Financial, Economic and Social Mood Update (April 1, 2018)
The US stock market peaked on January 26, 2018 with the Dow Jones 30 Industrials Index reaching 26,617 on that date. The market dropped 3,234 points in 14 days but it has recovered 17 percent of that initial drop since then. The overall stock market remains robust with high asset values – 90 percent of record high value. EWI analysis believes that the crash has commenced and that the next major target is Dow Jones = 18,000. Last month marked a major USD $ 4 QUADRILLION global write-down of derivative financial instruments, hedge funds or contingent liability financial instruments. These are risky “bets” which money center banks made much larger than their entire balance sheets (much larger than the balance sheets of everything in the entire world).
Next in line will be both unfunded liabilities and actual mostly Dollar-denominated debt instruments worth up to USD $485 TRILLION. The value of “real” assets is much smaller – USD $99 TRILLION in the equity market and USD $8 TRILLION global supply of gold bullion. To make a long story short, this is the reason for the need to write off the inflated “funny money” of debt, unfunded liabilities and derivative financial instruments.
The visible events in the global equity markets and political arena mask a much more factual 3-way struggle for supremacy behind the scenes. The “old order” is represented by the American Petro-Dollar, the European Union (EU) and the Japanese Yen. The 2 “challengers” are based largely in Asia. One of these camps is represented by the Chinese Yuan (Mainland China), China’s BRICS allies and the formerly British Commonwealth. The 3rd camp is represented by the forces behind the emerging crypto-currencies and closely related block-chain technology. The Chinese “Petro-Yuan” commenced trading on March 26, 2018.
The “old order” is marked by sky-high levels of indebtedness and by demographic collapse. The magnitude of this demographic implosion is magnifying the problem of indebtedness with the pending insolvency of the banking system, the pension system and of the socialist welfare state. Collapsing demographics is creating an inverse population pyramid with too many older people and too few younger people which in turn is collapsing consumer demand.
Many formerly industrialized countries are transforming themselves into massive retirement communities. There is no other way to describe this than as a full blown economic disaster. The “oldest” country in the world today is Japan. By the year 2050, fully 69 percent of the Japanese population will over the age of 60 years. The following countries will not be too far behind in the forecast percentage of their respective populations being over the age of 60. These include:
1. 59 percent = Italy
2. 53 percent = Finland and Portugal
3. 51 percent = Bulgaria, Greece, Latvia and Sweden
4. 49 percent = Austria, Croatia, the Czech Republic, Denmark, Estonia, France, Lithuania, Malta, Slovenia and Spain
5. 46 percent = Belgium, the Channel Islands, Hungary, the Netherlands, Switzerland, the UK and the Virgin Islands
6. 44 percent = Canada, Norway and Serbia
7. 41 percent = Bosnia-Herzegovina, Curacao, Hong Kong, Romania and the Ukraine
8. 40 percent = Germany
9. 38 percent = Barbados, Slovakia and the USA
Human fertility rates (represented by the average number of children a woman will bear during her lifetime) has dropped to alarmingly low rates. Women now have 2 or more children (a number necessary to keep the population at a steady level) in merely 120 out of 273 independent nations, countries with limited sovereign recognition, dependencies and territories.
I think about how these rates have dropped so markedly in just 2 generations. My own grandparents had more children than the people of the “high fertility” countries do today.
Average female fertility is highest in sub-Saharan Africa, but these rates are far below what they used to be in Europe and Asia just a generation or so ago. The countries of Niger, Angola and Mali have the highest rates, where the average woman will bear at least 6 children in her lifetime. A figure of 5 or more children exists in countries such as Burundi, Somalia, Uganda, Burkina Faso, Zambia, Malawi, Afghanistan, Mozambique, the South Sudan, Nigeria and Liberia. A number of 4 or more children is to be found in countries including Ethiopia, East Timor, Benin, Tanzania, Guinea, Sierra Leone, Cameroon, the Congo, Gabon, Equatorial Guinea, Togo, Chad, the Central African Republic, Senegal, Sao Tome & Principe, the Palestinian Territories, Guinea-Bissau, Madagascar, Ghana and Iraq.
The average female will bare at least 3 children in countries such as Eritrea, Zimbabwe, Rwanda, the Western Sahara, Mauritania, Yemen, the Sudan, Gambia, Egypt, the Ivory Coast, the Comoros Islands, Namibia, Jordan, the Solomon Islands, Tonga, Vanuatu, Papua New Guinea, the Marshall Islands and the Philippines.
Countries where the number of children is at least 2 (necessary for zero population growth) include Kenya, Guam, Tuvalu, Belize, Oman, the US Commonwealth of the Northern Mariana Islands, Nauru, Guatemala, Haiti, Samoa, Algeria, Laos, Swaziland, American Samoa, Honduras, Israel, Tajikistan, Bolivia, Lesotho, Pakistan, Kyrgyzstan, Botswana, Cambodia, Syria, Malaysia, India, Micronesia, Fiji, Kuwait, the Faroe Islands, the United Arab Emirates, Venezuela, Djibouti, Panama, South Africa, the Dominican Republic, Argentina, Kazakhstan, Mexico, Cape Verde, Tunisia, the Cook Islands, Ecuador, Bangladesh, Burma, Peru, Nepal, Morocco, Indonesia, Sri Lanka, St. Martin, Curacao, Libya, Dominica, New Zealand, Grenada, Turkey, Antigua & Barbuda, Iceland, Guyana and Colombia.
All other 153 countries and territories around the world are at an alarming figure of less than 2 children. This is an ominous omen for economic consumer demand, for the viability of pension systems, for real property values, for vacancy rates, for tax revenues, for the social welfare state, and for the healthcare system. It is also a major reason why government and business leaders in so many so-called developed countries want ever more immigrants. Human consumer demand peaks at the average age of 45 and falls steadily thereafter.
