The Fourth Turning is Here | Neil Howe Explains What Comes Next

And it's always the same three things, by the way. It's it's basically tax, borrow, inflate.

Gen Xers felt that the only way they could survive is by taking their life rafts and and and and sailing in different directions because the whole thing was going to sink. Millennials are roping all of their lifeboats together because they realize if the entire S&P goes down, someone's got to save them.

History suggests that when society feels that it's entering its more collective mood of not wanting to take individual risk visav others, it's more likely to take collective risks.

Apple or Nvidia or Microsoft go down by 30% or 40%. You know that chairman Powell is going to have an emergency press conference. What people don't understand is that late in a crisis, inflation is always part of it because inflation is not a problem in that case. It is a solution.

Conflict is the incubator of community. It happens every time.

Today on Rabbit Hole, I'm joined by Neil How, author of Generations: The Fourth Turning. The Fourth Turning is here. You can find his work at Demography Unplugged. That's where I read it. We're not going to go deep into what generational theory is or the fourth turning. We're going to talk about the now being the frog in the boiling water of the current crisis. Neil, thanks for joining us. Maybe just a a very quick where are we in your cycle and how does it feel in terms of how you would expect it to have gone when you started this process 20 years ago?

I have to say in all honesty uh this has played out pretty much as we expected. Um, and uh I you know I I probably should say something else is completely not what we expected. Um, I I will say that um uh and again I'm just speaking honestly from when Bill and I first started writing about this actually in 1991. That was in our book Generations uh where we first talked about uh uh you know American history and and and by extension uh much of Western history being cyclical, modern history being cyclical. We we talked about a crisis of the 2020s and you know it's in that book uh and and we fortold something that would be the way this this generational cycle plays out would lead to that. Now at that time we often thought about a something peaking you know in in the year 2020 or in the early 2020s right and I would say the one the one kind of difference is is that uh uh due to the uh uh lengthening of generations the the slowing of the timing of generations that I would say we we're pushing uh that the cycle is dilating slightly and this has happened over time this actually happened over the centuries the cycle cycle used to be a bit longer, you know, back in the 17th and 18th century. It shortened a bit at the end of the 19th and early 20th centuries. And I think it's lengthening a bit again. And I think the reason for that is that um uh the the timing the the governor of the length of the cycle is the generational phase of life. Uh that is to say the time it takes from a person to be born to fully come of age as an adult and then by extension from being an adult uh fully coming into your roles in midlife which is sort of the leadership phase of life and then you know the elder phase of life is when you're presiding over America's you know society's uh most highest institutions at the highest level and I think you can I think it's fair to say that u uh the time it takes for someone to become of an adult in America has has lengthened, you know, over the last 30 years. Um, uh, the the age at which someone becomes gets married, becomes a parent, has a permanent career. I mean, all of these things are are 5 to seven years later than they used to be. The age of which people are actually uh uh being elected for political leadership has gone up about four or five years. And God knows the age of which people are presidents. I mean, you know, it's off the charts, right? So, you see what I mean? There's a dilation in in phases of life. And that is actually the timing of the cycle. And I talked to a lot of people who say that technology speeds speeds things up. You know, it should be speeding the generational cycle up. Uh well, we can talk about that if you want, Dave. Uh uh but I think the cycle is actually slowed down. I think the experience of young adults today is more like the no growth economic experience of living in the uh 17th and 18th century than it is to live in the early 20th century when uh uh uh economic mobility and uh uh possible full adult phases of life were available much earlier in life than they are today. I think for a lot of young adults it's just everything is on hold for you guys. You know what I mean?

