“On net, the credit spreads do not, as of now, signal recession,” said Silvia. “Moody’s Baa spread is the dog that didn’t bark.”
The current spread has not broken above to a higher level on a sustained basis, as seen just before or during the early phase of a recession in past periods, said Silvia, citing the fourth quarter of 1998, first quarter of 2008 and the fourth quarter of 2018 as examples. But “the caution flag remains out” for investors, according to his note. Investors are worried that bank lending standards will become tighter, prompting a recession in the next year, he said. “As illustrated in the graph below, a sharp rise in the benchmark measurement of tighter standards does signal an oncoming recession,” said Silvia. “We saw this in 1999 and very sharp rises in 2007, and the 2020 period.”
DYNAMIC ECONOMIC STRATEGY NOTE DATED APRIL 19, 2023
7. U.S. Household Balance Sheets in Excellent Shape.
Torsten Slok, Ph.D.Chief Economist, Partner Apollo Global Management-US households are in excellent shape, the ratio of liabilities to net wealth has declined 50% since the 2008 financial crisis, and household leverage is currently at levels last seen in the early 1980s, see chart below. If the unemployment rate rises, consumer spending will slow down, but the starting point for US households is very strong.
8. Euro Large Cap 50 One Tick From Break Out Highs
$47 print new highs
50 week turning up about to go thru 200 week to upside.
1. Nasdaq 100 30x trailing earnings to 40x trailing earnings in 2 Months.
Following a 20% rally in the year-to-date, the tech-heavy Nasdaq 100 now trades at nearly 40 times trailing earnings, Verdad Weekly Research relays, citing data from Capital IQ, up from just over 30 times in early January. From Grant Interest Rate Observer https://www.grantspub.com/
2. History….Six Months After 20% Correction
From Dave Lutz at Jones Trading It’s been 6 months since the S&P’s low – “Since WW2, we found 13 prior periods in which the SPX made a major low after a 20%+ drop and then didn’t make a new low in the next six months .. Six and twelve months after,.. the S&P 500 was higher 12 times” says Bespoke.
Chartr For richer, for poorer New analysis of government figures by Pew Research Center reveals that women in opposite-sex marriages are increasingly earning more than, or the same as, their husbands.
The study found that men are now the sole or primary earners in just 55% of American marriages compared to 85% in 1972, with a large portion of those households now “egalitarian” — marriages where the husband and wife each account for 40-60% of the household’s total income. BreadwinnersOne of the more notable findings from the study is that 16% of opposite-sex marriages now have the wife as the primary or sole breadwinner. That’s a proportion that has more than tripled in the last 50 years, but was actually a slight drop on the equivalent study from 2012. The rise of wives as breadwinners is unsurprising in the context of wider societal shifts in America, as the female share of overall income in North America continues to rise, and women now account for nearly60% of college students across the country. However, while their share of marital earnings is on the up, Pew Research also found that women are still doing the larger share of work around the home too, spending ~2 more hours a week on caregiving responsibilities and more than double the amount of time on housework.
What does it truly mean to be rich vs wealthy? Is there a difference between them, or are they merely two sides of the same coin? While these terms might seem interchangeable at first glance (I’ve been guilty of this many times before), they actually represent two distinct mindsets that can significantly impact your financial future.
In this blog post, I will do a deep dive on the rich vs wealthy debate to debunk common misconceptions on the subtle, yet critical differences that set these financial lifestyles apart. By the end, you’ll not only have a newfound understanding of these terms, but also a clearer vision about which of these is right for you.
To start, let’s take a look at what it means to be rich.
Defining Rich
“Rich” typically refers to individuals who have a high income or possess a substantial amount of money. This status is usually characterized by:
A high salary or business income
A luxurious lifestyle
Expensive possessions such as cars, homes, and designer items
Short-term financial success
While there is no one-size-fits-all definition of what income level is considered rich, the top 10%, top 5%, and top 1% of U.S. household incomes are a good benchmark to consider:
Though these income levels could classify someone as “rich”, as I have mentioned before, factors such as age, education level, and where you live should also be incorporated into the discussion.
Additionally, it’s important to remember that having a high level of income doesn’t guarantee financial stability or lasting prosperity. In fact, a high income can create a false sense of financial security, leading individuals to overspend and neglect building wealth for the long term. In this sense, being rich isn’t about a particular level of income, but a consumption-focused mindset (and the luxury lifestyle that comes along with it).
