Lets All Learn How to Fish To Sustain LT Economic Growth Michael - - PowerPoint PPT Presentation

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Jun 12, 2023 127 likes •433 views

Lets All Learn How to Fish To Sustain LT Economic Growth Michael Falk, CFA, CRC Partner @MSFALK Lets all learn how synopsis Todays economic growth challenges will become greater in the future if only due to the worlds

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“Let’s All Learn How to Fish… To Sustain LT Economic Growth”

Michael Falk, CFA, CRC Partner

@MSFALK

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Let’s all learn how… synopsis

Today’s economic growth challenges will become greater in the future if only due to the world’s agedness, fertility levels and entitlement policies. However, those same challenges could be overcome with more thoughtful policies along with a culture of responsibility and

appreciation. The book reconsiders what makes us “healthy,

wealthy and wise,” and focuses on how we might re-imagine health care, retirement and education policies to usher in a new ERA of sustainable, long-term economic growth.

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Good policies… have both

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A little perspective…

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26 14 21 14 28 28 14 6 35 12 29 34 28

482 726 276 280 169 158 683 261 652 204 335 495 409 AUSTRALIA CANADA FRANCE GERMANY ITALY JAPAN KOREA MEXICO SPAIN TURKEY UNITED KINGDOM UNITED STATES ADVANCED G-20 COUNTRIES

NPV OF IMPACT ON FISCAL DEFICIT OF 2008 CRISIS AND AGE-RELATED SPENDING TO 2050; % OF GDP

Crisis (2008) Age-related spending

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Clarity…

Growth = % Δ Workers + % Δ Productivity

On the number of Workers Fertility Employment / Participation Net migration Retirement On the amount of Productivity Health Education / Skill relevancy Capital

… will the robots be our rescue?

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Workers will work longer So sayeth so many… … To solve their (our) shortfalls

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See…

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BUT…

BLS Civilian Labor Force Participation Rate, > 16yrs, 1/85-11/16

67% 66% 65% 64% 63% 62%

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… NOT all workers are able

27% of workers who are ≥ age 58 perform

physically demanding jobs that cause them to age faster than those with less physically demanding

nes.
Another 18% perform jobs in difficult working

conditions that also place strains on their health.

… these “less capables” do NOT include “job-

unables”

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Workers MAY work longer IFF… they have:

1. Healthy aging

and the

2. Requisite skills

… To solve their (our) shortfalls

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Let’s retire retirement (as we know it)

Work saves us from three great evils: boredom, vice, and need.

Voltaire (1694–1778) Candide 1759

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72-73

What will work? Got Jobs or compassion or… ?

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Proper netting… MATTERS!

Social Security provides…

2014 data / September 2016 SS release

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Bigger/deeper pools… PLEASE!

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The futur ture e of retireme tirement Three big ideas that could reshape the U.S. retirement system Russell Investments July 2015

“Super” solutions exist…

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A cure for health care

The only way to keep your health is to eat what you don’t want, drink what you don’t like, and do what you’d rather not.

Mark Twain, Following the Equator, 1897

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Curing today’s sick care

Incent health

Personal, catastrophic

policies with HSAs;

Free, required routine

care; improved “marker” discounts;

1 system, multi-faceted

local access, distant services; …

Technology

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Cost, coverage limits

beyond “xx” age

EOL docs

Atul Gawande, “ . . . our decision making in medicine has failed so spectacularly that we have reached the point of actively inflicting harm on patients rather than confronting the subject of mortality”

Palliative & hospice care

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Learn to learn (and never stop)

Education is the most powerful weapon which you can use to change the world.

Nelson Mandela, speech given 16 July 2003

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Ages 0-8!

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Goodbye to the bottom…

5% and…

HELLO +$250,000

6-10% and…

HELLO +0.87 GDP

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Why Fish?

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Demographics do NOT have to be destiny

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Give a person a fish and you feed him or her for a day; teach a person to fish and you feed him or her for a lifetime.

My paraphrase of the proverb attributed to Maimonides (1135–1204)

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Michael Falk, CFA, CRC is a Partner with the Focus Consulting Group.

Michael specializes in helping investment teams with improving their investment philosophy, process and execution techniques, and investment firms with their strategic planning. He has been a Chief Strategist on a global macro hedge fund as well as a CIO in charge of manager due diligence and asset allocation for a multi-billion- dollar advisory. His background includes extensive asset allocation research, portfolio development expertise and a multi-faceted understanding of behavioral finance and retirement issues. Apart from his FCG work, Mr. Falk is the author of the CFAI Research Foundation Monograph “Let’s All Learn How to Fish… to Sustain Long-term Economic Growth.” He is also part of the CFA Institute’s Approved Speaker List, and teaches on behalf of the CFA Society of Chicago in their Foundations of Investing program. In the past, he had been a contributing member in the Financial Management Association’s (FMA) practitioner demand driven academic research initiative (PDDARI) group and taught at DePaul University in their Certified Financial Planner (CFP) Certificate Program. He is frequently quoted in the financial press. mfalk@focuscgroup.com Twitter – @Msfalk