RIGHT IDEA. WRONG REASONING...: Some financial commentators posit that retiring baby boomers will crush the stock market, as they convert their equity holdings to bonds and cash. But a new report from Vanguard disagrees. Baby boomers (those born between 1946 and 1964) do play a major role in the stock market, owning 47 percent of all equity assets in 2010, according to the Federal Reserve. However, thats little changed from the 45.8 percent owned by those aged 46 to 64 in 1992. At that point, boomers in their 30s and 40s held only 8.4 percent of stocks. ---------------------------- IT HAS BEEN MY POSITION THAT THE SPENDING BY BABY BOOMERS WILL GREATLY DIMINISH AND THAT IS WHAT WILL “CRUSH THE MARKET”. AS DIVIDENDS DROP AND PROFITS EVAPORATE THERE WILL BE SELL OFFS. THIS WILL EXACERBATE THE DECLINE. IT WON’T BE BOOMERS SELLING TO GET CASH AND FIXED INCOME AT ALL. IT WILL BE A NEAR TOTAL LACK OF CONSUMPTION BY BOOMERS, THE SAME CONSUMPTION WHICH HAS “POWERED US OUT” OF EVERY PREVIOUS RECESSION. NOT THIS TIME.. OF COURSE, VANGUARD SELLS STOCKS. HMMM?
Posted on: Mon, 25 Nov 2013 06:53:20 +0000
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