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>> Pension funds inherently depend on population growth to avoid shortfalls.
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>Pension funds inherently depend on increases in production. Population growth is one factor, but technological development can also increase production. Interestingly, capital returns and population growth are (unquestionably?) on exponential curves. So, are production factors too slow to evolve along with the exponentials? Maybe they are, because of waste, lack of recycling, raw resources decline and environmental damage. >> The other near-ponzi scheme is the real estate market. In my city of Toronto, average real estate prices have gone from 2x average income in 1972 to 16x average income today.
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>Hello from a Vancouverite! I broadly agree with this point, and I'm not sure how to work our way out of a housing bubble beyond popping it and dealing with the aftermath. Too many people are invested in the status quo, so any politician who tries to pop it will be crucified for destroying the savings of a large portion of the population. You could argue that in the same time frame, world population has more than doubled, and because the cost of capital is a lot cheaper elsewhere than in Canada, pressure on attractive living space in peaceful and stable countries has increased exponentially. At this point, the "liberal" view on capital flows and capital control, the fuel of foreign direct investments of Western countries into overseas properties since WWII, came back to bite the originators of the idea in the ass. |