Monday, May 16, 2016

Which Countries Will Be 
Tomorrow's Winners & Losers?
Charles Hugh Smith* explores the links between geography & prosperity, stability & geopolitical risks .. "Countries with a large and highly productive young cohort of workers supporting a small generation of retirees can save and invest the surplus capital being generated. If this capital is invested in productive assets such as technology and innovation, the nation’s wealth expands. Demographics and geography are destiny largely because they define cost structures and capital flows: if costs are high—from the burdens of transport, and defense and imported essentials, or from caring for a large cohort of retirees, or both—there will be less capital available to invest .. Meanwhile, nations with high costs and low capital accumulation due to unfavorable demographics and geography will suffer low rates of growth which make them unattractive to foreign capital, leaving them capital-starved .. In today’s world, cultural and political systems influence birth and death rates. Japan’s low birth rates do not result from a shortage of food, and the decline of longevity and birth rates in Russia following the collapse of the Soviet Union were not the result of famine but of political instability. Studies have found that high birth rates decline as the educational and work opportunities for women of child-bearing ages increase. Broadly speaking, demographics is no longer driven by feast or famine, but by cultural, economic and political dynamics such as educational opportunities for women, political instability and the cost of raising children. Geography has a hand in these dynamics. Societies with unfavorable geographies may struggle to maintain surplus capital and political stability."
LINK HERE to the article

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