History is rife with examples of rich celebrities and athletes that lost it all thanks to their poor financial choices. However, my favorite case study is The Vanderbilts. Not only did the Vanderbilts buy nine mansions on Fifth Avenue in New York City (some of the most expensive real estate in the world), but they also threw extravagant parties where they dined on horseback and regularly lit their cigars with $100 bills (in the early 1900s!). It wasn’t long before everything came crashing down in the Great Depression and they lost the bulk of their family fortune.
The key takeaway from their example is that prioritizing material possessions can lead to a precarious financial situation, even for the richest among us. This is why, as we’ll see in the next section, being wealthy requires a different approach to money management altogether.
Defining Wealthy
Being wealthy is about more than just having money. It’s about accumulating assets and resources that generate income for long-term financial security. This financial status is characterized by:
A diverse portfolio of investments
Passive income streams
Financial independence
Long-term financial planning and stability
Though we don’t have an explicit definition of “wealthy”, the net worth needed to be in the top 10%, top 5%, and top 1% of U.S. households, according to the Survey of Consumer Finances (SCF), is a decent proxy:
If you are shocked by these amounts, I wouldn’t worry. These net worth figures are highlydependent on age, education level, and your geographical location (just like the income numbers in the prior section). If you are younger, have less education, or live in a lower cost of living area, you are likely much wealthier than these figures suggest.
But this misses a bigger point on what it really means to be wealthy. Because being wealthy isn’t a number, it’s a lifestyle. A lifestyle where you don’t have to actively work for your income. A lifestyle where you can pursue your passions and interests. A lifestyle where you are free to do what you want.
So, while age and geographic location are important, your wants and needs will have a much bigger impact on how wealthy you actually feel. This is why I like to say:
Your net worth doesn’t determine how wealthy you are, your desires do.
Therefore, if you want to feel wealthier you can either: (1) increase your net worth or (2) decrease your desires. This is how you can have far less than someone else while still feeling like you have much more.
How to Become Financially Wealthy
No matter how you decide to go about it, the journey to wealth often begins with a shift in mindset. You will need to turn your focus away from short-term material gain and towards a more strategic, long-term approach to managing your finances. Here are a few ways you can do this:
Focus on raising your income: If there’s one idea I wish I could relay to every person about personal finance, it’s that income is the key to building wealth. Besides those successful business owners who built extreme wealth (i.e. billionaires), basically everyone else did it through their income. So, if you want to build more wealth, you should focus on raising your income over the long run. I’ve detailed some ways to do this in Ch. 3 of Just Keep Buying if you want to learn more.
Invest in a diverse set of income producing assets: Once you have raised your income, the next step is to use that extra income to acquire income producing assets and don’t stop. By purchasing income producing assets over time, you can re-build yourself as a financial asset equivalent that can provide you with income when you are unwilling or unable to work in the future. While it’s great to work hard for your money, it’s even better when your money works hard for you.
Create additional streams of income: In the process of buying income producing assets, you will create additional income streams for yourself (e.g. from dividends and interest). But I wouldn’t stop there. There are many other income streams that you should consider (i.e. royalties, products, etc.) as well. The primary benefit of having multiple income streams is that you reduce your overall financial risk. Having extra streams of income in case you lose your main one (likely your job) can be a financial lifesaver when you need it most.
Plan for the life you want: While building wealth is important, knowing what you want to do with your wealth is even more important. Because without a plan for how you want to use your wealth, you may end up feeling empty once you’ve built it. I have previously written about how this occurs for some in the Financial Independence Retire Early (FIRE) community, but it doesn’t have to be that way. By figuring out what you actually want out of life, you can take more purposeful steps toward building wealth in the way that matches your long term goals. That’s how you become wealthy
If you are interested in learning more about this subject, I recommend reading about where millionaires keep their money and why it’s not where you think.
Now that we have spent some time defining “rich” and “wealthy”, let’s highlight the key differences in the rich vs wealthy discussion to illustrate where you should focus your future efforts.
Rich vs Wealthy: What are the Differences?
Imagine two individuals, Mr. Rich and Ms. Wealthy, who represent the contrasting financial mindsets we’ve covered above.
