Inequalities: Wealth and Age

Dion Rabouin at Axios:

The economy and stock market are diverging.

• The Nasdaq's 42% rise year to date in the face of a U.S. economy expected to contract by 3% is perhaps the most jarring example yet. But economic growth has been softening for years as equity prices — especially for Big Tech companies — have boomed.
• Since the global financial crisis in 2008, U.S. GDP has averaged 2% growth, while the Nasdaq has averaged an 18.1% gain, not including 2020.
• From the Nasdaq's inception until 2009, the index averaged a 10.6% annual gain while the U.S. economy had grown by an average of 3.1%.

The fortunes of the young and old are diverging:

• Higher housing costs mean more equity and higher resale values for homeowners, but also higher rent. Similarly, advances in health care mean older people are living longer and able to accrue the benefits of rising asset prices rather than passing them on to the next generation.
• That directly benefits older Americans largely at the expense of younger ones, who are moving out of large metros like New York and LA on the coasts and toward places like Phoenix and Denver that still offer vibrant cultural life but lower rent prices.
• The median age of all U.S. homebuyers has risen from 31 in 1981 to 47 in 2019.
• The slow recovery in the labor market and real economy also is impacting childbirths, researchers at Brookings say.
• They estimated in June that the U.S. would see 300,000-500,000 fewer births this year. They noted in an update last week that the declining availability of child care and school closures could be worsening the expected 2020 "baby bust."