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Boomers won’t lead to bust – Cole
Tony Cole
Mercer Investment Consulting Asia Pacific business leader Tony Cole has scotched suggestions the “wall of money” flowing into the market as a result of superannuation will eventually lead to an asset/price meltdown.
While conceding that it is easy to believe Australia is following a lifecycle hypothesis and that the boom in superannuation savings had been too late for Australia’s baby-boomers, he said there was no statistical evidence to suggest there would be a sudden sell-off in assets.
He said data compiled in both the US and Australia suggested that the sell-off of assets as people got older was, in fact, very gradual.
“Assets build up, peaking with the 55-59 age cohort,” Cole said. “The important thing is that the decline is very gradual.”
He said the asset price meltdown scenario was not realistic, albeit that it sounded plausible because it was based on something that was regarded as commonsense.
AUTHOR
Mike Taylor
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