Mideast, outside of oil, have not been growing rapidly. If the entire de-
veloping world increases its growth to 6 or even 8 percent, then there
would be sufficient productivity in the rest of the world to provide the
goods that the baby boomers need and then buy the assets the boomers
will have to sell; the retirement age can remain at 62 or even decline, con-
tinuing its pattern over the past century.Attraction of U.S. Capital
Why would the developing world wish to acquire our capital when their
countries are expanding so rapidly? At the beginning of this chapter, we
learned that the best returns are rarely found in countries that grow the
fastest. Witness China’s dismal returns for so many years despite being
the fastest-growing country in the last 20 years. Investors can often find
better returns in slow-growing countries and industries.
To that end, U.S. capital markets have many attractive attributes.
Our country is still viewed as the fountainhead of innovation, discovery,
invention, and entertainment, and our institutions of higher education
are second to none. Our capital markets are deep, easy to access, andCHAPTER 8 The Impact of Economic Growth on Market Valuation and the Coming Age Wave 137
FIGURE 8–4
Average Retirement and Life Expectancy in the United States Since 1950 and Projected to 2050