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Demographics School

Demographics School. presented by Rodney Johnson & Harry S. Dent Jr. Dent Research. HS Dent. Independent Economic Research Company Forecast economic change based on three key tools: 1. Demographics and demographic trends 2. Predictable consumer spending patterns, and

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Demographics School

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  1. Demographics School presented by Rodney Johnson & Harry S. Dent Jr. Dent Research

  2. HS Dent Independent Economic Research Company Forecast economic change based on three key tools: 1. Demographics and demographic trends 2. Predictable consumer spending patterns, and 3. Technological innovation acceptance rates

  3. Demographics

  4. Strong Uptrends and Downtrendsin Births

  5. Average Immigrants per Year by Age 1945-2000 Source: US Census Bureau

  6. The Immigration Adjusted Birth Index Immigration Adjusted Births Source: Dent Research

  7. Demographics How many people born in each year The numerical effect of immigration Composition of US population by age groups Where the information comes from (NCHS, Census) Websites of interest: www.cdc.gov/nchs/www.census.gov

  8. Predictable Spending Patterns

  9. Average Annual Family Spending by Age (5-year age groups) 46-50 Spending Age

  10. Change in Spending at each Age & Stage of Life 46-50 Family, College Kids 22-30 Young Married 31-42 Young Family 50+ Empty Nesters 18-22 Single 60+ Retired

  11. Boomers Are Not Different! Front end of Boomer generation began retiring in 2003 Wave continues through 2025 Spending STILL PEAKS approx. age 48-50

  12. The Adult Life Cycle Education (college, trade school, etc.) Workforce Apartments Marriage Children Home purchase Second home purchase Children leave Pay down debts Save for retirement Vacation property Retirement property

  13. Only Works for Some Economies must be Industrialized Modernized Democratized in terms of consumers holding funds

  14. Who Spends What in the Economy2012 Source: U.S. Department of Commerce, Bureau of Economic Analysis, 2013

  15. Who Spends What in the Economy, 2002-2012 Data Source: Bureau of Economic Analysis, 2013

  16. Composition of U.S. Gross Domestic Product, 1929-2012 Source: Bureau of Economic Analysis

  17. Who Spends What in the Economy2012 Source: U.S. Department of Commerce, Bureau of Economic Analysis, 2013

  18. Share of GDP, Accounting for Government Social Programs and Financial Recoveries Data Source: Bureau of Economic Analysis, HS Dent Research, 2013

  19. Percent of Personal Income Contributed by Government Programs Source: BEA, HS Dent Research, 2013

  20. Total Government Transfer Payments 2000-2012 In Billions Data Source: Bureau of Economic Analysis, 2013

  21. Americans on Food Stamps2006-2012 Data Source: USDA, 2013

  22. Americans on Disability Data Source: SSA, 2013

  23. Real Personal Consumption Expenditures 1995-2012 Billions of Chained 2005 Dollars Data Source: Bureau of Economic Analysis, 2013

  24. Real Personal Consumption Expenditures 1995-2012 Missing Growth Billions of Chained 2005 Dollars Data Source: Bureau of Economic Analysis, 2013

  25. Composition of U.S. Personal Consumption Expenditures Data Source: Bureau of Economic Analysis, 2013

  26. This Is What You See

  27. Potato Chip Purchases by Age $ Per Year Age of Head of Household 42

  28. Motorcycle Sales by Age 45-49 $ Per Year Age of Head of Household

  29. The Harley Wave Harley Davidson Annual Units Sold Immigration-adjusted Births Lagged 45 Years for Peak Spending Data Source: HS Dent Research, U.S. Census Bureau, Bloomberg, Harley Davidson, 2013

  30. Harley Davidson, Units Sold1986-2012 Data Source: Harley Davidson, Hog Fact book, 2013

  31. Harley’s Biggest Problem “Harley Davidson’s Aging Biker Problem” Fortune, 9-17-10, Alex Taylor “…it is struggling against a foe that not even cost-cutting nor brand loyalty can overcome: demographics. Its current owners are getting old, and not enough younger ones are coming up behind them.”

  32. Harley Davidson Share Price1987-2013 Data Source: Yahoo! Finance, 2013

  33. Personal Care Services For Females, Including Haircuts Source: Consumer Expenditure Survey

  34. Spending on Drugs Source: Consumer Expenditure Survey

  35. Electricity Source: Consumer Expenditure Survey

  36. Fast Food for Lunch Source: Consumer Expenditure Survey

  37. The Immigration Adjusted Birth Index Immigration Adjusted Births Source: Dent Research

  38. The Spending WaveBirthsLagged for Peak Spending 30,000 Dow Adjusted for Inflation, Log Scale Immigration-adjusted Births Lagged for Peak Spending Data Source: HS Dent Research, U.S. Census Bureau, Bloomberg, 2013

  39. The Spending WaveBirthsLagged for Peak Spending Dow Adjusted for Inflation Immigration-adjusted Births Lagged for Peak Spending Data Source: HS Dent Research, U.S. Census Bureau, Bloomberg, 2013

  40. Age & Stage of Life Determine Spending Patterns As we move through predictable stages of life, which correspond with different ages, we change our spending in very predictable ways. What we buy at each stage is predictable and consistent. This information can be used to forecast how spending will change in the years and decades to come. Website of interest: www.bls.gov/cex/

  41. Daily Consumer Spending2008-2013 Data Source: Gallup.com, 2013

  42. Past Forecasts “For the 1990s and Early 2000s – Our Greatest Boom: Dow Rises to 10,000.” Our Power to Predict, back cover (1989) “After those enormous deficits into 1992, the government will likely be in a balanced budget or surplus by 1998-2000.” The Great Boom Ahead, pg 62 (1994) “The next great depression will be from 2008-2023.” The Great Boom Ahead, pg 16 (1994) "No amount of government stimulus will prevent it…" The Great Boom Ahead, pg 35 (1994)

  43. Contrary to popular belief, Americans really can pass The Marshmallow Test

  44. We’ve Seen This Movie Before, Just Look To The East

  45. Japan Birth Index47-Year Birth Lag Births (millions)

  46. Japanese Nikkei IndexJan 1984 – Jan 1990

  47. Japanese Stock Market vs. Change in Consumer Spending 1987 – March 2013 Nikkei Average Change in Consumer Spending Data Source: Japanese Family Income and Expenditure Survey; Yahoo Finance, 2013

  48. The Rise of Non-Regular Workers in Japan Percentage of Non-Regular Employees Source: Ministry of Internal Affairs and Communications (2007), Employment Status Survey, 2012

  49. Percentage of Workers Earning Less Than $20,000, by Category Only 1% Earn More Than $30,000 Less Than 2% Earn More Than $30,000 Over 67% Earn More Than $30,000 Source: Ministry of Internal Affairs and Communications (2007), Employment Status Survey, 2012

  50. Percentage of Workers Earning Less Than $20,000, by Category Source: Ministry of Internal Affairs and Communications (2007), Employment Status Survey, 2012

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