Global Deflation Pandemic Begins to Brew

[Martha]

Yes, places with lower birth rates have higher standards of living.

[Independent]

Quote:

Originally Posted by NW-Bound I am no economist, having taken only 2 bonehead econ classes in college, but have read that deflation is a scarier thing than inflation.

I'm with you, maybe some economist here can fill us in. My understanding is that the risk of deflation is that people save but don't invest. That is, they decide it makes more sense to put currency in a safe deposit box than to buy bonds or stocks. The reasoning is that the currency is sure to have more buying power next year, while anything else is risky.

On the other side, businesses don't want to borrow because they need to repay the loan with revenue earned in a market where prices are falling.

This is about it. I don't know of any other macro concerns about deflation. If deflation is so small that most people don't believe that prices are really going down (e.g. the BLS says prices are declining by 1% per year, but most people don't feel that's true), then the saving/investing thing doesn't happen. Similarly, business profits may be squeezed, but it's not like everyone is going bankrupt.

Am I missing something important here? or is this pretty much the story?

[Helen]

My understanding about deflation is probably more limited than yours, but that doesn't mean I don't have an opinion

I've read that the scary thing about deflation is the Feds don't have many tools to pull us out of one. Inflation is easier to curb than deflation.

[Zathras]

Quote:

Originally Posted by Helena Because of immigration and because people are living longer, you may not realize it but the global birthrate is decreasing even in third world nations. Sometime in this century the population of the planet will begin to decline. No more ever growing supply and demand... no more ever expanding global markets... the future of the planet is deflation. ~

This would be welcome news. Population growth is a drastic issue for the environment as well as many other issues.
Unfortunately all the estimates I have seen have world wide population growth zooming up close to 9 Billion by 2050 and continuing to increase (although at a slower pace) after that.
However, deflation has little to do with the growth of world population so much as the regional population growth combined with the growth of the standard of living.

[quietman]

Quote:

Sometime in this century the population of the planet will begin to decline.

Why would you expect that? Is someone predicting that worldwide standards of living will rise to US/European standards in under 100 years? Is someone predicting a vast war or global pandemic? I don't see any demographic trends that would lead to decreased world population.

[Helena]

Quote:

Originally Posted by quietman Why would you expect that? Is someone predicting that worldwide standards of living will rise to US/European standards in under 100 years? Is someone predicting a vast war or global pandemic? I don't see any demographic trends that would lead to decreased world population.

UN stats


U.N. sees world population decline by 2050

August 1, 2009


A United Nations report predicts that within less than a decade, most of the world's women will be producing fewer than two children, and by mid-century, the world's population will shrink for the first time since the Black Death in the 14th century.


Currently, world fertility is only half what it was in the 1960s.


The prevailing wisdom holds that, as nations develop their economies, women will increasingly favor conventional families of two parents and two children, stabilizing the human race at 10 billion to 12 billion people compared with 6 billion today.


But now it appears more likely that world population will peak at just 8 billion, then shrink in the second half of the century, says the U.N.

Joseph Chamie, who directs the U.N.'s population division, reports that fertility in more than 60 nations is already below replacement levels and that actual population decline has been postponed only because people are living longer.


By some estimates, the world's population will be cut in half within the next 1½ centuries. In Mexico, Brazil and India, birth rates are plummeting. In Africa, AIDS has cut average life expectancy by more than 10 years.

http://www.suntimes.com/news/world/1...tion02.article





Here is an interesting video trailer on the subject

Demographic Winter

http://www.youtube.com/watch?v=IG2IZEzUmA0

~

[quietman]

Wow. If true - and I still have my doubts - world economies will have to undergo a huge shift away from assuming unrelenting growth. New housing starts becomes meaningless above the few units needed to replace housing stock destroyed for some reason. Consumerism can only drive expansion by increasing consumption per person, instead of increasing population. Will be a brave new world. Countries will want to encourage immigration if they want to grow, especially relative to their neighbors.

[brewer12345]

Anyone who thinks they can predict what will happen in 40 years has a screw loose. Most of us would be happy with the next 40 minutes.

[ERD50]

Quote:

Originally Posted by Helena UN stats U.N. sees world population decline by 2050 August 1, 2009 A United Nations report predicts that within less than a decade, most of the world's women will be producing fewer than two children, and by mid-century, the world's population will shrink for the first time since the Black Death in the 14th century. Curre U.N. sees world population decline by 2050 :: CHICAGO SUN-TIMES :: World Here is an interesting video trailer on the subject Demographic Winter YouTube - Demographic Winter Trailer

Helena, thanks for providing a reference - that helps us to understand if it is just some random opinion (which is fine) or something with a real basis.

