[AMRadio] BAs and Baby Boomers

[Peter Markavage]

There's your answer:

"...or the potentially larger and more promising market of buyers from
overseas."

Pete, WA2CWA

> ---------- Original Message -----------
> From: "Merz Donald S" <merz.ds at mellon.com>
> To: "'Amradio (E-mail)" <amradio at mailman.qth.net>, "'Glowbugs 
> (E-mail)" 
> <glowbugs at piobaire.mines.uidaho.edu>
> Sent: Mon, 12 Apr 2004 17:30:06 -0400
> Subject: [AMRadio] BAs and Baby Boomers
> 
> > Q: What do baby boomers have to do with boatanchors?
> > A: Anything, and -- not to put too fine a point on it, everything. 
> 
> > 
> > Let me explain.
> > 
> > A baby boomer is a person born between the years of 1946 and 1964. 
> 
> > Every country on Earth has a significant baby boomer generation. 
> In 
> > the USA, the baby boom generation is over 26% of the population. 
> The 
> > current aggregate income of USA baby boomers is $4.1 trillion. 
> They 
> > (we) use this income to account for 40% of total demand and almost 
> 
> > 50% of all discretionary spending. Boomers hold 80% of the cash 
> and 
> > 79% of all the assets that exist--including --ta-da-- 
> boatanchors.
> > 
> > So what? Well, 46 + 65 = 2011. The boomers are retiring soon. 
> > Actually, due to early retirements and other factors, significant 
> 
> > increases in retirements will begin between 2006 and 2008. By 
> 2011,
> >  retirement-mania will be in full swing. Sometime shortly 
> thereafter,
> >  "the largest wealth transfer in history" begins to take place. A 
> 
> > minimum of $41 TRILLION will begin transferring "from parents to 
> > children and from philanthropists to charities."
> > 
> > Economists only have this figured out in the broadest terms. But 
> > sometime between 2011 and 2021, the baby boomers will become what 
> is 
> > called "net sellers of investments". That means that you and I 
> will 
>  unload more boatanchors than we buy. Economists disagree about what 
> 
> > this means for the financial markets. The gloomy ones say that 
> this 
> > will usher in a "structural bear market that could last throughout 
> 
> > much of the second quarter of the 21st Century." But let's deal 
> with 
> > boatanchors here.
> > 
> > I changed the wording in the paragraph below to say "boatanchors" 
> 
> > everywhere it used to say "financial holdings". But this is from 
> an 
> > insurance industry report:
> > 
> > "At first, the older Boomers will begin selling some of their BAs, 
> 
> > but the sales will be absorbed rather easily by the larger number 
> of 
> > younger Boomers who are still eagerly buying. Eventually, though,
> >  even the middle and younger-aged Boomers will want to liquidate 
> > some of their boatanchors. Who can they sell to? The only options 
> 
> > seem to be the much smaller and more financially pressed 
> "Generation 
> > X" that grew up in the shadow of the boom, or the potentially 
> larger 
> > and more promising market of buyers from overseas."
> > 
> > This is why you and me have anything and everything to do with 
> > boatanchors. We own practically all of them. And we all need to 
> get 
> > rid of them over the next 15 to 25 years. Worse, the only market 
> we 
> > have for them is "much smaller and financially pressed". 
> > 
> > A word to the wise should be sufficient. Keep your collection in 
> > touch with the demographics and the concepts of supply and demand. 
> 
> > BAs are fun. But they are not good long term investments. It's 
> just 
> > that simple.
> > 
> > Since no one is going to want them, I am planning to be buried 
> with 
> > mine--like the ancient Egyptian mummies with their cats.
> > 
> > 73, Don Merz, N3RHT
> > 
> > Quotes are from various insurance industry reports on the web and 
> 
> > the World Future Society. 
> >   
> > The information contained in this e-mail may be confidential and 
> is 
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> copying 
> > or re-use of the e-mail or any information contained therein by 
> any 
> > other person is not authorized. If you are not the intended 
> > recipient please notify us immediately by returning the e-mail to 
> 
> > the originator.(A) 

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