Mr. Rich earns an impressive salary and loves to showcase his success with luxury cars, designer clothes, and extravagant vacations. He is the life of the party and appears to have it all. However, his high-income is matched by his high spending habits, leaving him with little savings or investments. Should his income suddenly disappear, Mr. Rich’s financial situation would quickly crumble, revealing the facade of his seemingly successful lifestyle.
Ms. Wealthy, on the other hand, earns a similar income to Mr. Rich but chooses to live a more modest lifestyle. She invests a significant portion of her earnings into a diverse portfolio of income producing assets that creates passive income streams, such as rental properties and dividend stocks. While she may not have the outward appearance of success, Ms. Wealthy enjoys true financial freedom, knowing that her assets and income will continue to support her lifestyle, regardless of whether she works.
The key differences between Mr. Rich and Ms. Wealthy illustrate these contrasting approaches to personal finance:
Spending vs Saving: Mr. Rich’s spending habits leave him with little financial cushion, while Ms. Wealthy’s savings and investments grow her net worth.
Active vs Passive Income: Mr. Rich relies on his salary to maintain his lifestyle, while Ms. Wealthy’s passive income streams provide her with financial stability and independence.
Appearance vs Reality: Mr. Rich focuses on the outward display of success, while Ms. Wealthy prioritizes her long-term financial well-being and freedom.
Through the example of Mr. Rich and Ms. Wealthy, we can see how the choices we make can impact our financial future.
The Bottom Line
Understanding the difference between rich vs wealthy is crucial for anyone looking to achieve long-term financial success. By recognizing that wealth is about more than just money, you can make the conscious decision to focus on not just building assets and income streams, but also on designing the life you truly desire.
Of course, this is easier said than done. Building wealth can take decades and knowing yourself can take even longer. But, if you do the work and spend the time figuring out what you want, you may just find that becoming wealthy isn’t as out of reach as you once imagined.
1. Huge Options Trading Around Regional Banks as they Report Earnings this Week.
Dave Lutz at Jones Trading Regional bank share prices have stabilised since SVB’s collapse sparked a massive mid-March slide, but traders are buying record amounts of options tied to midsized lenders that had some of the highest volatility, according to Bloomberg data. Several banks that were badly hit in the recent volatility — including Citizens Financial, Charles Schwab and KeyBank — have seen options interest hit record levels, while many more are at multiyear highs. Pricing of the contracts suggests investors expect stock swings for some banks to be up to three times normal levels, according to FT
2. Artificial Intelligence Adoption Rates Across Sectors
7. Vacation Home Demand Slowing Down…-52% from Pre-Pandemic
Vacation Home Slowdown REDFIN BLOG
Demand for vacation homes has plummeted, now 52% below pre-pandemic levels (Redfin).
What’s driving this? Higher interest rates, the lack of affordability, a decline in remote working, and the cooling rental market are all contributing…
9. Even More Young Americans Are Unfit to Serve, a New Study Finds. Here’s Why.
U.S. Marines with Charlie Company, 1st Recruit Training Battalion, stand in formation before the motivational run at Marine Corps Recruit Depot San Diego, Sept. 15, 2022. (Grace J. Kindred/U.S. Marine Corps)
A new study from the Pentagon shows that 77% of young Americans would not qualify for military service without a waiver due to being overweight, using drugs or having mental and physical health problems.
“When considering youth disqualified for one reason alone, the most prevalent disqualification rates are overweight (11%), drug and alcohol abuse (8%), and medical/physical health (7%),” the study, which examined Americans between the ages of 17 and 24, read. The study was conducted by the Pentagon’s office of personnel and readiness.
Mental health accounted for 4% of disqualifications, while aptitude, conduct or being a dependent accounted for 1% each. Most youth, 44%, were disqualified for multiple reasons.
The updated figures paint a picture of what is currently plaguing military recruiters in many of the service branches, with a shrinking pool of potential service members available to them.
Maj. Charlie Dietz, a Department of Defense spokesman, confirmed that the study shared with Military.com was accurate and said all the services are being challenged by the current recruiting environment.
“There are many factors that we are navigating through, such as the fact that youth are more disconnected and disinterested compared to previous generations,” Dietz said. “The declining veteran population and shrinking military footprint has contributed to a market that is unfamiliar with military service resulting in an overreliance of military stereotypes.”