I I think that that feels very true and this is exactly the part of this I wanted to get into which was this the the living in its roles issue because it's one that feels very relevant to me. I'm uh you know I think your definition of of Gen X is 65 to 80 roughly in there which is a little bit shorter than some of the other generations that are alive right now. It it's actually we define ex 1961 to 1981. So, okay, those those early uh 1960s babies uh they were about uh you know, they they were still preschool during Woodstock, you know what I mean? Right. Right. They're not boomers. They had the throwaway they had the throwaway uh upbringing of a Gen Xer. Right. Right. And they were the they were the ones who started coming of age in the early 80s with the Down with Disco and the New Wave and and you know, Michael J. Fox and all and that's that's right down the middle for me and sort of my my colleagues all sort of fit into that mix and one thing that that has been a topic of conversation amongst sort of peers, mentors and mentees for the last five or six years was this this feeling that Gen X in particular has sort of not never been educated about how to move into the next phase, how to become elders, right? I mean in your parliament we were sort of a nomad generation latch key kids and as part of that it feels like we've missed most of the opportunities to learn what our later roles are supposed to be or at least historically have been useful to society. Do you have some thoughts about sort of that shift from midlife to eldership and the gap between what we see in the baby boomer generation which has seem to be very reluctant to let go of a lot of leadership and the Gen X community which which honestly feels largely listless with the exception of some obviously very high-profile very successful Gen Xers in government and industry. Do you have any thoughts about that role transition that we're seeing in the now?

Well, I think Gen X is really an interesting phenomenon, right? And and it belongs to a type of generation we call nomad generations. And these are typically raised at a time when um no one really cares much about kids, right? I mean, I was talking earlier about throwaway generations. This is the generation that grew up with all the childish devil horror movies and you know, everything about that generation was uh bad and contemptable. I mean, let's face it, as soon as they came along. Uh, and I think the the I often say that the the Gen X attitude toward themselves is a little bit like the the child of divorce writ large. I mean, America was doing great until we came along, you know. So, we must be at fault, you know, there must just I certainly felt that bad Seed, you know, you remember that movie Bad Seed. Anyway, uh, but but again, uh, and I do think that when Gen Xers came of age, the whole attitude was most of us were doomed. uh and and only a few of us will be lucky enough to survive which has actually led this generation to be very much of a contrarian generation, individualistic generation. I'm only getting aheaded by being different from my peers. So, they've resisted big brands. They've resisted going along with the crowd. They've been very good um contrarian investors. You know, they're really good on those those, you know, those uh short funds. You know what I mean? Y I'm gonna, you know, I'm gonna go negative on this or that. lot of doomers. The millennials are completely different. So millennials, it's all we got all band together. Um uh and they're all investing in target date funds. But that but that boat 500, but here's the difference. Gen Xers felt that the only way they could survive is by taking their life rafts and and and and sailing in different directions cuz the whole thing was going to sink. Millennials are roping all of their lifeboats together because they realize if the entire S&P goes down, someone's got to save them. You know what I mean? It's actually pretty clever and I think they're right actually. Uh but but it's a very different collective um uh self-identification. And I and I do think for Gen X, the whole problem of maturing is how do you get a mature role as a um a leader of institutions as a cornerstone of the community when you've grown up thinking that you were past the end of history and not not only did no one care about you, but the world would be better off if you just didn't take part. And I know a lot of exerts and this is one of the reasons why they had a this very libertarian and and very often overtly sort of you know counter hippie or counter counterculture image. I I raised Michael J. Fox earlier as an example of this generation in the early 80s. But this generation has always leaned more Republican all of their life in every election than the electorate as a whole. And now this generation is the number one MAGA generation. They voted more for Trump than any other generation, right? So, they deem themselves to be beyond democracy, beyond all this idealistic crap. We're in this world of survival, and maybe from time to time, we need a strong man to come in, cut corners, and kick heads, right? But I do think there's also this issue of so who's going to be who's going to take care of uh you know the the the little platoon my family my community and many of this generation uh are raising their own kids the opposite of how they were raised. Right? This is the uh this is raised with Judy Bloom. you know, the silent generation, you know, just expose your kids to everything and leave them at home and let them find out everything for themselves. That way, they'll be better inoculated for how horrible the world really is. And Gen Xers are raising their kids and have raised their kids. You know, many of them are getting older now. Many of them are obviously in their 20s and so on, getting older, but they are raising their kids extremely protectively. And we have seen this pattern generationally time and time again. The last generation we saw that was like Gen X was the lost generation, right, of Escott Fitzgerald and George Patton and Dwight Eisenhower and, you know, they were the ones who were the, you know, the doughboys who got mowed down during World War I, a war that everyone hated and thought was pointless, right? And they came home to uh no no victory tape parades for them very much. They came home to the Spanish flu and u and and America thinking that our involvement in Europe or anything was and then eventually into the great depression. Yeah. Yeah. And eventually their their their peak years were in the great depression. And they too though as parents I mean you can look uh look at Harry Truman, look at uh look at Hemingway in his letters to his daughter. Look at Fitzgerald's letters to his daughter. Uh they were incredibly protective. Right. Um, and and they were also very much a generation of pragmatists, you know what I mean? Anti- idealists. Just deal with the situation, right? What's right in front of you, which which it feels very true. Again, as a as a midlife Gen Xer with my kids in their 20s. I mean, I'm pretty much the stereotype you're talking about. Um, that feels very real. And I look around sort of the community of folks that I know broadly. That feels very real. But this next transition, right? We've raised our kids. We've gotten them out there. Whether we overprotect them or not, whether they're successful or not, whatever we did, we all had our path because we're all humans. Now, we're sitting here, you know, maybe we're in a business, maybe we're in politics, but more likely we're sort of late career, you know, 50s60s folks who are now increasingly being looked to to be elders for the millennials and the zoomers coming up behind us to to impart wisdom, to do all these things. we expect elders to do. But to your point, as nomads, we haven't necessarily leaned into those kinds of responsibilities throughout our lives. How does this play out? I mean, if you look back at the lost generation, what did their eldership look like? And can we learn anything about sort of graduating into eldership as a Gen Xer from them?

