{"id":44229,"date":"2013-11-15T12:52:50","date_gmt":"2013-11-15T17:52:50","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/?p=44229"},"modified":"2013-11-15T12:52:50","modified_gmt":"2013-11-15T17:52:50","slug":"investing-in-generation-y-and-the-next-great-baby-boom","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2013\/11\/15\/investing-in-generation-y-and-the-next-great-baby-boom\/","title":{"rendered":"Investing in Generation Y and the Next Great Baby Boom"},"content":{"rendered":"

By The Sizemore Letter<\/u><\/a><\/p>\n

\"\"<\/a><\/p>\n

No respect.<\/p>\n<\/div>\n

Generation Y, like Rodney Dangerfield, has a problem: they get no respect.<\/p>\n

I\u2019m joking, of course, but at this stage of their lives Gen Y really isn\u2019t taken as seriously as they would like to be.\u00a0 It is to be expected; they\u2019re young.<\/p>\n

The front end of Generation Y was born in the early 1980s, but the biggest cohort was born in the \u201cmini baby boom\u201d between 1989 and 1991.\u00a0 This puts them in their early 20s today, in their last years of college or their first years on the job.<\/p>\n

There are a few things you should know about Generation Y.\u00a0 Growing up in such a large generation, they are competitive.\u00a0 I grew up in Generation X, a much smaller generation.\u00a0 For me and my peers, everything from making the little league baseball team to getting accepted to college was comparatively easy; there were relatively few of us competing for each slot.\u00a0 Not so for Generation Y.\u00a0 This is the generation that had to start studying for the SAT at age 11 and spend their summers building homes in Africa in order to be considered<\/i> for admission to a decent university. Having grown up in comparative abundance, they may be a little spoiled.\u00a0 But they\u2019re certainly not slackers.<\/p>\n

Your last experience with a member of Generation Y may have been having your order taken at Starbucks.\u00a0 But as hard as it may be to believe today, that barista is going to be a mom or dad in a few short years.\u00a0 And in the process, they are going to create a massive boom in everything from baby formula to starter homes.<\/p>\n

Let\u2019s take a look at the numbers here.\u00a0 Depending on where you draw the precise lines, Generation Y is either a little bigger or a little smaller than the Baby Boomers.\u00a0 But we\u2019re talking about approximately 80 million people.<\/strong><\/p>\n

\"Mother-Wave\"<\/a><\/p>\n

The average age of first childbirth is about 25-26 years today for American women, though that number continues to rise a little each year.\u00a0 The higher educated a woman is, the longer she is likely to postpone motherhood, and Gen Y women are the highest-educated generation of women in U.S. history.\u00a0 A bad economy with high unemployment among the young has probably added another year or two to the average as well.<\/p>\n

But biological clocks don\u2019t stop ticking, and the largest cohort of Gen Y women is quickly approaching their peak family formation years.\u00a0 \u00a0I expect the number of live births to increase every year from now through the early 2020s.\u00a0 And if Gen Y has the standard two kids per family, you\u2019re talking about 80 babies being born in the years ahead.\u00a0<\/strong><\/p>\n

How do you invest in this macro trend?\u00a0 Take your pick.\u00a0 You could invest in the makers of infant formula, such as Abbott Labs<\/strong> (ABT<\/a>) or Mead Johnson Nutrition<\/strong> (MJN<\/a>).\u00a0 You could buy a portfolio of rental houses in the neighborhoods where young families are moving\u2026or for that matter, you could selectively invest in homebuilder stocks.\u00a0 You could start a business that caters to new parents\u2026or grandparents! Any or all of these are perfectly viable ways to play this trend.<\/p>\n

But if you want to be a successful investor in the U.S. equity markets over the next two decades, a general rule of thumb applies: figure out what Gen Y will be buying in the years ahead and invest in it before the crowd catches on. \u00a0And give Gen Y a little respect. \u00a0Their consumer preferences will shape the U.S. economy for the next generation.<\/p>\n

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This article first appeared on Sizemore Insights as Investing in Generation Y and the Next Great Baby Boom<\/a><\/p>\n

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