Lawmakers have been raising the alarm over the recruiting environment throughout the year. Sen. Thom Tillis, R-N.C., the ranking member of the Senate Armed Services Committee personnel panel, said during an April 27 hearing that he was worried the widespread ineligibility of many Americans will contribute to readiness problems.
“To put it bluntly, I am worried we are now in the early days of a long-term threat to the all-volunteer force. [There is] a small and declining number of Americans who are eligible and interested in military service,” Tillis said. He added that “every single metric tracking the military recruiting environment is going in the wrong direction.”
The Council for a Strong America, a nonprofit organization made up of retired military officers, law enforcement and business leaders that advocates for better nutrition and healthy lifestyles among kids, issued a press release expressing alarm at the findings.
The group called on lawmakers in Washington to take action so that younger generations would qualify for military service.
“The retired admirals and generals of Mission: Readiness recognize that the underlying causes of obesity cannot be solved by the efforts of the military alone,” the Council for a Strong America said in a statement. “With an increase in youth being ineligible for military service, it is more important than ever for policymakers, including state and local school boards, to promote healthy eating, increased access to fresh and nutritious foods, and physical activity for children from an early age.”
Dietz told Military.com that the Army and most of the service’s reserve components are in jeopardy of missing their FY2022 recruiting goals.
Aging often comes with cognitive decline, but “SuperAgers” are showing us what is possible in our golden years.
“These are like the Betty Whites of the world,” Emily Rogalski said. She is a cognitive neuroscientist at Northwestern University’s Feinberg School of Medicine and associate director of the Mesulam Center for Cognitive Neurology and Alzheimer’s Disease.
She was part of the research team that coined the term “SuperAgers” 15 years ago. It describes people older than 80 whose memory is as good as those 20 to 30 years younger, if not better.
What researchers are learning from SuperAgers and about dementia prevention could allow us to discover new protective factors in lifestyle, genetics and resilience for common changes that arise with aging.
“It’s invigorating to know that there are good trajectories of aging,” Rogalski said. “It’s possible to live long and live well.”
What a good aging trajectory may look like
There are three major trajectories of aging’s effects on our cognition, Rogalski said.
In the pathologic trajectory, cognition deteriorates faster than expected for the age, as in the case of dementia.
A 2023 report from the Alzheimer’s Association estimates that 1 in 3 Americans older than 85 have Alzheimer’s disease, the most common form of dementia. More hopefully, research has uncovered many of the different risk factors that can be mitigated with lifestyle changes. A 2020 report from Lancet estimates that about 40 percent of dementias may be preventable.
In the normal or average trajectory, research shows, memory and cognitive abilities can begin to decline around your 30s or 40s. By the time most people are 80, on certain memory tests, they can remember about half as much as when they were 50, Rogalski said. Despite being less sharp, older people following this trajectory are still able to function — and thrive — in everyday life.
There is, however, a lot of individual variability.
This variability led to the discovery of the third trajectory: SuperAgers, who even past their 80s appeared to be at least as mentally acute in memory as those in their 50s and 60s.
It is not known what percent of the general population qualifies as SuperAgers, but they appear to be rare, Rogalski said. Even when researchers tried to screen only participants who believed they had good memory, less than 10 percent met the definition.
Over time, researchers followed those enrolled, examining their health, imaging their brains, recording their life histories and asking them to donate their brains to be studied after they die.
“The word I would use to describe this group is resilient,” Rogalski said. Many SuperAgers endured hardship, including extreme poverty, losing family at an early age or surviving Holocaust concentration camps, she said.
One SuperAger lives with his daughter and grandchildren, who do not know much about Frank Sinatra or Franklin Delano Roosevelt, Rogalski said. Instead, the SuperAger asks his grandchildren about their interests: Taylor Swift and Chance the Rapper.
“He laughs at this and finds joy in trying to keep up with what his grandkids are interested in instead of seeing that as too far of a reach or a burden,” Rogalski said. “And I think that that’s a really lovely outlook.”
What makes the brain of a SuperAger special
With age, the brain normally shrinks, especially in the cortex, which is the more evolutionarily recent part of the brain.
Not so with SuperAgers, whose brains appear more youthful in areas implicated in memory and executive abilities.
