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November 30, 2007

What are externalities?

Economists have interesting names for their concepts. Take externalities, for example. N.C. University economist Dr. Mike Walden explains was an externality is. Listen

"It's actually a fairly simple concept. It simply says that when someone is doing something – they're buying something, they're engaged in some activity – obviously, they are doing that for their own good, but there can be impacts on other people," says Walden, North Carolina Cooperative Extension economist and professor of agricultural and resource economics. "Those impacts can be good, in which we call that impact - that side effect if you will - a positive externality or they can be bad, in which case we call those negative externality.

"A good example of a negative externality is pollution. You and I drove here to do these tapings today - we didn't want to pollute, we like the environment - yet we did pollute, we created this adverse side effect. A good example of a positive externality is education. One reason why the state subsidizes higher education is because educated workers are better taxpayers, they attract better paying jobs, and that's all good for everyone in the state, not just for them."

Walden adds, "The economic approach to dealing with externalities is to subsidize those positive externalities - like I said, with higher education. For negative externalities, it's not necessarily to prohibit them but is to assess their cost, and then tax people. If they want to go ahead and produce that negative externality, tax them, tax them enough such that the money raised will be able to handle the adverse effects."

Posted by Dave at 08:00 AM

November 29, 2007

Is Christmas coming early?

Stores are already advertising Christmas merchandise. Is Christmas coming early this year? N.C. State University economist Dr. Mike Walden has the answer. Listen

"I think, yes, there is a reason (for the holiday ads appearing early this year), and it's one word, the economy. Retailers are worried this season. Now you might say, 'Aren't they always worried?' Well, yes, they are, but I think they have a good reason to be worried this season," says Walden, a North Carolina Cooperative Extension economist and professor of agricultural and resource economics. "A lot of the economic numbers are showing a dramatically slowing economy, not recession, but slowing growth.

"Gas prices are up. Oil prices are up. Of course we have the housing crunch. We've got consumer confidence indicating that consumers are worried. People are talking about recession, even though I don't think that will occur. And so this is all weighing on consumers. There is a lot of concern that consumer spending is slowing down, some indicators pointing to that."

Walden adds, "And of course retailers are reading all of this information and they're saying, 'Gee, if we don't do something, this could be a very dismal buying season.' And the weapon retailers have at their disposal is to start advertising earlier and promote their products and services and also promote deals, cutting prices and so forth. The good news about all this, with the early Christmas season, is that it does put the buyer in the driver's seat. There should be many more bargains out there for Christmas buyers. But, yes it really does come down to the economy."

Posted by Dave at 08:00 AM

November 28, 2007

What's wrong with the AMT?

There's much talk in Congress about curtailing or even eliminating the Alternative Minimum Tax. N.C. State University economist Dr. Mike Walden discusses the AMT, or Alternative Minimum Tax. Listen

"The Alternative Minimum Tax was developed about 20 to 25 years ago as a way to make sure that very high income people paid a certain percentage of their income in taxes, even when you took into account their deductions and exemptions," says Walden, a North Carolina Cooperative Extension economist and professor of agricultural and resource economics. "The point was that, of course, the tax code is filled with credits and deductions and exemptions, and depending on how big those are, any person - but in this case a high-income person - could get away with paying a very small amount of tax. So the Congress said, 'Look, we're going to leave those deductions and exemptions and credits in place, but we're simply going to limit them when you get to a certain (income) level and make sure that folks in certain income levels pay at least this percentage of their income in tax.'"

Walden adds, "Now one problem with that was when congress passed that law is they didn't index the income level to inflation. So what was high income 20 or 25 years ago now is medium income. And so the alternative minimum tax is increasingly being applied not to what we generally call rich people, but is being applied to middle-income people. And middle-income people are raising concerns about this. And that's why there has been a move - and really it's been a move over several years - but right now we have a specific bill in Congress to reduce or eliminate the alternative minimum tax. Of course the problem is - one problem is - that would eliminate some revenue from Congress, so Congress has to either reduce spending by that amount of lost revenue or find revenue in another way."

Posted by Dave at 08:00 AM

November 27, 2007

What's pushing up oil prices?

Oil prices are up about 50 percent just this year, and $100-a-barrel oil is just around the corner. N.C. State University economist Dr. Mike Walden explains why oil prices have risen so dramatically. Listen

"It wasn't that long ago, 10 to 12 years ago, that we had $10-a-barrel oil. So it certainly has dramatically risen, and yes, economists will say that you always want to look at supply and demand conditions, and this time around, it's really demand," says Walden, a North Carolina Cooperative Extension economist and professor of agricultural and resource economics.

