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The risk with this kind of story is that we end up focusing on the financial at the expense of the real. Ultimately, the goods and services consumed by retiree

The risk with this kind of story is that we end up focusing on the financial at the expense of the real. Ultimately, the goods and services consumed by retirees are provided by the real economy, not by financial instruments (which is just a fancy way of saying that you can't eat savings). The way to ensure their availability is to make real investments, not financial ones: build infrastructure, factories, accessible retirement homes; train nurses, doctors, etc... Unfortunately, focus on the financial can trigger (and arguably has already triggered) some extremely counterproductive reflexes. For example, we've been told for decades now that private savings are essential for retirement. This may be true at an individual level, but in the aggregate it causes a savings glut - those low interest rates aren't just the making of central banks - and it withdraws effective demand from the real economy, which disincentives many of the investments in the real economy we need to provide for an aging society. So yeah, good to see some focus on the aging society, but please try to look beyond the financial smokescreen.

asciident 7y ago
Fair point. In that case, the real issue then is that more people are retiring and living longer, needing more healthcare and labor, and the workforce is dwindling in comparison? Maybe the amount of resources that can be used as medical supplies is decreasing (and if you think single-use plastic like plastic bags and straws are a problem, wait until you see how much single-use plastic and other materials are used everyday day in healthcare). What's the solution in non-financial terms? Make more young people care for the elderly? Automate as much of the healthcare as possible? Let some elderly people go without healthcare?
- atq2119 7y ago
  I suppose as other people have pointed out in the thread, the first step is figuring out how much of the shortfall is actually real. But yeah, ultimately the solution would have to be something along the lines of the things you mention. Of course, you don't necessarily have to automate healthcare: if you automate something else, it could also free people to then move to healthcare.
candybar 7y ago
Savings glut isn't just at the level of individuals though - as long as it's in the form of savings, it doesn't matter who does it, sovereign wealth funds, pension funds, social security, insurance companies, etc. But that's just on the supply side. The real problem is on the demand side of funds, we've run out of low-hanging fruits and marginal productive investments, whether in infrastructure, tech or labor are returning less than before, which drives the rates lower. This is in turn driving up the prices of existing profitable enterprises and premium real estate, squeezing out both productive ventures and labor.

asciident 7y ago

Fair point. In that case, the real issue then is that more people are retiring and living longer, needing more healthcare and labor, and the workforce is dwindling in comparison? Maybe the amount of resources that can be used as medical supplies is decreasing (and if you think single-use plastic like plastic bags and straws are a problem, wait until you see how much single-use plastic and other materials are used everyday day in healthcare). What's the solution in non-financial terms? Make more young people care for the elderly? Automate as much of the healthcare as possible? Let some elderly people go without healthcare?

atq2119 7y ago
I suppose as other people have pointed out in the thread, the first step is figuring out how much of the shortfall is actually real. But yeah, ultimately the solution would have to be something along the lines of the things you mention. Of course, you don't necessarily have to automate healthcare: if you automate something else, it could also free people to then move to healthcare.

candybar 7y ago

Savings glut isn't just at the level of individuals though - as long as it's in the form of savings, it doesn't matter who does it, sovereign wealth funds, pension funds, social security, insurance companies, etc. But that's just on the supply side. The real problem is on the demand side of funds, we've run out of low-hanging fruits and marginal productive investments, whether in infrastructure, tech or labor are returning less than before, which drives the rates lower. This is in turn driving up the prices of existing profitable enterprises and premium real estate, squeezing out both productive ventures and labor.