Way back on September 20, Dr. Jeremy Siegel had a letter posted in the Wall Street Journal's editorial page called Gray World. The article basically outlined that we can't escape from our demographic realities which is an aging population and not enough younger people to balance them out. This impacts social security (not enough younger workers to improve the workers to retirees ratio), not enough younger Americans to purchase the products that need to be sold by retirees so they have cash (you can't buy food with an iPOD), and why the global economy will help.
I really hope you can read the article because it makes a lot of sense to me and as Dr. Siegel points out, there are not many things we can do impact this reality. I had the chance to hear Dr. Siegel speak at a Money Matters conference courtesy of Yahoo! Finance on this same subject, but of course in more detail. Dr. Siegel spoke at length on social security and this was right around the time President Bush was pushing for major changes to it. I went up to Dr. Siegel after his presentation and asked him the following question.
Instead of the President talking about privatizing social security, maybe he should go with a new slogan which is make love and not privatization. Dr. Siegel pointed out that America benefited from the mass immigration at the turn of the 20th century and a huge population explosion following World War 2 that brought us the baby boomers. I asked him, why we couldn't increase legal immigration and have more babies and basically replicate what happened with us in the past? Dr. Siegel smiled and said, it was possible, but why not rely on the global economy to solve our issues. So, much for my argument with a Professor of Finance at The Wharton School of Business.
Anyway, give the article a read because it is very interesting and really our destiny unless we open up immigration and make love more....