"Supply is increasing, although it is increasing at a very slow rate, and in fact, the big set of countries that are really pushing higher supplies are countries in the former Soviet Union," Walden adds. "But we have seen supply increase. What's really pushing the price up, therefore, is big increases in demand.

"And again, it's a story we've talked about before. It's not so much demand from the developed countries, like Europe, Japan and the U.S. But it's increases in the demand from the developing countries, those countries whose economies are expanding very rapidly, such as China and India.

"So far, people look around and they find that the higher oil prices really haven't adversely affected the economy. You would think that the stock market would go into a nosedive with $100-a-barrel oil. It's not, and I think it is precisely because this is a demand-driven increase in price. If it was a supply driven increase in price - that is, supplies were actually contracting as we had in the 1970s - then I think that would lead to declines in the stock market and probably recessions," Walden says.

Posted by Dave at 08:00 AM

November 26, 2007

Economic terms

We hear so many economic terms thrown around today to describe the economy, from slow growth to stagnation to recession and even depression; N.C. State University economist Dr. Mike Walden provides a short tutorial on the meaning of these economic terms. Listen

"Slow growth means that the economy is still growing, but it is growing at a very slow rate," says Walden, a North Carolina Cooperative Extension economist and professor of agricultural and resource economics. "Usually economists get worried when the rate falls below 2 percent, and many think that is where we are heading in the next 6 to 9 months. But the point is that the economy is still expanding, it is just expanding at a very slow pace.

"Stagnation means that the economy is growing at a slow rate, so you have the slow growth aspect, but also sometimes you have higher inflation going along with it. So you kind of have the worst of both worlds: slow growth but rapidly rising prices. We had a situation like that in late 1970s and 1980s," Walden adds.

"Recession means that the growth rate actually goes negative. For an official recession, the rule of thumb is you have to have that negative growth rate at least for 6 months. The last time we had an official recession in our country was in the early 2001 to late 2001 period.

"Depression is a very long and very deep recession. It's a period of time, usually over several years, in which the economy does not grow. Usually we have to say the economy declines by at least 10 percent. The only time we had an official depression in the past 100 years was in the 1930s. I think it is highly unlikely that we will ever meet the very strong conditions for a depression in the future, and of course, that is a very good thing."

Posted by Dave at 08:00 AM

November 21, 2007

Who should use ARMs?

The interest rate a homeowner pays on an Adjustable Rate Mortgage can be adjusted, or changed, and recently rates have been adjusting higher, which means many households with ARMs have seen there mortgage payments rise. For some homeowners, this has led to bankruptcy. N.C. State University economist Dr. Mike Walden discusses ARMs and whether homeowners should avoid them. Listen

"ARMs really have gotten a bad reputation right now because many folks who took out ARMs several years ago have had those rates adjust and were surprised," says Walden, a professor of agricultural and resource economics. "They can't make the higher payments and that's led to foreclosures on their homes, and that has led to the housing crunch and housing crisis right now."

However, Walden adds, "ARMs are actually good in some situations. Clearly if you knew or had good advice suggesting that interest rates were going to fall in the future, what you would want to do if you were going to buy a home is take out an ARM, ride that rate down, and when it got to the bottom, jump off the adjustable rate onto a fixed rate. That would be a very smart strategy. Of course, that would mean knowing where interest rates are going.

"The other situation in which ARMs are good is if you are only staying in the home for a very short period of time, maybe only two or three years. Maybe you want to own a home and know you are going to be transferred or move to anther town in a couple of years. You could take out an ARM, your payments will likely be much lower than with a Fixed Rate Mortgage and you really don't care too much about the adjustment because you are going to be gone in a few years. We shouldn't really throw out ARMs. They are certainly good in certain situations."

Posted by Dave at 08:00 AM

November 20, 2007

A job market on the edges

Many say we are a two-piece job market. Jobs are fast growing on the high-salary side and the low-salary side. But mid-salary jobs are slow growing. N.C. State University economist Mike Walden explains why. Listen

"This is accurate ... You see this both in the national job market as well as here in the North Carolina job market. In fact my research shows it's actually going on to a greater extent here in North Carolina," he says. "The reason is, first of all, on the high-salary side that's related to the changes in our economy, our high-tech economy, that's increased the demand for educated workers That's why we have more people going to college, and we see it in the statistics: Highly educated folks are the ones getting the big salary increases.