Well, what they did was they were thrown into a world which seemed to be falling to pieces, right? I mean this is a generation that that reached reached midlife at a time of both the great depression when nothing seemed to work economically you know unemployment double digits GDP cratering then and also huge transitions enormous volatility in the markets I mean you know the the America came back in 1935 36 and then went to this huge retigenous slide again in 37 a 50% decline in the stock market it wasn't just downs it was up and downs it is a roller coaster, right? Um and enormous political transition. Of course, this was one of the great realigning series of elections, 1932, 34 and 36, which feels pretty pretty real now. Yeah. Another series of realigning elections. In fact, I will tell you that many people are calling uh you know, 2016 through 2024 to be America's you know, seventh great realigning election period. We've had them in every crisis and every awakening on quue you know since since you know the 1790s. So this is right on schedule, right? I mean the big transition this time is u you know working class kind of moving Republican and and and educating professional moving to the Democrats, right? So, but it's completely changing politics and I think the enormous pragmatism of the honeybger style of the Trump presidency. Just rip everything apart, try everything, smash things against the wall, see what works. Right? This is very This is kind of the soul of pragmatism. Uh, forget about what you've learned. They don't teach you how to govern the Trump presidency in graduate school. You know what I mean? It's not there at the at at at Wharton, you know, and and so this is the style. And and when I look at those uh those uh signal chats, you know what I mean, with JD Vance, Pete Hegset, you know, Europeans, they're just pathetic, you know what I mean? And it's all like in caps pathetic. This is Gen X as America's leaders. Get used to it. Okay. I mean, get used that unfortunately no longer the respectable man with the respectable language, the multi-elabic phrases, right? No. No. This is shoot from the hip. Say exactly what you think and if it doesn't work, I'll try something else. Yeah.

