Bewdy! I'm always happiest when we're predicting doom. So who's read Robert Shiller's *Irratyional exuberance*? He reckons shares are the last place to put your pension money - that when the bubble goes we're in for a decade of depression; and that we're in the worst bubble ever (lotsa stuff on the charts of the 1901, 1929 and 1966 'booms' and ensuing droops), with a DJI up 200% in five years as opposed to real personal income and GDP increases of 15% and a corporate profit increase of thirty. Strikes me as just the sort of thing that'd make baby-boomer punters nervous. A lot of them won't have the time to ride this droopy decade, after all. If they did pull out (and they're a mightily significant demographic for the next fifteen years), that'd make a big difference. The question which occurs is, if these people were to take their dough out of the share markets, is there anywhere for 'em to put it? Shiller wants a host of new investment products out there quicksmart, so punters can hedge their asset values, come the bear charge. Which implies there ain't too many options right now. So have we a sustained bubble because there's nowhere else to put people's retirement money? And wouldn't that militate against institutions offering hedging products? And how would Bush's social security plan play out on this underlying question mark (he wants to stick public funds on the markets, no?)? And, should he become president, wouldn't the republican Houses pass his plan? And wouldn't that all combine to feed the bubble for another few years, or would people just take the appreciations after that big inflow, and then get outa town before the fans hit the shit? Irksomely full of questions, I know, but the West's demographics, the Shrub in the white House, combined with a long-blown bubble, fragile national accounts, and unprecedented personal debt - well, it does look like one helluva confluence of portents, doesn't it? Oh, and how do the bear-grunts of a personal friend of the sainted Alan Greenspan, with impeccable Ivy League credentials, play in the US business media? Cheers, Rob.