In the anterior cingulate cortex, a frontal brain region important for many cognitive functions, including attention and memory, SuperAgers had a thicker cortical layer compared with cognitively normal 80-plus-year-olds and even 50-year-olds. SuperAgers also had larger, healthier neurons in the entorhinal cortex, another brain area critical for memory, compared with both their older and 20-to-30-years-younger counterparts.
Intriguingly, SuperAgers also have an abundance of a special type of brain cell known as von Economo neurons, which are believed to be important for social affiliative behaviors. Studies suggest that von Economo neurons were four to five times denser in the anterior cingulate cortex of SuperAgers than in normal 80-year-olds, and even in individuals decades younger.
Becoming a SuperAger is probably partly because of the genetic lottery, but there are many lifestyle factors we can modify to lengthen our cognitive health span as we age.
“Stop being a dementia worrier, start being a prevention warrior,” Mitchell Clionsky said. “The active approach to this is what’s going to make the difference.”
And it is never too late to address the risk factors we can change, Emily Clionsky said. The average age of her patients who saw benefits was the mid-70s. “My oldest patient was over 100,” she said.
There is no one thing that will ensure healthy cognitive aging, but all these factors are interactive, researchers said. If we start chipping away at the dementia risks and pile on protective factors, we can reap positive effects. Here are some that may help:
· Exercise your body. Most people know the importance of getting up and moving, yet don’t always follow through. “I tell them to examine their ‘but,’” Mitchell Clionsky said. Figure out what is getting in the way of exercising and ask “How do we break it down into something you will do,” he said.
· Exercise your brain. The brain loves a challenge, so do activities that engage your noggin.
· Stay connected. Social isolation and loneliness are risk factors for dementia, while social contact is protective.
· Foster resilience. When something bad occurs, try to embrace the challenge. “What in this can be a learning moment? What in this can be a turning point?” Rogalski said.
SuperAgers cannot only help us age better but also reimagine what is possible in older age.
“I think there’s the possibility to set new expectations in aging and to revalue rather than devalue older adults,” Rogalski said.
Do you have a question about human behavior or neuroscience? Email BrainMatters@washpost.com and we may answer it in a future column.
Worldwide shipments of AppleMacs fell to just 4.1 million units in the first quarter of 2023, according toIDC figures, as the wider PC market struggles after reaching near-10-year highs during the pandemic.
Other heavy hitters in the computer hardware market like HP, Lenovo and Dell also had a rough start to the year, with figures dropping 24%, 30% and 31%, respectively, confirming that the brief boom for the PC world now looks to be far behind us.
Shutting down
While the rise of working from home had many rushing out to order new laptops and computers to load Zoom on, the Q1 shipment figure is “noticeably lower” than pre-Covid levels, with analysts speculating that it’s not only a post-pandemic drop off, but also wider economic uncertainty that’sdriving sales down. The 56.9 million PC shipments figure recorded in Q1 is the second lowest in the last 10 years and represents a 29.3% fall from the same period in 2022.
When I was born in 1922, the average life expectancyin the U.S. was 58 years old for men, and 61 years old for women.
So as a 100-year-old practicing medical doctor and neurologist,patients often ask me for tips on how tostayhealthy, happy and mentally sharp.
Good genes and a bit of luck can give you a head start, but here are some lifestyle rules I have lived by over the past century:
1. I don’t spend my days retired.
I’ve been working for more than 75 years, and was even named as the world’s oldest practicing doctor by the Guinness World Records. Sara, my wife of 65 years, also still practices psychoanalysis and psychiatry at age 89.
During the pandemic, I treated patients for five or six days a week. Then I switched to teaching medical residents for up to three days a week. (My hospital just shut down, so I’m currently doing medical legal review work while I look for another role.)
When I’m not working, I like spending time with my four children and 10 grandchildren, snowshoeing, and watching Cleveland sports.
Swimming, jogging, hiking and skiing well into my late-80s has kept me strong and healthy.
While I no longer ski and am not quite as active as I once was, I try to get in at least three miles on my treadmill at a brisk pace most days of the week. Watching Turner Classic Movies in the background helps curb some of the boredom.
Studies have found that something as simple as a 15-minute walk outside could lower your risk of premature death by almost 25%.
3. I don’t smoke.
When I was in high school in the 1930s, I told my father that I wanted to take up smoking. He said, “That’s alright with me. But why would anyone want to put anything but fresh air into his lungs when life is so short as it is?”
That immediately took the fun and excitement out of tobacco for me.