"At the low end, the lower-paying jobs ... are primarily lower-paying service jobs. These are jobs that don't require a lot of skills, but they can't be done by machines. And so we need folks and because of our economy those jobs actually expanded.

"Now in terms of the middle paying jobs these have been factory jobs, and those factory jobs have been lost either by the work going to foreign countries or by people being replaced by machinery and technology.

So this two-edged job market has created a lot of challenges for the economy as well as for society as a whole."

Posted by deeshore at 08:00 AM

November 19, 2007

Rebalancing the housing market

The problems in the housing market - from home foreclosures to slowdowns in construction - are big drivers in the economy right now. N.C. State University economist Dr. Mike Walden explains what he thinks it will take to get the market back in shape. Listen

"We do have an imbalance. Right now we have a supply that's greater than demand. And that's an issue in economics, and it means that things will have to happen to bring supply and demand back in equilibrium," says Walden, a professor of agricultural and resource economics.

"On the supply side, what we need to have happen is either we have to have prices moderate in some cases (and) in some markets we are going to have to have prices of houses decline. We are also going to have to have reductions in new construction. And all those things are occurring," he adds.

"Then on the demand side we need to have buyers to come back, and I think they will come back as they see prices moderate or in some markets again decline and also - and this is where public policy comes into play - as the Fed perhaps lowers interest rates even more.

"Now this process has to go on on its own. There's not much the government can do other than lowering interest rates and perhaps helping some homeowners with refinancing problem loans. Most economists think this process is going on, will continue to go on. It won't be about until the middle of next year, 2008, that we may be back into balance in the housing market."

Posted by deeshore at 08:00 AM

November 16, 2007

Greenspan has spoken

When he was chairman of the Federal Reserve, Alan Greenspan was known for talking but not really revealing much. However, he has just released his autobiography, and it's been a hit on several bestseller lists. N.C. State University economist Mike Walden discusses three highlights of the book. Listen

"First of all this is a very readable and interesting book. I would recommend it to anyone who is ... interested in Alan Greenspan the person but also interested in a review of the economy over the last 40 or 50 years. It's very accessible," says Dr. Walden, a North Carolina Cooperative Extension specialist. "There aren't any equations or graphs or anything like that.

"Of course I can't cover everything that's in the book -- it's a 500-page book -- but here I think are three highlights I think people might find interesting:

"Greenspan follows the Fed through several financial emergencies, as he calls them. For example, right after he took over we had the big crash on the stock market in 1987. We had the false crisis (fortunately) about Y2K. And then of course we had 9/11.
And you see Greenspan talk about what the Fed could do and what the Fed did do in each of those situations," he continues. "I think that's a fascinating look at how the Fed operates behind the scenes.

"The second highlight that I found was that Greenspan comes across as a big fan of increased world trade. He argues that it has on aggregate made everyone richer. It's helped keep inflation low. And so he says some very interesting things about world trade.

"And then thirdly, of course, energy is a big issue. He does address that. And he actually thinks that the market will eventually solve our energy crisis. He says that long before we run out of oil we will stop using oil simply because it will become so much more expensive than alternatives," he concludes. "The question is what can we do now to speed up the development of those alternatives."

Posted by deeshore at 08:00 AM

November 15, 2007

Mandating health insurance

Several presidential candidates are talking about requiring that all households buy health insurance, similar to the way most states require all drivers to have auto insurance. Folks who can't afford health insurance would be subsidized in some way. N.C. State University economist Mike Walden points out a couple of issues with the proposal.Listen

"Of course there are issues with any proposal, so I don't want to just pick this one out," says Dr. Walden. "But, yea, there are a couple issues here. One is simply that all people will not comply. There's always going to be some segment of the population that simply won't. So we wouldn't necessarily assure (compliance from) everyone in our country ...

"Another broader issue perhaps is cost. One thing that's happened to health insurance in recent years is that states are requiring what is in health insurance policies. In fact one economist has estimated that states collectively have enacted 1,900 benefit mandates, that is, telling insurance companies you have to have this provision or that provision in your health insurance contract," he adds.

