Let me ask you this: what causes a financial boom? In other words, economic fundamentals held the same (population, real productive capacity, etc.) what causes the boom?

In this case, technical innovation. The horrible combination of those terrible liberal universities and always wrong scientists in high priced California.

The STEM sections of the universities produce the innovation. They have little interest in liberal politics. Very little of the talent goes into the humanities.

In this case, technical innovation. The horrible combination of those terrible liberal universities and always wrong scientists in high priced California.

Your "over65/under 65" graphs really suck.

real GDP. Nominal GDP is a different beast.

Incorrect. Technical innovation led to an increase in real GDP. Nominal GDP is a different beast. Guess again and think about it this way: what provided the fuel for the eventual fires that were the Dot-com bubble and the housing bubble?

Fine, congress which is controlled by the GOP is spending uncontrollably after years of uncontrollable spending during the Obama years.

I guess what I am after is why does impending problems for Dem cities and states give you guys a boner while you generally ignore the mess federally?

Seems to me that spending is out of control all over the place. Is one worse than the other?

I don't know if you can completely separate the two. If universities were just a technical grindhouse, I don't think you would get the same results. Students should be exposed to a variety of topics and experiences outside of their expertise.

I remember overhearing a guy at a bookstore in Sunnyvale, CA around 1991. I guess he was one of those prepper guys. He said was waiting for the economic collapse. He was selling all his stuff and building a bunker. He gave all kinds of reasons, high taxes, bad government, illegal immigrants, etc.

Think about this, we were at the dawn of one of the greatest financial booms in world history and this guy was waiting for the economic downfall of society.

For both NY and IL the dependency ratio is increasing which is bad for the finances of those states... which are already in poor shape. That's kind of the important point I'm making.

I actually strongly doubt that Ai will dwarf the impact of demographics. It's just really hard to mute the lifecycle-driven borrowing, saving, investment, and consumption decisions of 7 Billion+ consumers. I've read up on the topic of Ai quite a bit and it doesn't seem we're any closer to General Ai than we were a decade ago. Narrow Ai's have come a long ways and have already started affecting the job markets in certain professions... but I don't see the world suddenly lurching because of Ai.

Quantum computing is worth watching as that field has the potential to revolutionize several industries (healthcare in particular) by solving once intractable, incalculable problems in a matter of seconds (I'm simplifying here).

But neither Quantum Computing nor Ai will fix the imbalance between young and old, male and female in China. Question: how long does it take to increase the number of twenty-year -olds in a country? Answer: twenty years and nine months. The architecture of our global financial system was built on a certain lifecycle of production and consumption and therefore for it to function properly in the long run it needs a certain demographic profile. For the past 100 years life expectancies have steadily increased around the world and this has led to increased capital formation and therefore cheaper capital. Again, this isn't a one-way street. Keep pushing up life expectancies and eventually you get to a point where it makes capital more expensive.

Could you imagine a large European employer like Peugot or ThyssenKrupp suddenly having to pay "normal" interest rates while demand for their products drops? That's the sort of future they face.

Wow that's Chris Hamilton's work verbatim. I wonder if he's aware. In meetings for the balance of the day, more later.

Doesn't really respond to FIshyJoe's comment, does it? It is merely a screed which oversimplifies and demonizes one area, on a topic wholly unrelated to the one at hand, i.e. the importance of university education (specifically STEM) in SIlicon Valley. Blaming higher education for the economic collapse seems to be a different thread. Do you live in Silicon Valley? The answer of how educational choices play out here is much more complex. Lots of liberal arts majors work in multiple industries here.