Why The World Economy Is Likely To Collapse (In 1 Simple Chart)

Tyler Durden's picture

Submitted by Chris Hamilton via Econimica blog,

No difficult economic terms, no tough charts, just simple math.

1 - The worlds population of under 40 year olds (excluding Africa) has essentially peaked (chart below...bars represent 0-40yr/old population, dashed lines UN future estimates).  What is interesting about the under 40 year old population is that they are responsible for about 97% of all pregnancies / births.  It's not impossible for 40+ year old women to have children, just statistically very rare (particularly outside the developed world).

Ok, we've established the global under 40 population (excluding Africa) has essentially peaked...now we lay out the chart below that a shrinking population (above) isn't replacing themselves.  Chart below shows world fertility rates, again breaking world fertility (ex-Africa) from the African fertility rate.  The world (ex-Africa) has fallen below the 2.1 births per female replacement level...and even Africa is rapidly slowing.

A flat to shrinking child bearing population that is not reproducing at a rate to replace themselves and the fertility rates continue to fall.  This all points to the potential the low UN 0-40yr/old population estimate could be fairly accurate (chart 1, lower bound).  With either the medium or low estimate, the UN is telling us they expect a massive depopulation of under 40 year olds world-over.  Somewhere between 1 billion to 2.5 billion fewer under 40yr/olds by the turn of the century & perhaps well in excess of a 50% decline (except for Africa?!?).  I lay out why the Ex-Africa approach to viewing global economics makes sense, HERE.

The next three charts show annual global population growth, excluding Africa (the charts show average annual population growth per five year periods).

Chart below, (1) annual population growth clearly peaked in the '85-'90 timeframe at about +75 million year over year growth, and 2 - the makeup of that growth has entirely shifted from primarily among under 40yr/olds to primarily 65+yr/olds.  These trends are about to get much worse, from an economic and consumption standpoint.

The chart below is focusing on the changing nature of the annual global population growth.

Finally, a quick look at select years to show the changing nature of the global population growth...shifting from nearly entirely growth among the young to declines among the young only somewhat offset by the elderly living far longer.

All the interest rate cuts and debt has been undertaken under the paradigm that it would be more easily repaid in the future...but now we've come to "the future" where there are fewer of us to service the debt, buy homes, buy cars, consume our way to prosperity...or pay the taxes to keep the social systems solvent.  Basically, we are doing our best Wile E. Coyote impression...we've gone over the cliff but somehow haven't realized it quite yet.  What this has looked like in the US and globally...HERE.

Of course, the flipside is the 40+ year old world (ex-Africa) population is set to continue soaring (chart below).  Unfortunately, by age 65, the population consumes at about 70% of it's peak earning years...and by 75, consumption falls to somewhere around 50-60%.  The elderly are credit averse, have made their major life purchases and spending (kids, homes, college) and turn to net sellers in retirement.  Absent a growing population of young to buy their assets (IRA's, homes, etc.), we have a small problem (central bank asset purchases to the rescue).  As for Africa, the population growth there generally consume at a rate of 5-10% the consumption of the depopulating young they are replacing.  Global economic activity and consumption are likely to fall off a steep, high precipice.

The implications economically, financially, societally, etc. etc. of a collapsing population of young and soaring older population should be ringing alarm bells...but instead our politicians seem officially mindless (or intentionally misleading the populace) in the face of a cataclysmic shift.

Just to make the point...here is what the shift looks like for the US.  The breakdown in growth among 25-54yr/old employees (blue line) coinciding with interest rate cuts (black line) and massive federal debt increases (red line). 

The chart below shows total federal debt apportioned per the nearly 100 million 25-54yr/old employees (red columns) vs. the non-growth in wages shown by the real median household income (green line).

 

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Hopeless for Change's picture

Producers are being outpaced by "Consumers".  The Ponzi Scheme is unraveling

froze25's picture

I read this and have prepared but I got to tell you I am becoming a bit tired, I have heard this for the last 8+years now.

de3de8's picture

Projections out to year 2100?! Yeah ok, about as reliable as climate change projections.