"Now one thing this clearly does it drives up the cost of health insurance, so one idea would be to review these mandates and to the extent possible make many of them optional. This would reduce the cost of a, say, bare-bones health insurance policy and make it more affordable for more people, so that if you did have a mandate that everyone has health insurance, you would have some limited policy that many, many more people could afford."

Posted by deeshore at 08:00 AM

November 14, 2007

Will consumers bail?

Consumer spending accounts for over two-thirds of the nation's economic activity, so as the consumer goes so goes the economy. With the sputtering house market and high oil and gas prices, there is much concern that consumers will pull back and slow their spending and therefore threaten the entire economy. N.C. State University economist Mike Walden weighs in with his opinion. Listen

"Three big factors ... will determine what consumers do in coming months. First and foremost is the job market. That's really where consumers get their feeling of the economy. And to the extent that the job market is strong, that's better not only for consumer attitudes but also for consumer spending. Unfortunately many economists think the job market is going to slow, so that should give us some concern about consumer spending in upcoming months.

"The second factor is the stock market. To the extent that the stock market rises, that puts gains, money, literally in consumers' pockets. The stock market has been bouncing around a lot recently, but if it does get in an upward trajectory, that'll be good for consumer spending. If, on the other hand, it goes down, that'll be bad.

"And then thirdly right now, and this is specific I think to this cycle, is the housing market. In the past four years a significant part of consumer spending has been financed by folks going into the value of their homes, drawing out equity and spending that money. And clearly now with the housing market slowing, with in many markets housing prices either stalled or perhaps going down, that's taken away that source of spendable income.

"I think the best bet will be that we will see consumer spending slow in coming months, but it is not going to fall off the cliff," he concludes. "We are going to have a slow period for about six to nine months before a rebound."

Posted by deeshore at 08:00 AM

November 13, 2007

What's on people's minds

N.C. State University economist Mike Walden has been traveling around the state with University of North Carolina President Erskine Bowles and the UNC Tomorrow Commission. The group has been listening to the state's people comment on issues confronting the state, especially issues that higher education can address. Walden says that five themes clearly emerged. Listen

"We've had 11 regional meetings. Each meeting has lasted three hours, and in most of those three hours we simply sat and listened to people in the community talk about issues," says Walden, a North Carolina Cooperative Extension specialist. "As I think back about these 11 meetings and think about all that's been said, I see five themes:

"First I think people genuinely are looking to the UNC system and particularly faculty of this system for their expertise and wanting them to get involved in the state's challenges, helping us address some of the issues that we have in this state. So that's a very broad theme that I saw.

"More specifically, people are very much concerned about K through 12 education. They are concerned about teachers (and) teacher training. They are concerned about the dropout rate in high school, and they are concerned about kids getting basic skills. All of those issues are things that the UNC system can at least have some impact on," he adds.

"They also is concern about health care, in particular nurses -- the quantity and quality of nurses. And, of course, the UNC system does have many nursing programs.

"Fourthly they are concerned about access to the UNC system campuses, and they are considering things like distance learning, satellite campuses and working with the community colleges. People want all of those things, and they want all of those things to be easily available," he says.

"And then lastly an issue that came up time and time again was I think a growing concern with the environment," he concludes. "And people want the UNC system to both be a leader in educating folks about the environment and finding solutions to environmental problems as well as leading by example in terms of new buildings and new structures and how the UNC system operates its physical plant."

Posted by deeshore at 08:00 AM

November 12, 2007

Why are college kids credit card targets?

A controversial issue on many college campuses is the targeting of students by credit card companies. In fact, some colleges have restricted such companies from advertising on their campuses. N.C. State University economist Mike Walden explains why college students are sought after as credit card customers? Listen

"I think there are several reasons," says Dr. Walden, a professor of agricultural and resource economics. "I think probably the biggest is that credit card companies know that although college students may be poor now they are going to be much, much better off income-wise in the future.

"In fact that's the main reason why I think most kids, at least in my experience, go to college because they know that is the ticket to a good income in today's kind of economy. So there's a big income-earning potential there, which translates into big spending -- which translates into the potential for credit card companies to get a lot of customers.

"There are some other reasons, too," Walden adds. "College kids are a growing part of the economy a growing segment of the economy as more young people go to college. Studies find that college kids also use their credit card and they are actually very loyal. They are actually very loyal to the credit card company that issues them the card.

"Now of course credit cards can be a very useful tool in fact they are useful tools," he concludes. "But users, including college students and graduates, must carefully their costs along with their benefits."

