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Comment by TrackerFF | Hacker News Reader

Ironic as it may sound, coming from a childfree millennial, I'm kind of puzzled how the system will survive. Both my grandparents died in their 90s, and spent over 30 years are retirees - mainly living off their state pension.

As people become older, they'll either have to work longer, or the system will come crashing down. Especially with lower fertility rates. My generation should be birthing kids as the previous ones, but I think almost half of my peers are childfree, too. And we're in the age that we have maybe - if lucky - 6,7 more years to reproduce.

I can't imagine a population where 1/3 will be retired people. It is also a huge drain on the healthcare system.

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A substantial realignment in the economy is what's coming. The charge will be when the rate of vacated homes starts to uptick as their aren't enough capable people to live in them: right now the major metros have a lot of pent up demand, but those retirement figures imply a different reality as time goes on: eventually those people start going into care facilities, but their won't be nearly enough people around to supply the demand for the properties they're finally moving out from.

The real markets are absolutely not ready for that reality.

Case in point - Japan, with so many abandoned homes

In the countryside, I doubt that this is the case in Tokyo.

> right now the major metros have a lot of pent up demand

The major metros have the least to worry about from this. Those cities have high housing costs because of demand, or to put it another way, those cities have high demand despite high housing costs, and the economic factors that cause people to be attracted to cities aren't going to go away; density is devastatingly efficient and it's cheaper and more convenient for people to be close to things. But what this means is that as the population falls, that latent demand causes the less dense, lower-priced areas to depopulate. See Japan's crisis of rural depopulation, and how Tokyo isn't the one feeling the pinch.

> can't imagine a population where 1/3 will be retired people.

We're currently trending towards a birth rate of 1 or less. This means 4/5 will be retirees in three generations.

Your 1/3 figure is wildly optimistic. Little chance it will be that good.

I often meditate on this - can even the concept of index fund retirement survive an actual depopulation scenario?

Of course, older forms of retirement can still work (have ten kids each of who have ten kids and you command an army in retirement; perhaps they’ll even call you King) - but aside from that where does the growth come from when not from population or immigration?

Index funds will survive anything short of a complete collapse of the financial system. Even if returns are low, they only have to be better than the alternatives (on a risk adjusted basis).

Sure - but being better than the stock-alternatives in a fifty year bear market is cold comfort; and many retirement plans are built on assumed real returns that may never be seen again.

if the consumer base collapse what will keep the stock fundamentals going ?

Stock values may decline but there will still be index funds holding those stocks.

Hopefully the deflation scenario due to technology will help with this shift gracefully. Else, it will be extremely difficult.

But if we had deflation in the economy, how will the investment scenario will Peter out is anyone’s guess.

I wonder The people who invented this financial growth will, why they didn’t thought about this in the long term? I guess, I have asked a question which has quite a generic answer already…

>I can't imagine a population where 1/3 will be retired people.

In South Florida it's always been like that or more.

No imagination required :)

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