I see that on the national stage, right? those like that's been very easy to see. Part of the reason I loved the fourth earning is here so much is because it did put the pin in a lot of these things in a way that just sort of made you go aha. Um but in that context you also talk about sort of the scenarios that we have for how we get out of this over the next four to 10 years or whatever it is and you sort of effectively point to three outcomes off the top of my head. one is we have effectively a form of civil war whether it's guns in the streets or just even more you know disruption than we've had already or we have some sort of external crisis which you know maybe we're in the middle of that one it's always hard to know why you're in the middle of it or we end up with sort of an internal realigning that sort of I think you would call that a second regeneracy where we sort of rebuild some institutions we allow a few things to die and work from the ashes but we're not done yet it's a little bit more decisive than that okay uh the the next regeneracy whether we have two regeneracies, three regeneracies ultimately leads to a consolidation when the country feels that its very fate is at stake, right? When the dissolution of everything we stand for uh seems to be in the balance, right? Whether or not we survive or or fall either to a foreign invasion or dissolution from within, right? That's the consolidation that lays we haven't reached that yet, right? But I'm saying I'm saying this is still there in the near future, right? And then ultimately that leads to the crisis, right? And then after the crisis, you finally have the uh the the you know the conclusion uh when all the treaties are signed and you know all the institutions are topped up. It's it's basically we had in 1946 when suddenly not just you know the UN but but the IMF and Bretton Woods and the World Bank and rebuild everything and NATO suddenly you had and at that time all the cement which was very fluid when all these huge institutes were being constructed suddenly begins to harden you know what I mean and then you have you know two and a half decades of the American high which was this period of incredible institutional stability albeit a time when the world was rapidly changing, but America felt master of its fate, right? Individualism was not highly prized, but Americans felt like they were more the than the sum of their parts, right? They felt individually perhaps not terribly powerful, but that was okay because collectively they stroed the world, you know what I mean? And that that was from from Truman, you know, through Eisenhower, through Kennedy, uh then got kind of going in things began to fall apart in LBJ, right? That's when he entered the new that's when he entered the awakening. But but that's how America felt which is very characteristic of a first turning and at that point Gen X is the senior leaders you know what I mean or at that time the lost generation was the senior leadership uh uh generation and of course that increasingly you had this uh pushy aggressive you know very ambitious GI generation who who wanted to do much bolder things uh with with with government right is it is it the nomads is the Gen Xers or the last generation that ultimately sort of rebuild, instantiate and give authority to the new institutions or does that happen behind us? Is that the millennials that show up as the heroes to rebuild?