Posted by deeshore at 08:00 AM

November 09, 2007

Is North Carolina's economy slowing down?

There are many signs that the national economy is slowing. Retail sales have been sluggish and the housing market is cutting employment in the construction market. And high oil and gas prices also are still worrying consumers. These national trends are having an impact in North Carolina, says N.C. State University economist Mike Walden. Listen

"We do. In fact you can clearly see them in the job market, which is one of the broadest gauges of our state economy. Now the good news is that jobs are continuing to increase in our state," says Dr. Walden, a North Carolina Cooperative Extension specialist. "The bad news is that the rate of job growth is clearly slowing. For example in 2006, we were adding jobs at a rate between 3 and 4 percent a year. This year we are adding jobs at a rate between 1 and 2 percent a year. And many economists expect that rate of growth in jobs to actually slow through the end of this year and into the beginning of 2008 and perhaps not rebound until mid-year.

"A lot of this is tied ... to the national economy, the problems (and) imbalances in the housing market (and with) oil and gas prices at record levels.

"If we keep our fingers crossed and we'll stay out of a recession we'll still have job growth, but for the next six to nine months the growth rate is going to be very, very modest," he concludes.

Posted by deeshore at 08:00 AM | Comments (0)

November 08, 2007

When are we happiest?

Happiness may seem an odd topic for an economics program until you remember that economics is about making choices with limited resources in order to gain the highest level of satisfaction, or happiness. N.C. State University economist Mike Walden comments. Listen

"Well we have a new study ... that addresses this topic. The authors used thousands of people to get at the answer to your question. And the answer is -- if we could have a drum roll -- is that people are happiest both when they are very young and they are very old. They are least happy when they are in middle age, and specifically the authors found people are the least happy when they are in their 40s.

"Now let's try to make sense of this. Why? Why would you be least happy in your middle age years and happier on the two sides of that?" asks Walden, a professor of agricultural and resource economics. "Well I think there are several possibilities. Certainly people think about when they are young, you were carefree (with) no responsibilities. Perhaps that would contribute to young people being happy.

"Also when you are very old, you can perhaps reflect back on your achievements. Your children are grown and gone, and you can enjoy, for example, your grandchildren. Life is perhaps less hectic. Maybe you've come to terms with who you are. And all of those factors perhaps contribute to your being happy," he continues.

"On the other hand, when you are in middle age you've got a lot going on, you've got a lot of responsibilities. Your income may be high but again you have a lot of demands on those incomes. That may reduce your level of happiness. So this is a very interesting study. It certainly doesn't fit everyone, but I think it does give us cause for reflection."

Posted by deeshore at 08:00 AM | Comments (0)

November 07, 2007

Using economics to save water

Much of North Carolina is in a horrible drought. In some areas water supplies are down to only a couple of months. N.C. State University economist Mike Walden talks about ways to get the supply and demand back in balance. Listen

"Well with any resource ... you of course have two parts: you have supply and demand. In the short-run, obviously what's happened is our supply is way down. Now over the long-term we might want to build additional capacity for supply, more reservoirs. But right now the only way to get into balance is to bring consumption down (that is demand)," says Dr. Walden, a professor of agricultural and resource economics. "And so far what government officials have down is they have, number one, tried to encourage people to conserve. And secondly they have imposed restrictions -- rules on when you can water, for example, outside; if you can water; et cetera."

"Now there is an alternative approach that economists would argue at least should be considered, and that is to simply raise the price of water until you get the necessary reduction in usage," he continues.

"Raising a price is a way to get people's attention. Also it communicates to them that this resource water is now more valuable, and it is more valuable since the supply is lower. Also raising the price avoids the government having to set up rules and monitoring those rules, catching violators, et cetera.

"Now what you could do with the additional proceeds when you do raise the price and more revenues flow into the government water system is you could firstly return that money to citizens in terms of income grants, or perhaps better you could use that money for programs, for example, to help people buy mechanisms for the house that allow them to save water, also to put those monies into a fund to build more infrastructure to enhance supplies in the long run."

Posted by deeshore at 08:00 AM | Comments (0)

November 06, 2007

Which standard?

In economic terms, what does it take to be keeping up with the Joneses? Economist Mike Walden discusses two ways of answering that question.Listen

"This actually becomes I think more important as people move into retirement because when people stop working they become more sensitive to how their income is changing," says Dr. Walden, a professor at N.C. State University. "But anyway ... there are really two standards that you can apply to the phrase ... keeping up with the Joneses.

