Here's Why Old People Hurt The Stock Market

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		Tech Entertainment Wall Street Markets Strategy Sports Lifestyle Politics Europe Video Latest Tuesday, August 23, 2011 Here's Why Old People Hurt The Stock Market The American baby boomer generation could hurt the faltering U.S. economic recovery according to a report by the Federal Reserve Bank of San Francisco (FRBSF). Historical data indicates a strong relationship between age distribution of the U.S. population and stock market performance. Which makes sense, given that a rule of thumb for investors suggests that their asset allocation should mirror their age. Now concerns are that baby boomers looking to finance their retirement could sell off risky equities just as the stock market is starting to recover from the financial crisis. The chart via FRBSF compares P/E ratio (price/earnings) with the M/O ratio (middle-age cohort to old-age cohort). It shows a correspondence between the two and signals that baby boomers could be a factor in the slowdown of stock markets over the next 20 years. Read » Also On Money Game Today: ANALYST: Bank Of America's Bizarre Personal Attack On Henry Blodget Suggests "Something Is Seriously Amiss" ROUBINI: Gold Is In A Hyperbolic Bubble TODAY'S MONEY TIP: Stock Buybacks Are Not A Sign You Should Invest The Famous Baltic Dry Index Climbs 16% In One Week Advertisement CHART OF THE DAY: The Bank Of America Death Spiral CHART OF THE DAY: The Great Stocks Vs. Gold Round Trip CHART OF THE DAY: What Happens To Stocks If Profits Don't Collapse? Share this: Facebook Twitter Digg Reddit StumbleUpon LinkedIn The email address for your subscription is: dwyld.kwu.wyldside@blogger.com Change Your Email Address | Unsubscribe | Subscribe | Subscribe to the Money Game RSS Feed Business Insider. 257 Park Avenue South, New York, NY 10010 Terms of Service | Privacy Policy

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