Monday, May 19, 2008

Nothing Complicated About Finance?

That is an understatement, but one made in a single paragraph:
"There is nothing complicated about finance. It is based on old people lending to young people. Young people invest in homes and businesses; aging people save to acquire assets on which to retire. The new generation supports the old one, and retirement systems simply apportion rights to income between the generations. Never before in human history, though, has a new generation simply failed to appear."
I never thought of it that way, but it is simple and quite correct (in my estimation at least).

Quick update from the end of the article:
"Economics simply does not offer a solution to a lapse of the will to live among some of the world's richest economies. The Europeans are paying for their own nihilism. Having invented the perfect post-Christian society with cradle-to-grave services, they have not found anyone willing to live in it, except for the immigrants who well may inherit it from the disappearing locals. "
Can I offer an, "indeed"?

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