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News Link • Economy - Economics USA

Demographic Hell: Are Retiring Boomers Going To Dump Stocks?

omed, merely because over the coming years, a growing wave of retirees will sell assets to pay for their retirements? In a note called Respect Your Elders, Bo fA economist Neil Dutta takes a look at this "Asset Market Meltdown Hypothesis" and notes that while it's intellectually appealing, the concerns are probably overblown. First, he notes the simple economic equation behind the meltdown theory: P*K = Ny*S On the left side you have the asset market P*K where P = the price of assets and K = The supply of assets. On the right side you have the investor/saving side, where Ny = the number of savers and S = the savings rate.

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