I remember attending medical meetings where doctors would, with a cigarette dangling from their mouths, tell patients to take up smoking because it would “curb your appetite and quiet your nerves.”
Today, we know that cigarette smoking leads to cancer, stroke, peripheral artery disease, coronary artery disease, and other pulmonary and cardiovascular diseases.
4. I don’t restrict myself.
Moderation allows us to live life to the fullest while also keeping us from going overboard and impacting our health in the long run.
I’ll have a martini and New York strip steak occasionally, but not every day. Sara is an excellent chef, and she’s helped me maintain a healthy and varied diet. We have salad with every meal, and enjoy greens like bok choy, broccoli and Brussels sprouts.
The real secret to longevity is that there are no secrets. But we live daily and die once, so we must make the most of the time we have.
5. I don’t let my knowledge go to waste.
Having practiced neurology for over seven decades, I’ve witnessed medicine evolve from lobotomies to the latest computerized imaging techniques.
I thoroughly enjoy teaching my medical residents and students, and I learn a great deal from them as well.
I have also been participating in upcoming documentaryabout my life. It’s been a joy to share stories from my long career with the next generation.
Dr. Howard Tucker is a neurologist from Cleveland, Ohio and was named the ”Oldest Practicing Doctor″ by Guinness World Records. He received his law degree and passed the Ohio Bar Exam in his late 60s, and served as chief of neurology of the Atlantic fleet during the Korean War. A feature documentary about Dr. Tucker is in the works. Follow him on TikTok, Instagram and Facebook.
2. Growth Outperforms Value in Quarter One…”Growth” ETFs Huge Disparity in Sector Holdings
Barrons Invesco S&P 500 Pure Growth (RPG), for example, currently has 28% in energy stocks and only 14% in tech, while iShares S&P 500 Growth (IVW) has 34% in tech and just 8% in energy. Vanguard Mega Cap Growth has more than 50% in tech and less than 1% in energy, while First Trust Large Cap Growth AlphaDEX (FTC) has 16% and 19% in the two sectors, respectively. By Evie Liu
SHANGHAI/SINGAPORE, April 10 (Reuters) – Some shares among the first batch of stocks to list under China’s registration-based initial public offering (IPO) system more than tripled in their debut on Monday despite tepidness in the broader market.
The listing of the 10 companies on the main boards in Shanghai and Shenzhen marks the full roll-out of China’s new U.S.-style IPO mechanism, designed to make public share sales more market oriented.The system has already been adopted by Shanghai’s tech-focused STAR Market, Shenzhen’s start-up board ChiNext and the Beijing Stock Exchange for smaller companies.Shenzhen CECport Technologies Co (001287.SZ), an electronic components distributor based in the southern technology hub of Shenzhen, opened up 161% on Monday, and surged by as much as 239%, after it raised 2.25 billion yuan ($327.18 million).
Under the new rules, there is no daily trading limit for the first five trading days for shares that have listed after an IPO. Previously, new stocks listed on China’s main boards could jump as much as 44% and slump no more than 36% in their debut.
However, after those five days, stocks listed on the main boards will be subject to the regular 10% daily trading limit. Dencare Chongqing Oral Care Co (001328.SZ), an oral products maker, opened up 98% and soared by as much as 214%. The other eight companies, including Shaanxi Energy Investment Co (001286.SZ) and Both Engineering Technology Co (601133.SS), rose by between 50% and 120%.Ade Chen, the general manager of asset manager Fund Investment in Guangzhou, said the stocks surged as “their valuation and debut prices are not expensive”.
CECport Technologies’s IPO was priced at 26.8 times its earnings, below the industry-wide valuation in 2021 of 35 times earnings, according to its prospectus.Dencare’s price-to-earnings ratio for the IPO was 36.8, versus a wider industry valuation of 51.6 in 2021, its prospectus said.
Both figures indicate the companies are undervalued relative to their peers. “Afterwards, investors will focus more on companies’ growth potential and fundamentals,” Chen said.Overall, China’s stock benchmark index (.CSI300), slipped roughly 0.3% on Monday, as investors focused on China’s drills around the Taiwan Strait and awaited more data to gauge the strength of China’s economic recovery after it dropped restrictive COVID-19 policies.The market-oriented IPO system reform is expected to speed up listings and corporate fundraising, as Beijing seeks to revive an economy ravaged by COVID restrictions.
