't think like a gen X) - maybe I'll see some SS - I'm not using that in the equation.

Bridget aka Deserat

[Marshac]

From what I have heard, large employers may offer various investment options, and employees of smaller companies may participate in a TSP style account managed by the government.

Social Security will become a huge problem beginning in 2015 when the treasury will be forced to begin repaying some of the 'special issue' treasury bonds held in the social security 'trust fund'. Two ways to pay that obligation... raise taxes, or print some more money. Either way they go about it, 2015 (and on) will be interesting.

[Marshac]

Quote:

"The Coming Generational Storm" by Laurence J. Kotlikoff and Scott Burns.

Looks good, I'll pick up a copy.

You want to know what's happening long term-wise?
Read some Ayn Rand or Orwell. They saw it. That is
your future. Deal with it.

JG

[indymom]

I read The Fountainhead and couldn't detect a philosophy, except that guy sure was stubborn. Was there a philosophy there? Not being a wiseacre, I really couldn't detect one.

[Bob_Smith]

Quote:

I'm trying to learn about long term trends that could affect my retirement.

This may not be what you meant, exactly, but one "trend" that I've noticed is a decline in personal ethical standards. There seem to be far more people who will lie, cheat, steal, cover-up, cut-corners, and so on. It affects everything. In the past we have tended to believe, for the most part, that our investments are safe from theft, that our medicines are full strength and clean, that our insurance companies can be relied upon to cover our losses, that our privacy is protected, that our news organizations try to be honest, that our military treats prisoners humanely, that our doctors will do their very best for us, that our food and water is clean, that our legal system isn't corrupt, that our votes are counted, that "Christians" will try to behave like Christ, and on and on. I don't know how much further things will slide, but I'm losing faith in many things I used to take for granted, and many people I know feel likewise. This could have far-reaching effects.

Hi Indymom! Try 'Atlas Shrugged' or if that's too much,
'We the Living'.

Along the lines of the world going to hell in a handbasket, I was listening to the radio today when the host opined that Illinois politics have been corrupt since it became a state. I don't know about that, but
it's been that way as far back as I can remember.
Part of me says it can't get worse, but when I really
think about it, I know it will, and not just here in the
"Land of Lincoln" either.

JG

[REWahoo]

Quote:

There seem to be far more people who will lie, cheat, steal, cover-up, cut-corners, and so on. It affects everything. In the past we have tended to believe, for the most part, that our investments are safe from theft, that our medicines are full strength and clean, that our insurance companies can be relied upon to cover our losses, that our privacy is protected, that our news organizations try to be honest, that our military treats prisoners humanely, that our doctors will do their very best for us, that our food and water is clean, that our legal system isn't corrupt, that our votes are counted,....

Wow Bob_Smith, I'm not the most perceptive guy around, but I sense you are a bit pessimistic about life in general. As a friend of mine frequently says, "Things are rarely as good as you would like them to be or as bad as you think they are."

REW

[Bob_Smith]

Quote:

...I sense you are a bit pessimistic about life in general. REW *

Well you sense wrong. My life is terrific! I'm not not pessimistic about life in general, but I'm not pollyannaish either. I'm just making observations about a general decline in ethical standards. And this isn't news - Time Magazine even did a cover story on it a few years back.

[retire@40]

Quote:

...one "trend" that I've noticed is a decline in personal ethical standards...

The trend you speak of is real.

You can see it in the way many kids dress for school with baggy ripped clothes, blue hair, nose and tongue rings, etc. They listen to rap songs that talk about killing cops, degrading women, and include every swear imaginable, but they can't listen to Christmas songs in school. Many more kids play video games that make it "fun" to steal cars, shoot and chain-saw people in half rather than learn how to be good citizens through the boy and girl scouts . Many schools don't have students say the pledge of allegiance followed by a moment of silence, but they do allow speakers that talk about "alternative lifestyles." Gay lifestyles are promoted as mainstream to toddlers and young children with cartoons, books, and targeted TV programs, while we see less of the old-style shows that promote family values with respect to parents and elders.