The millennials behind you by the time they reach senior leadership positions, they take all the stuff that you've built, right, rendered secure, rendered, you know, the the the revolution of common sense has finally, you know, run its full course. And then you suddenly have these new secure but still young institutions that nonetheless you as leaders don't want to be too risky with them. You understand what risk is all about. I always say generation X knows about risk better than any other generation. They were raised they were suckled on risk right all are terrified at risk. Right? I mean that's the deal right? Uh but but but Dwight Eisenhower was a very riskaverse president and I think very much in the style of his generation, you know, he wanted to make sure the Soviets were in their place. He wanted to make but he did not want to do anything adventurous. He did not want to start new wars. He wanted right um and uh and and and it worked. And over that period, America suddenly became more prosperous and you know that we suddenly suddenly gathered gathered momentum. But the next generation, the GI generation, you know, as as Jack Kennedy liked to say, they wanted to take longer strides, right? Uh and they wanted to they wanted a great society as as LBJ say. th those those dreams of FDR had been put on hold by these last generation presidents who let's face it u many of them were Republican you know was like Dwight Eisenhower yeah we had we had to come to terms with with social security but that's it don't want to do you know what I mean um but no this this new generation wanted new things right it wanted a great society it thought we could have guns and butter we could fight wars in Southeast Asia and to bring the final fruition of what FDR started, right? Another new deal and and and we could go to the moon and you know what I mean? We we could do lots of stuff and maybe at the same time let kids explore their inner world. Oh yeah, that'll turn out just great. So at Woodstock, you had helicopters fing bottled water and fing to these kids. I mean, who knows? They may know something we don't know. You know what I mean, right? There was no sense of caution in that generation when it came to big collective risk. Individually, they were very riskaverse. I think like millennials. And if if history does have one lesson, it's that as we grow individually more riskaverse, we often grow collectively more likely to take risks. And that's something very interesting to think about in the context of the fourth turning. Um, individually we become much more a society that wants sh to be sheltered. You know what I mean? We want we want safety nets. We want someone to look after us. Everyone talks about the Fed put, the Trump put on the market. You know, believe me, if we had another thing like if we had another crash um uh like the GFC, I mean, we'd have Feds just start replacing everyone's paycheck just like we did in CO. I, you know, I think actually the the the circuit breaker now for for misery is uh is set at a very light point. You know what I mean? And and I do think despite what Trump says about and I think he's pretty smart to say it, uh you know, I don't mind having a recession early in my presidency. I'll be like Ronald Reagan, you know, beating America by the time it ends. That's just smart. I mean, that's what he should be saying, right? Um but nonetheless I think we have I think I think that the the collective backs stop is big for us and I'm what I'm saying is that history suggests that when society feels that it's entering its more collective mood of not wanting to take individual risk visa others it's more likely to take collective risks right our entire society risking going this way or that you know to make sure that we become something new something different something safer as a group. Um, and I see that I see that as a historical pattern.

By the way, I did where does individual like financial risk-taking fit into that? Because certainly one of the stories of the last five or six years has been the r the rise of sort of yolo financial nihilism certainly in the US? I I don't want to speak elsewhere, but whether it's, you know, the endemic nature of sports betting, poly market, um, massive amounts of leverage, crypto, none of that feels like anybody being riskaverse to me. that feels like a lot of risk-taking behavior at the individual level. And I don't think it's true that that's just entirely folks under the age of 30. I think that I think that's a pretty broad trend that we've seen in investment markets and entertainment markets. How does that line up with that idea of the sort of increasing conservativism?

I actually don't think it's not just, you know, it's I think it it is people over 30 is my my point. I think Gen Xers are setting the tone for that. But I also think there's a feeling among a lot of people, you know, particularly by the time we got to the late teens, you know, we got five or six years out of the out of the out of the great depress great recession that that, you know, everyone's playing with house money. Um, you know, the stock market is up so much. Uh, this is just paper money. I can play with it. Uh, I do see two big trends among millennials. One is we talked about it earlier uh target date funds and passive investing. That is not that is not taking risks that is making a very calculated judgment. I'm going to invest in the entire market and that serves two purposes. First of all this is very important among millennials. I'm not going to envy my buddies because they're going to be investing the same thing I am. So you know we either all go down together which is okay. It's community investing. Yeah. Well, it is kind of community investing and this is why everyone's worrying and I'm one of them. I've written about this subject a lot. I worry a lot about passive investing as basically disabling u uh the role of active investing and actually ser you know serving what financial markets is supposed to do uh is actually provide a good estimate of the value of of of uh of of firms right um and uh and I think to some extent in the last couple of years we've even seen the entire world begin to invest in America because of this whole passive craze that we've gone on yeah and my whole career's been there so I agree with you we've had all sorts of unintended consequences from passive investing. Um, but I I do believe perversely it's the fact that everyone sees more strength in all duplicating each other. I mean that's the weird thing about having uh you know government as a backs stop. I mean you know that if you know Apple or Nvidia or Microsoft go down by 30% or 40%. you know that uh you know chairman Powell is going to have an emergency press conference and he's going to talk about the three five things we're going to do right now to correct this. But if you have some little if you're investing in some little company on the Russell 2000, he's not even going to notice you. Do you see what I mean? It's like it's like federal emergency insurance. You know, if you don't want just your house, if your house has to burn down, I'm sorry, but you want everyone all your neighbors houses to burn down cuz then you're going to get aid, right?