“The changes brought about by the IPO reform are all-round and fundamental, centred by information disclosure,” Yi Huiman, the chairman of the China Securities Regulatory Commission (CSRC) said, according to a report from state media CCTV on Monday.
“The service function of the capital market to the real economy, especially technological innovation, has been greatly improved,” Yi said.
After the housing bubble burst in 2008, construction of new homes declined more than 50%, and residential investment pulled GDP growth down by 1% for three years.
With commercial real estate construction being roughly 75% the size of residential investment, and fewer skyscrapers and shopping malls being built, the bursting CRE bubble could be a drag on GDP growth of around 0.75% over the coming three years. This should be compared with a 2% potential growth rate for the US economy (according to the CBO).
In other words, with the commercial real estate bubble bursting, we are likely to enter three years with low growth, similar to what we saw after the housing bubble burst in 2008. Put differently, once the Fed starts cutting rates later this year, interest rates will likely stay low for several years, and QE is likely to come back in 2024.
Torsten Slok, Ph.D.Chief Economist, PartnerApollo Global Management
People are convinced that stress is leading to their demise, and it’s true that stress can contribute to life-threatening illnesses.
Compared to 100 years ago, dying of stress-related illness in our 70s or 80s is a luxury.
Welcome to Stress on the Brain. In this blog, I’ll be writing about stress and its impacts on the way we think, the way we behave, and the way we get sick. When I first meet someone and the conversation turns to my area of research, the most common response I get is, “You should study me because I’m so stressed!” This response reflects our culture’s attitudes: Stress negatively affects the way we think. Stress negatively affects our health. Stress is going to kill us.
What I tell people in response is both good and bad news. The bad news? Stress is going to kill you. The good news? It’s probably going to take a long time.
What do I mean by this? Consider that 100 years ago, the average life expectancy in the U.S. was about 54 years. Compare that to our current life expectancy of 76 years (in 2021, the most recent year for which data are available).
What was killing people so young 100 years ago?
Among the top five causes of death in 1923 were infectious diseases such as tuberculosis and influenza. Today, by contrast, four of the top five causes of death are stress-related: heart disease, cancer, chronic respiratory diseases, and stroke. (I haven’t forgotten that over 1 million Americans recently died from another infectious disease, COVID-19, but the point remains that most of the maladies that kill us today are made worse by stress.)
Why is this good news? One hundred years ago, most deaths of American adults were due to infectious diseases occurring in their 50s. Today, by contrast, we have the luxury of dying of stress in our late 70s or even older.
Much of this difference is due to the massive successes of public health.
Clean drinking water. Centralized sanitation. Improvements in maternal and infant health programs. These programs have shifted the causes of death for most Americans from acute infections to chronic diseases. Such chronic diseases are strongly impacted by lifestyle factors such as diet and stress.
Take, for example, the number-one killer of adults, heart disease. The cardiovascular system, including the heart and blood vessels, is a particularly sensitive target of stress. The system includes a pump (the heart) and a sequence of elastic tubes (blood vessels), which are always working.
One of the primary stress responses is to increase blood flow to working muscles to outrun a predator on the proverbial savannah. Just like with any mechanical system, the cardiovascular system will eventually wear out with increased use, as when under chronic stress. Modern stress rarely necessitates running from a predator, so the increased wear and tear on our cardiovascular system is for naught. It just hastens the eventual breakdown of the system.
This doesn’t sound like good news, either. But hold on. Advances in cardiovascular medicine reduce the negative impact of the modern lifestyle on our hearts and blood vessels. The negative impact that stress can have on the cardiovascular system can be counteracted with improvements in diet, exercise, and medicine, prolonging the health of the system into our eighth or ninth decade. The impact of stress is still there, but our modern mitigation techniques allow us to maintain a healthy cardiovascular system for much longer.
If all this sounds too good to be true, you’re correct. I’m glossing over a great deal, including the threat of future pandemics, increased number of deaths of despair, and the widening income gap, all of which threaten to wipe out some of the increases in life expectancy we’ve seen over the last 100 years. My message is this: You can now survive stress for longer than ever in our species’ history. Yes, stress will kill you. Until then, stay vigilant to maintain and expand on the gains that we’ve made. Future generations may have the luxury of being stressed for even longer!