JohnG's picture

Someone should do something about those goddam africans....

The Saint's picture
The Saint (not verified) JohnG Jan 24, 2017 4:33 PM

(In 1 Simple Chart)

I count 8 charts.  How do you call this 1 Simple Chart?

SeuMadruga's picture

Maybe the other 7 weren't simple...

Oracle of Kypseli's picture

Good academic study with no present value.

There is no ETF for that!

TuPhat's picture

I think ZH thinks I am simple.

peippe's picture

Recap: We're screwed.

& not in a good way. : l 

Eeyores Enigma's picture

Yes we must sustain infinite growth on this finite planet. There is no option. I am sure it will all work out just fine cause...we gots technology.

Akzed's picture

The charts start in the 50's to 80's, and this represents the norm for all of human history?

hedgeless_horseman's picture

 

Tax the obese (nobody wants to fuck fat people).

Subsidize hot yoga, raw oysters, and Champagne for white people.

Must I do all of the thinking around here?

Ledlak's picture

You said, 1 simple chart, I count 8. :)

remain calm's picture

Those Africans love repruducing.

IReallyDontCare's picture

That's why they are called Jungle bunnies, they breed like rabbits.

Uzda Farce's picture
Uzda Farce (not verified) IReallyDontCare Jan 24, 2017 8:41 PM

Especially when somebody else gives them free food, free housing, and free medical care...

peippe's picture

by that chart, it's easy to fix:

All workers hand over four years' wages to U.S.A.

Debt retired. Simple.  Work for free. Four years. Do it.

Kickaha's picture

Could you work eight years and cover my four?

peippe's picture

you & I need some douche to work sixteen

to cover ours, Then all is good. 

We're gonna need at least one H-1B visa,,,,,

Anteater's picture

Last Chart completely explains the 1998 Bank-Brokers Coup, the 2001 Pentagon Coup and 2011 TBTF FSB Coup.

At this point we're so totally fucked it's not worth waiting for the axe to fall. Google 'Headless Mike The Chicken'.

That's USA under Trump. We got about 18 months before his Satanic Luciferians start turning us into dog food.

Cole The Bar's picture

The sooner it collapses the better for us young people. I want time to rebuild a little wealth after the previous generations' combined fuck up ruins everything before im too old to do anything useful

TuPhat's picture

I'm already too old but I agree with you.  The sooner the better.

Lies All Lies's picture

Yep. Bring  on the Fourth Turning (closer than most think... and well deserved)

Anteater's picture

I just looked at a 640sf condo, built in 1980, that previously sold for $635 a square foot. It smelled like a 37 year old boxing gym, had a Hot Point electric stove and baseboard heating, facing the freeway, with no balcony. Basic mausoleum style.

For perspective, you can build a brand new SOTA hospital  with LEED Gold certification for less than $634.

Don't count on this generation leaving your generation anything other than $250,000 per in synthetic, fraudulent collateralized bailed-out gambling debts, and a old ghetto condo, with every other country on earth rejecting your visa request, even Canada.

Mil.Gov Job or Die Trying!

TeethVillage88s's picture

Can older guy take up with young women, could we bring that one back.

William Finn's picture

I am pretty fat, but I would still fuck myself.

Exalt's picture

Would you fuck me? I'd fuck me so HARD!

Kickaha's picture

You must not have heard about the BBW phenomenon.  No, I don't understand it, either.

 

bentaxle's picture

I was hoping there would be a bonus chart.

englishvinal's picture

Your one detractor must be a member of the "My fabulous, fat life Club"... dying of diabetes and rationalizing why no member of the OPPOSITE sex wants to "touch" or "feel"...

Herd Redirection Committee's picture

What's going to happen to all those Africans?

r/K selection suggests their reproductive rate will not slow as much as the West imagines (i.e. have a few kids and raise them well, or have many kids with many women, and don't bother spending much time on them at all, sink or swim-style)

The world needs a new paradigm.  Currently there is so much waste.  Food gets thrown out.  Smart phones 18 months old get thrown out.  Light bulbs last what, 3 months?  This is the 21st century???

