Fundamental Analysis

Demographics is the collection and analysis of broad characteristics about groups of people and populations. Referring to the socio-economic information expressed statistically, it tackles employment, education, income, marriage rates, birth and death rates. Governments and corporations use demographics to learn about a population’s characteristics for policy development and economic market research and future trends. With the combination of the internet, data, and artificial intelligence, demographics plays a big role in amplifying the business sector, structural productivity growth, living standards, saving rates, consumption, and investments.

  • Can also be used to predict social changes
  • Claimed to be the most powerful economic force
  • Demographic trends can be used to predict market and economic trends years (or even decades) in advane
  • Massive Central Bank Intervention after 2008 has negated the impact of demographics and distorted markest true nature
  • Immigration is good for demographics - it fuels growth
    • Think of 1920s, etc.
    • Lack of Immigration hurts (1930s)
  • Technology & Disruption can have a huge impact on demographics
    • Better Tech/Healthcare = Longer Lives = Longer Working Lives = Bigger Economy
    • Longer lives have been a huge driver of economic boom since 1900

What Can Demographic Be Used For

  • Predicting population size
  • Predicting economic growth
  • Predicting stock market prces
  • Predicting interest rates
    • Workforce growth is a main driver of inflation
    • More workers = more demand for goods, money, etc.
    • Young people costs a lot, but produce nothing
  • Predicting demand for various items or industries (Spending Waves)
    • Ex.  Motor Cycle Demand
    • Ex. Recreation Vehicle Demand
    • Ex. Potatoe Chip Demian
    • How? The US Bureau of Labor surveys US citizens on 600 categories of spending (from birth to death)
    • Allows us to see at what age people buy things and what demand will be based on demographjics
  • Predicting Inflation
    • Young people consume everything & produce little
    • Workforce Growth + Lag Time (for time to ramp up/train) is a great indicator of inflation