Well, but this gets to an interesting question of the difference between sort of social moors, uh, individual tendencies, you know, community collectivism versus, you know, liberalism versus conservativism. Like, that's one set of issues. But then there's also just raw economics which are always inter intertwined. you know, the rise of passive investing, the increasing role of government and finance, etc. Um, the increasing use of private markets versus publicly regulated markets, do those naturally follow a pattern along with everything else? I mean, do you do you see the the first turning, the next awakening foundationally changing sort of American democratic market capitalism, or do you think that those are sort of too foundational to the way we do things now? And what we're really talking about is a lot of the execonomic stuff, you know, policy for this tax or that tax, that kind of stuff.

Well, I do think that that as as the crisis intensifies, you know, it doesn't matter whether it's internal or external. Doesn't really matter what it is that what you le what you go to is toward public mobilization of resources against whatever dangers out there. And at that point um uh then markets start getting harnessed to what society needs to do. Uh and what do you need to do when you arise public? I'll tell you there are three things uh there and and it's always the same three things by the way. It's it's basically tax, borrow, inflate. And and you know you you tax where you can but of course you can't suddenly tax everyone for everything. you get people to invest in the future. You know, that's the bond drives uh and then you inflate. And what people don't understand is that late in a crisis, inflation is always part of it because inflation is not a problem in that case. It is a solution. It's a burden sharing device. You take from all the creditors who have nominally, you know, denominated assets. You basically say, you know, we're asking a lot of other people who don't have your wealth. This is what you're going to do. you know, we're going to take that real wealth from you and we're going to do it through inflation. And that was done through World War II in the late 40s. And and if you look at why not just America but but most of the western world became more equal, you know, during the a little bit during the 30s more rapidly during the 40s and and dur then the the first turning the American eye the 50s and 60s a lot of it was a combination of of inflation uh crisis you know actually taking away people's wealth obviously there's also just destruction you know and and and and rapid uh uh economic restructuring in industries um and and also financial repression. And here I want to get to something that should be on the minds of all investors, right? Financial repression is not just enough to uh to say, "Yeah, we're going to have an inflation rate of of, you know, 12%, even though your bond is only getting 4.5%." Which was the case during World War II, but we're going to force you not to sell that bond. In fact, we're going to require you to buy more of them if you're a bank or if you're various financial institutions. This is called financial repression. And and this we are going to have we always do. Uh it's what they did during the Civil War. Samuel Chase actually distributed the greenbacks to pay for the war. He set up all these new federal banks and they were required to take green backs and they're required to take US debt to issue the green backs. I mean, in other words, this is what happens. everything starts to be harnessed around these, you know, the the the community's desire to survive and overcome whatever adversity it faces. And a lot of the stuff you describe, uh, you know, uh, you know, betting on AMC and all the crypto stuff and everything that just that falls by the wayside. I mean obviously uh the this the overall stock indices revalue um and and in his own weird way I you could say this is um u the this this is part of uh Hegel's cunning of history. Uh Donald Trump is getting us used to that. You know what I mean? He's getting used to uh extraordinary volatility in markets. Uh, and he's getting used to, I don't know, even the craziest stuff when he says, "Oh, we'll only have two dolls for Christmas." You know, there's this, you know, Donnie two doll. You know, there he is, you know, getting us used to it, coming down, right? But but but but I'm thinking, you know, um I'll say one thing about Trump uh that is probably accurate uh what he accurately foresees and and is is that Trump, however, um uh bluntedged and chaotic his his instruments for affecting it. Uh he's often very preient at seeing where the country is going. Right? I thought in 2016 he was one of the few people who foresaw that globalization was going to reverse, right? And indeed it was uh and that uh and that America uh culturally would be shifting direction, you know, in a more conservative direction. And I think we've we've seen that actually in the last few years. We certainly see among, you know, younger people now coming of age. So I see a lot of these things he saw I and I I think by and large the whole idea that America will be uh you know a number of years from now who knows how long it's going to take as a nation that's going to have to have much higher net exports and a much higher net savings rate. However wrenching that transition is we may be facing much higher prices for certain goods. We may have certain goods just not there on the shelves. This this whole idea of reindustrializing America, at least part of America, you know, parts of some industries re-industrializ is going to be enormous, painful, difficult process. It's not going to be just a few months. It's not even a few years. It'll take maybe a decade. It'll go way on into the next first turning. But you have to realize that if you are going to shut down imports and exports, you're also going to shut down capital inflows and ex flows, right? That means we're going to have to fund our entire deficit on our own, which we haven't done for the last 20 years. That's going to lead to much higher interest rates totally aside from the inflation premium on it. And it suddenly means we're going to have to do something about the deficit. You know, all of this these things kind of follows like A follows B follows C. If if you're not going to have the the rest of the the flip side of our of our trade deficit is foreign capital inflows. And if you're not going to have one, you're not going to have the other. And it's it's interesting. I I often feel that it is so long as Trump is willing to say that we should suffer some pain now to get some gain later, um I often wonder instead of instead of all this tariff stuff, why not just start cutting the deficit? I mean, really, it's not not this Doge idiocy, right, which which isn't doing anything. I mean, he's basically firing people who administer social security benefits, which which is not even a rounding error. You know what I mean? In other words, you have to really do something about you have to like renegotiate the contract between America and its citizenry. Thank you. That's exactly what you have to do. And and he's not doing that. And I will say obviously one reason he doesn't do it is it's not something you can blame on other people. You know, it's just Yeah. I think there's like to rewrite the American contract requires a level of uh I and people have to allow you to do that and I don't think Trump has earned that that position with the enough of America to be able to renegotiate that contract. And I I think to some of the comments that you make in forth turning is here um like you you have to get through a crisis that is nearly existential before anybody's going to get that kind of authority. And at that time you you can at that and you can renegotiate it and it'll be up to Gen Xers who say, "Oh yeah, no problem. Yes or no?" You know what I mean? No problem. I got it. I'll do it. Just give me 15 minutes. I'll give it to me. This is what I love about Gen Xers, by the way. They're unweighed by all the It's just Yeah, you're right. I see it. The bottom line. I'll give you I'll give you the numbers in 15 minutes. That's Yeah. Yeah. I That That's fair. um you commented recently in some of your appearances about um sort of how how the sort of seculum the cycle seems to be sinking more and more globally as we become as we become a more global society. Um you talked about sort of Israel perhaps being right in the the culmination of their crisis at the moment. Um, if that's true, let's if we project that forward and we say, okay, we should be expecting similar patterns elsewhere, certainly in the in the culturally common world, is there some risk that uh effectively somebody gets there before us and builds institutions that we find preferable to those we might build ourselves?

