3 Places NOT to Invest as World Population Peaks, Falls

Rudy Martin

As a professional trend-watcher, I’m always looking for long-term shifts and how to profit from them as they develop. The world is changing faster and faster. I want my readers to know what lies ahead so they will be prepared at each stage along the way.

The trend I’m watching today is leading us toward a truly historic moment. While still several decades away, this event will change the world … and as investors, we can be a part of it now.

I’m not exaggerating at all. This is big — but few people think about it.

Based on current trends, somewhere around the year 2050, the total human population will stop growing. Then it will begin to shrink. Every year will end with fewer people than the last.

The decline of humanity won’t be a result of war, natural catastrophe or mass migration to another planet. It will simply be the culmination of a centuries-long demographic trend.

Population trends unfold slowly, but they have major investment implications. This is why we often discuss them in Uncommon Wisdom Daily. For instance, see my July 17 Guess Which Generation Will Drive Stocks Higher and the Aug. 8 Afternoon Edition by our publisher Brad Hoppmann, Can You Afford To Live To 100?

Brad’s column drew enormous reader response. Many of you anticipate reaching the century mark.

What kind of world will you see when you turn 100?

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Well, if you are 63 years old now, your 100th birthday will occur in the year 2050. Population experts believe 2050 will mark the planet’s population peak. From there, the number of living humans will stabilize or even turn lower.

Even if you are currently in your 70s, the pace of medical advances gives you a reasonable chance of seeing this signature point of human history.

Look at this chart from the United Nations. It includes three different world population scenarios.

The top series (purple triangles) assumes "constant fertility." This simply means the average woman will continue to give birth at the same rate as previous generations.

Reputable demographers think this is very unlikely.

Estimated World Population 1950-2100

Source: Population Division of the

Dept. of Economics & Social Affairs of the

United Nations Secretariat (2013)

The red line projects "linear" population growth. This is also unlikely because of a downward trend in female fertility rates virtually across the globe.

Even the blue "median" projection shows population growth slowing perceptibly around mid-century.

I think the lower green line will be closest to the mark. It shows world population peaking at around 9 billion in 2050 and falling back to the 6 billion area by the year 2100.

Some experts think the earth’s population will top out even sooner. Robert Bain, a Ph.D. and professor emeritus in sociology at Southern Illinois University, thinks population will peak around the year 2030. He bases this on mathematical regression analysis of changing birth and death rates.

Bottom line: The future won’t look like those science fiction movies showing a planetary megalopolis with people jammed into mile-high buildings. We’ll have plenty of room for everyone.

Investing as World Population Falls

By 2050, I plan to be in a comfortable retirement, with a nest egg to keep me secure for my remaining days. And no matter how old you are, the turning point is many years away.

However, the trend will not develop at the same rate everywhere. Some areas of the globe are already losing population now. Other places could continue growing well after 2050.

How will you invest in this kind of world? I know the population peak will bring opportunities. Identifying them so far in advance is tricky.

I think three industries that will have an especially rough time in a shrinking world.

  • REAL ESTATE, including construction equipment, will lose value when fewer people need to reside on the property or use its structures.
  • NATURAL RESOURCES demand will be much lower in the reduced population.
  • AGRICULTURE, including machinery and food processors, should lose much of its growth potential with fewer mouths to feed.

While these sectors could still perform well, they will eventually face a long-term headwind. Declining population will bring many changes. We should at least start thinking about them.

The Most Important Lesson …

Trends are important and useful, but they can still change. Never assume any trend will go on forever.

Human population growth may be the world’s most dominant and long-lasting trend. I see strong evidence it may end in our own lifetimes — but I can’t foresee every possibility. Something could always change the outlook.

As investors, we should constantly re-evaluate the status of every trend we follow. The goal is to Ride the Right Trend at the Right Time.

  • Back in the late 1980s, some investors thought an endless Japanese economic boom would propel the Nikkei index to infinity.
  • Ten years later, many assumed the bull market in dot-com stocks would never end.
  • Early in this century, home values were destined to go nowhere but up.

All these trends ended, to the surprise of millions. The population growth trend will end, too.

Like every major trend, we should watch this one closely and thoroughly evaluate the impact. Fortunately, we have some time.

You can bet I’ll be watching. "Trend" is my middle name—or, at least the middle name of my Global Trend Trader service.

I’ve told you three sectors to avoid in the year 2050. In only 37 years, we will know if I’m right!

Sincerely,

Rudy

P.S. One undeniable trend unfolding right now is the collapse in one of the world’s most-powerful currencies. My friend Tony Sagami has all the details, plus the name and ticker of ETF that could enjoy a 20% pop because of it, in his newest video report. Click here to get instant access!

Your thoughts on “3 Places NOT to Invest as World Population Peaks, Falls”

  1. I have lived in Japan for over 30 years and can tell you that new home prices have not fallen in line with the falling population.

    Population didnt decrease until 2012. Up to 2012 population increased.
    Anyway, Im glad to see if this trend actually holds true. Logically for those who want children 1-2 is already enough. I just tink about myself and even that i come from big family (6 children (Father has been married twice, so TFR is 3)) it is hard to imagine myself having so many children. Actually, I dont want at all:) It would be different if my brothers would not have also children.

    ps. english is not my native language so my grammar probably isnt that good:)

  2. Hello Rudy,

    I actually disagree with you, but think it is great you mention this topic. I do not think we can adequately count the world’s present population and I think it is more than estimated, by a good billion already. I certainly hope you are right about the falling population not being due to war, but as economies struggle to survive people may well do likewise: and as we see currently in the ME this can get violent and result in many deaths.

    Also, I do not necessarily see house and property prices falling due to the falling population. As the population grows, we normally see ever rising prices due to inflation and ever increasing volumes of money being loaned into existence by more and more people; and the increasing quality of homes being built.

    I have lived in Japan for over 30 years and can tell you that new home prices have not fallen in line with the falling population. New home prices have remained fairly constant for 25 years at around 300,000 – 400,000 yen for a new three-room plus living/dining and kitchen city apartment and correspondingly cheaper in the suburbs and country. Of course, existing homes lose their value, but the new ones tend to hold their value on an even plateau, at least they have for 1/4 of a century here. I guess it’s because everything gets old; the universal law of entropy. So new places are perhaps fewer because there are fewer people to build them; and because they are always in demand, and built by the declining population in corresponding numbers the price remains about the same.

    Kind regards,

    Chris

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