"One is the inflation standard. And this says that you want your income each year to keep up with inflation, or the rising cost of living," he adds. "So recently that would mean you would want to have your income going up by 2 or 3 percent.

"The second standard we will call the real growth standard, and this recognizes that on average the average person's income -- especially those folks who are working -- actually goes up faster than inflation. It may be going up 4 or 5 percent a year," he continues. "And so if you want to keep up with how the standard of living of the average person is changing, you need to have a bigger increase in your income.

"So what this sets up is a potential problem, especially for retired folks because oftentimes retired folks only see their income going up with inflation. If they actually realize that the average person's income is going up faster than inflation, they may feel like they are falling behind."

Posted by deeshore at 08:00 AM | Comments (0)

November 05, 2007

Tax brackets

Each year the federal government changes the tax brackets that apply to the individual income tax. N.C. State University economist Mike Walden explains why the change is important and describes some of the changes. Listen

"When we pay our income tax, particularly federal income tax, what happens ... is our taxable income -- this is after deductions and exemptions -- is actually broken down into segments, and each segment is taxed at a different tax rate. And the rates range from 10 percent right now up to 35 percent," explains Dr. Walden, a professor of agricultural and resource economics.

"Now each year also the ranges of those segments are going to change, and they are adjusted for inflation. And this is actually a good thing because it means a wider range of income, for example, will apply to the lower and smaller tax brackets," he adds. "So let me give you an example: For 2008 for a married couple, the 10 percent rate is going to apply to taxable income up through $16,050. Actually in 2007 it applied only to income up to $15,650.

"The highest 35 percent rate for 2008 is going to apply to taxable income over 357,700. In 2007 it was $349,700.

"So this may sound confusing, but it's incredibly important because the changes in these brackets -- the changes in the income ranges that each rate applies (to) -- really determines how much income tax you will pay."

Posted by deeshore at 08:00 AM | Comments (0)

November 02, 2007

Car buying habits

It's often said the whole is the sum of the parts, and N.C. State University economist Mike Walden says that's the case with statistics related to car buying, with the aggregate numbers on vehicle size, fuel efficiency and vehicle type all determined by the buying decisions of millions of individuals. Listen

"If we look over the past 20 years, what's happened is that we collectively have bought bigger and more powerful vehicles. The average weight of a vehicle over that 20-year period is up 900 pounds, a 29 percent increase," he says. "Horsepower and speed are also up to record levels, and as a result over this 20-year period fuel efficiency has actually declined.

"However in recent years, the last couple years, there are signs -- they are fairly modest, but there are signs -- that these trends are changing. Fuel efficiency is now up over the past 2 years, and I think an obvious reason for this change in attitude is gas prices. When gas prices were low people wanted to buy bigger vehicles, more powerful vehicles, speedier vehicles. And they weren't concerned as much with fuel efficiency.

"Now that gas prices are up their focus is on fuel efficiency, and we are seeing that result in aggregate statistics."

Posted by deeshore at 08:00 AM | Comments (0)

November 01, 2007

Age and the stock market

Theories of the stock market abound. N.C. State University economist Mike Walden explains the theory that holds that the market's ups and downs depend on the economy's age structure. Listen

"The idea is that the stock market does best when the percentage of the population in middle age is high and rising. The reason is that's the cohort in our population -- middle-age people -- who both spend the most and invest the most," says Dr. Walden, of N.C. State's College of Agriculture and Life Sciences. "So they are going to be spending money, and that's going to help companies. And
they are also going to invest in the stock market; that’s obviously going to help stocks.

"So followers of this theory say it can explain the rise in the stock market, for example, in the U.S. over the past 20 years as the middle-age cohort has gotten bigger. These followers also say the market will peak around 2010 when the percentage of people in the U.S. in middle age begins to drop," he adds.

"But there are lots of studies that say while age may be one of the factors explaining movements in the stock market, it's not the only factor, and indeed some studies find that its relative importance is actually fairly small. Some others say that really in today's ... worldwide economy, you should not only look at the age structure of your individual country, but you need to look at the age structure of the entire world. And when you do that this throws off those predictions that 2010 may be some tipping point with the stock market. "

Posted by deeshore at 08:00 AM | Comments (0)