Well, that's an interesting question. By the way, when you say um sinking, you mean s y s yn, not s. So, um, uh, I think the answer is obviously yes. I mean, look around the world. I mean, I I'll just start at random, right? Look at Vladimir Putin who's completely rebuilding Russia around this militarized anti-western state. I mean, he's building a war machine. And suddenly in Russia, instead of the army being this horrible place where uneducated refuge goes, it's the time for heroes. You know what I mean? he's giving these huge benefits now to veterans. He's lifting the incomes of these rural communities, you know, and so there's this huge recasting going on. Uh and the idea of of of some people in the White House that, you know, Trump can be suddenly brought over to the west and or distracted from Ukraine, I think is idiocy. I think he is this close to she right now, right? The two need each other, right? He needs Trump for for energy and for agriculture, right? You mean Putin? You mean Putin? She needs Putin. Oh, yes. Say that again. I got to say that. She needs Putin for energy and for for food staffs, right? And and for strategic depth. I mean, he needs that. And obviously Putin needs she because everything from the giant. Yeah. The incredible power of his economy. Um but think of all these rulers, right? These are all we would call them boomers. They were born after World War II. They were born after the great crisis that that we saw in all their countries. Um I mean take a look at um take a look at Narendra Modi in India to talk about another flash point. Now we have now we have Pakistan India to worry about, right? Two nuclear armed powers that are now lobbing artillery shells at each other. Uh these again are are the seniors who were born after the last crisis. The crisis in India was obvious creation and partition of uh in 1947, right? And then you have this uh you know this post catastrophe generation in China and throughout the Western Pacific of of World War II and the Chinese Revolution, right? Uh horrendous time. Um and and this is the new generation. And here's what they all have in common. Whether you're talking about Russia, Iran, India, China, I mean you go around the world, nobody alive today was an adult during the last crisis. They have all passed away, which is kind of always true, right? And that's always true. That's the amazing thing about the seculum, right? Is the era we're entering is exactly the era that no one any longer remembers, right? and and that and and it's interesting because recently we've seen all these 80y year anniversaries. You know, it's 80 year anniversary of be day. I believe that was two days ago, right? And and there you had, you know, Hitler, I don't know, in a few days Hitler's going to shoot himself in the head, you know, in his bunker and all the stuff. Um uh Eisenhower sends his victory telegram just like an excer. The victory telegram was only about 50 words. That was it. the Allied forces have accomplished their objective at something 100, you know, that would boom. That was it. That's all that's all Eisenhower telegraphed back home. Uh, and then this this this obviously this August, we're going to have the 80th anniversary of Nagasaki, Hiroshima, the signing of the the the the treaty on the, you know, the deck of the battleship and all the rest in in in Tokyo Bay. And so, it's funny though, we're all reliving this. We realize that anyone at this 80th anniversary who was age 20 at the time has to be a centinarian, right? We don't have a lot of them left. We have some. They're they're I don't know they're about 400 500,000 left, but they're but they're departing about they're they're shrinking at about onethird every year. Right. So this is this But this is interesting, isn't it? It have to repeat it. Yeah. I do.