Planned obsolescence has meant 'consumption' is at artificially high levels to begin with IMO.

rrrr's picture

Well the Maya and the Aztecs are waiting tables and working in the kitchens in restaurants in San Antonio so I guess the North American Blacks that were brought here as slaves from Africa will be shucking oysters and catching lobsters in New England, and of course selling them to each other because there won't be any white people, except me and a few others, because I'm one of the only ones paying attention. Meantime the main problem is where to live. Most white people are still asleep, and you don't want to live near them because they tend to get upset when their eyes are open. They believe in such things as a man walked on water and that they're going to heaven where they'll have big wings and play the harp. Have you ever played a harp? They are the most horrible musical instrument to play ever invented. And if you had wings big enough to fly, your chest muscles would stick out several feet in front of you. And anyway, you don't play the harp now, so why would you want to play the harp after you're dead. I can't speak for the average dead person, but as far as I'm concerned, death being what it is, I'll keep my thoughts on being alive, thank you very much. And that means figuring out where is the best place to live in the meantime, and what I have to do to keep myself from being surrounded by people of darkness.

TuPhat's picture

You don't know what people of darkness are so you should move to California where the 'enlightened' ones are.  They will welcome you to join them before they sink into the ocean and you won't have to worry about any wings getting wet.

MalteseFalcon's picture

It would be easier to slow the African birth rate by introducing lesbianism there.

Maybe some NGOs could hold classes on scissoring in Ubangi-ville.

kellys_eye's picture

Fertility rates??

Most sensible people adjust their family size to suit their income - and it shows.

Akzed's picture

Human fecundity is inversely proportional to female literacy rates. Compulsory education is killing us.

Kidbuck's picture

Yeah, once the wimmin learned blowjobs and masturbation in school it was all over for civilization.

halcyon's picture

Noo problem! Everybody will just keep on working till they're 100 years old, on those dead-end waiter, cleaner, garbage collector and US military foreign war jobs.

Bring on the prosthetic limbs and AI overrides!

The 0.01% will not give away their power easily...

 

logicalman's picture

Life's a dead end kinda thing, so all jobs have to be.

One thing the rich have in common with the poor.... They die.

 

The Saint's picture
The Saint (not verified) Jan 24, 2017 3:42 PM

The obvious solution in the decades ahead is to put a sterilazation agent in the water in Africa and create babies in testubes in western societies for adoption.

It will be a simple fix for science in the near future.

 

HillaryOdor's picture

Yes the obvious solution of too much government is to get government more involved in everyone's lives, forcibly sterilizing people.  We've had TOO MUCH freedom, see?  It's not that government and politicians made promises they can't keep.  

Where in the hell do you people come from?

cheka's picture

apply for sec 8, foodstamps = sterilization to collect

HillaryOdor's picture

Just get rid of sec 8 and foodstamps.  You're on your own.  It can't happen all at once, but we need to slowly transition that way.  These people with no skills should be out working farms in rural areas anyway because we shouldn't be shipping food 1000s of miles around the globe before it gets to us.  They never should have been herded into the cities in the first place.  And if you don't like your station in life, tough.  Get some skills.  Education is free on the internet these days.  There are plenty of libraries.  And if you think your poverty gives you the right to get violent and rob people you should be put to death.  We used to hang horse thieves, not give them room and board and then welfare.  The problem is not too many people.  The problem is too many people think everyone deserves access to resoures they don't own simply because those people exist.

Akzed's picture

https://secure.piryx.com/donate/ISIFBmb1/Maryland-Campaign-for-Liberty-I...

 

They aren't going to ge trid of Section 8, they're going to move Section 8 to you.

Dixie Rect's picture

This is all based on the assumption that those JackOffs at the UN have any clue as to what is really going on in the world.