-ERD50

[Leonidas]

Quote:

Originally Posted by Helena ...Joseph Chamie, who directs the U.N.'s population division, reports that fertility in more than 60 nations is already below replacement levels and that actual population decline has been postponed only because people are living longer.

Interesting, but Chamie has written extensively on the subject and, outside of this article, his writings don't seem as conclusive about a one way trip for the world population. In fact, he says that there is a very small tipping point of about a quarter of a percent that can lead to overpopulation or loss of population. However, he does state that most demographers doing long range projections see fertility levels stabilizing right around the replacement rate of 2.1 births per female. Between here and there though, he does forecast some huge shifts in demographics in different parts of the world.

Quote:

...today approximately 45 percent of the world’s population resides in countries with below-replacement fertility versus less than 1 percent of world in the 1950s.

In the interim, Chamie sees the path we set in policymaking is crucial to what he calls "perhaps the paramount issue of the 21st century". (Chemie is no longer with the U.N. and is now the research director for the Center for Migration Studies).

Quote:

Originally Posted by Helena Here is an interesting video trailer on the subject.

I don't think I want to spend $20 for the DVD, but if I can find it to rent or download someplace I might do that. At the end of the trailer I noticed what seemed like a repeat of Chamie's declaration that policy making is going to be vital, with the addition that strengthening marriage is paramount to...survival? That should make for some interesting policy debates.

[WhoDaresWins]

Interesting YouTube video. I believe it was in the WSJ that I read that divorces are down due to the recession. And I read someplace else that singles are more interested in marrying and home life. And doing things that don't cost a lot of money with family, including cooking at home, board games, camping, are up. And saving is up, too. Maybe something good will come out of this period of time if we don't forget all about it when we eventually have a sustained recovery.

[quietman]

Quote:

today approximately 45 percent of the world’s population resides in countries with below-replacement fertility

If the "tipping point" is indeed as small as 1/4 of 1 percent, then I'm not sure this prediction will be as likely as he implies. A large portion of that 45% reside in China where aggressive population controls are resulting in lower birthrates and an unbalanced sex ratio. Would not be surprising at all to see backlash there sometime in the next 40 years.

[haha]

Après nous, le déluge! But we don't care, we are Boomers, God's chosen people.

But, as a last ditch Demographic Hail Mary, I would be willing to volunteer for a select corps of proven breeders to marry up to four young women who lust for motherhood. Of course, we will need full state support including medical/obstetrical, as well as state provided day care to allow us to concentrate out energies on job #1.

See, there is always a silver lining. Patriotism and the good of humanity are powerful lures to sacrifice.

Ha

[WhoDaresWins]

As per a previous post, Haha, we will all have to chip in and get you a plane ticket for Chile or Peru or wherever that was. And didn't some one mention the rush for young women to marry in Japan? Just don't go to China, too many bachelors and not enough young women. There is a bidding war for the young women, especially in the hinterlands.

[Helena]

Asia's Demographic Winter

YouTube - 101 East - Asia's Baby Crisis - 03 July 08 - Part 1

~

[unclemick]

Quote:

Originally Posted by haha Après nous, le déluge! But we don't care, we are Boomers, God's chosen people. But, as a last ditch Demographic Hail Mary, I would be willing to volunteer for a select corps of proven breeders to marry up to four young women who lust for motherhood. Of course, we will need full state support including medical/obstetrical, as well as state provided day care to allow us to concentrate out energies on job #1. See, there is always a silver lining. Patriotism and the good of humanity are powerful lures to sacrifice. Ha

I watch Dr Strangelove reruns - I always enjoy the proposed ending.

heh heh heh -

[brewer12345]

Quote:

Originally Posted by haha Après nous, le déluge! But we don't care, we are Boomers, God's chosen people. But, as a last ditch Demographic Hail Mary, I would be willing to volunteer for a select corps of proven breeders to marry up to four young women who lust for motherhood. Of course, we will need full state support including medical/obstetrical, as well as state provided day care to allow us to concentrate out energies on job #1. See, there is always a silver lining. Patriotism and the good of humanity are powerful lures to sacrifice. Ha

Here's bride #1:



3 more on the way...

[Independent]

Quote:

Originally Posted by haha Après nous, le déluge! But we don't care, we are Boomers, God's chosen people. But, as a last ditch Demographic Hail Mary, I would be willing to volunteer for a select corps of proven breeders to marry up to four young women who lust for motherhood. Of course, we will need full state support including medical/obstetrical, as well as state provided day care to allow us to concentrate out energies on job #1. See, there is always a silver lining. Patriotism and the good of humanity are powerful lures to sacrifice. Ha

I don't think you've got the right reason for the drop in birth rates. It isn't a lack of men. It's because once women get a little education and opportunity, they decide they have better things to do with their lives than make babies.