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Pastimes : Clown-Free Zone... sorry, no clowns allowed
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To: LTK007 who wrote (357481)2/13/2008 12:44:55 PM
From: stan_hughes  Read Replies (2) of 436258
 
IMO it's all in the demographics -- the post-WW2 baby boomers were shepherded wholesale into the equity markets by the financial planning industry that sprang up to direct the investment of their excess earnings -- they didn't want CDs, those were too boring -- they wanted action. You can directly correlate the rise in the SPX with a typical saving/investing profile tied to the age of the boomers

When a disproportionate percentage of a population enters any market, it is inevitably going to rise, and rise it did -- however, as those boomers start to wind down toward retirement, cease investing new funds and then eventually need to cash out, the whole mechanism gets thrown into reverse, and the tailwind of the past 25 years turns into a headwind

Housing has already peaked out -- good luck trying to sell 3-storey McMansions to empty-nesters with walkers who can't climb stairs -- but we're only in the early innings of the boomer-driven equity divestiture process, which also offers the double-edged sword of those same boomers starting to lean very heavily on Medicare resources

One would think such a scenario means that maybe a good place to hide would be health care services, but I have my doubts that the government will leave that sector alone, and I expect them to screw it up royally
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