There is a real decay in the moral fabric of society and too many adults are not helping kids get out of this quandary.

[Marshac]

Quote:

The trend you speak of is real. You can see it in the way many kids dress for school with baggy ripped clothes, blue hair, nose and tongue rings, etc.

Hey, I had blue hair.... actually, it was more teal than blue.... I was also a youth group leader in college, so I guess I fail to see your correlation between blue hair and immoral behavior.

It's easy for all of us to sit back on our thrones and talk about how messed up 'those kids' are today, but you know what? I place the blame squarely on you, the parents. Having worked at the boys and girls club for several years while in college, I can't remember a single child there whose parents were NOT divorced and vying for the affection of their child.... trying to be the 'cool' parent.... the 'best friend'.... and in doing so, being totaly negligent in their duties as a parent. Sure, not all parents are like this, but a good majority of your generation is. Perhaps when the boomers grow up a bit, and become better role models themselves, we can begin to see some changes.

I'll get off my horse now.

[retire@40]

Quote:

Hey, I had blue hair.... actually, it was more teal than blue.... I was also a youth group leader in college, so I guess I fail to see your correlation between blue hair and immoral behavior. It's easy for all of us to sit back on our thrones and talk about how messed up 'those kids' are today, but you know what? I place the blame squarely on you, the parents. Having worked at the boys and girls club for several years while in college, I can't remember a single child there whose parents were NOT divorced and vying for the affection of their child.... trying to be the 'cool' parent.... the 'best friend'.... and in doing so, being totaly negligent in their duties as a parent. Sure, not all parents are like this, but a good majority of your generation is. Perhaps when the boomers grow up a bit, and become better role models themselves, we can begin to see some changes.

You made my point. Bad parenting is the number one reason many kids go down the wrong path.

Regarding the blue hair, unless you get into one of those "artistic" jobs you're not going to find work too easily or pick up many clients. Even in school, I found that the few kids that did have blue or pink or green hair did that because they craved attention and that their parents were mostly lacking in their lives.

Maybe that's not the reason you colored your hair blue, but that's the honest impression I got with the people I knew. What's worse is when people never grow out of the blue hair phase even when they are in their 30s and 40s as they work in mall jobs.

[Marshac]

I colored my hair blue because I knew that when I was done with college, I was kinda done with that phase of my life, and would never have the opprotunity to have blue hair again. It may sound lame, but that's why I did it. *


Edit: One interesting thing to report from the experiment.... I now know what it's like to be a well endowed woman.... kinda.... everyone would always look at my hair rather than my face. I would presume said woman experience something similar from men.

[sgeeeee]

Quote:

I colored my hair blue because I knew that when I was done with college, I was kinda done with that phase of my life, and would never have the opprotunity to have blue hair again. It may sound lame, but that's why I did it. * Edit: One interesting thing to report from the experiment.... I now know what it's like to be a well endowed woman.... kinda.... everyone would always look at my hair rather than my face. I would presume said woman experience something similar from men.

So does that mean that well endowed women should die their hair blue?

[brewer12345]

Quote:

The trend you speak of is real. You can see it in the way many kids dress for school with baggy ripped clothes, blue hair, nose and tongue rings, etc. They listen to rap songs that talk about killing cops, degrading women, and include every swear imaginable, but they can't listen to Christmas songs in school. *Many more kids play video games that make it "fun" to steal cars, shoot and chain-saw people in half rather than learn how to be good citizens through the boy and girl scouts . *Many schools don't have students say the pledge of allegiance followed by a moment of silence, but they do allow speakers that talk about "alternative lifestyles." *Gay lifestyles are promoted as mainstream to toddlers and young children with cartoons, books, and targeted TV programs, while we see less of the old-style shows that promote family values with respect to parents and elders. There is a real decay in the moral fabric of society and too many adults are not helping kids get out of this quandary.

Sigh... Let's not start getting into Bible-thumping mode, or I will have to start making Jack Chick jokes.