History has begun to repeat itself. Lower birth rates and aging populations will lead to another economic crisis

As 2024 approaches, most people are bracing for the next recession. But the common belief is that we can recover from the next recession just like we did in the 2008 recession. The truth is that we've never fully recovered from the 2008 recession.<br><br>The first economic crisis in 2008 was largely due to a housing bubble. This is what led to the massive government and consumer debt that we see today. The problem with this is that government debt is tied to interest rates. Low interest rates tend to lead to higher inflation, which are associated with higher birth rates. However, high interest rates are associated with lower inflation and lower birth rates. Lower birth rates lead to a shrinking labor force, which has already occurred in many European countries. This is what led to high interest rates, which caused a housing crisis, and led to the 2008 recession.<br><br>If we look at the history of interest rates and inflation, it becomes clear that the cause of high interest rates and low inflation come from low birth rates. It works like this:<br><br>Lower Birth Rates > Older Population > Lower Inflation > Higher Interest Rates > Lower Birth Rates > Older Population<br><br>So once this pattern occurs, it is designed to repeat itself. It is also important to note that once this pattern occurs, there is no way of recovering. The most common explanation for low birth rates is a lack of affordable housing, and the commonly proposed solutions are to encourage immigration, build more homes, and make housing affordable. The problem with this is that these solutions will inevitably lead to hyperinflation.<br><br>History has begun to repeat itself. Lower birth rates and aging populations will lead to another economic crisis, and there will be no way of recovering.