Wednesday, April 10, 2013

Demographic trends push Wall Street and Main Street

Would you lose 50% of your sales if half your customers suddenly left your market? Would your sales increase instead when new crowds start needing what you sell? This is exactly the impact that changes in the national demographic profile can have on your business and investments.
Today, Chris Puplava and Doug Short from Advisor Perspectives published a great article for Big Trends. The article focuses on the effects that changes in demographics have on financial markets. Before you read it, I would like you to consider that financial markets serve as a measure of corporate profitability levels. In other words, stock pricing shows where real corporate profit levels are, which in turn show where main street business profits should be. At the end of the day, profits are what your business is all about.

Two charts showing the relationship between changes in population and the stock markets
Launch Article
PS. I know that markets may gyrate on a daily basis due to changes in investor emotion and not fundamentals. Nonetheless, fundamental profit performance drives the long term, which is what this article focuses on.

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