As soon as interest rates drop, the markets are going to turn positive, which is going to be interesting, considering how much volatility there is in the world currently. This volatility means opportunity for investors, and there is going to be an increasing amount of money pouring into investments through the transfer of wealth from older generations to young, starting right about now, with about 73 trillion changing hands in the next couple decades.
That is stupid money.
Not because the money is stupid, but because it is going to land in hands that have been conditioned to be consumers, not investors, and that means a lot of it is going to be spent on depreciating purchases, not appreciating. Not only that, they have also been conditioned in gamified experiences, where purchasing itself is entertainment and they like games of chance. The fundamentals don't matter, which means even their investing is going to create volatility in the marketplace, and the losses are going to follow suit.
So are the gains.
As I was talking with my friend the other day, those who are able to get debt free and continually invest into low-risk consumer areas are going to do very well, because while individual companies will see larger gains and falls, consumption is likely to increase. The range of companies that offer stable products and service will continually return.
But, to be a consistent investor, one also has to have a relatively consistent temperament, and that seems to be a dying trait in the young. My friend has two boys and like all brothers, they fight. But, coming from a family of three older brothers myself, there was a difference in the way they fought. The competition was still there, but so too was a level of emotional instability that I don't remember seeing in my brothers, or in those of my friends when I was young. They seemed far more emotionally volatile in the way they reacted and interacted with both each other, and their parents. And their parents aren't incapable and absent.
What is the average emotional state of various generations now?
Averages are important to note, because they are going to be more indicative of behavior than the peaks and troughs that get highlighted in the various medias. For instance, a lot of people think the young are creative, but there is an availability bias in the opinion, because what they are largely judging it on is globally cherrypicked representatives on social media. Sure, out of eight billion people there are plenty of creatives, but out of eight billion people, what is the average creativity level, ability level, and mindset?
It is those averages that will be the ones making the decisions on where they spend their portion of that 73 trillion and it will be those averages that will also be the ones voting on governance, and supporting businesses. All of these things tie together with myriad other things to create our society, communities and of course, the economy that tracks our activities.
That is really all an economy is, isn't it?
When they say the economy is doing well or the economy is doing poorly, it makes it sound like the economy is something that operates outside of us, that it is its own entity. That is not the case. The economy is a bit like a blockchain in the sense that all it does is represent the transactions made on it. It is impartial to what those transactions actually are, which is why people can manipulate and screw over others, making themselves extremely wealthy to the detriment of the masses, and generate wealth as if it is representative of success, even though society, communities and individuals are increasingly suffering.
The current economic practices are failing to produce better outcomes and experiences for the majority of people and are instead making life more difficult. The economy isn't to blame, because the economy is just those transactions. "Changing the economy" as I often talk about is a convenient misnomer, because the economy can't change in the same way that nature can't stop being nature - it is what it is, no matter what the current conditions are, or what the future conditions will be.
What this means is that there is a massive opportunity to reconfigure the economy to provide better human experience in the coming few decades, by changing where those trillions go. However, the direction isn't likely going to change much because the majority of people who get those inheritances will do the predictable thing and will follow their conditioning, which will inevitably put more wealth into the hands of the already wealthy.
Just imagine, all that wealth transfer, and most people still won't get themselves out of debt. And as a result, there will be more volatility in the markets, more opportunity, and more emotional instability from individuals.
Taraz
[ Gen1: Hive ]