Does it does this rebuilding the sort of epyrosis, the burning through fire and rebirth where the wild flowers can bloom, does this have to be stateoriented? I guess that was the point I was trying to make about institutions. I look at something like the rise in Bitcoin, just to be really specific about it, as in a way its own stateless institution. Uh do you is there a path you see forward where these aren't hard drawn lines on a map and are instead either culturally or ideologically drawn lines where we build institutions across borders or is that just pipe dream?

It's not necessarily state driven. That's not the essential part of it. Here's the essential part of it Dave. It's communitydriven. It's this intense community of the whole country becomes a band of brothers. That's what the society we learned. You cannot understand the American high. You cannot understand why we were the way we were culturally, socially, the suburbs, the huge middle class, everyone wearing the same gray flannel suit. I mean everything you remember of the late 40s50 and I'm I'm saying literally remember but but our image of that period you cannot understand it without understanding the crisis that scared the crap out of everyone that they had been through right coming together was the only thing that saved them and the generation which came of age in that the what we call the greatest generation that power of community is something they recall for the rest of their lives until the time they died whether it was in 1970s 80s 90s many of them were still voting for Ronald Reagan you know what I mean but my point is is that that's what they could not stand about their boomer kids their boomer kids all wanted to be individuals and they just thought you realize what the only reason we were able to build all this crap for you spoiled kids is that we were together we believed in community we're willing to tax everyone for these interstate highways and all these sewer systems and all these public colleges which you kids didn't pay a dime to go to. I mean, I was at California at the time. I went I went to UC San Diego, UC Berkeley. I think my my semester tuition was something like $25. I mean, that's all I paid. I mean, and and I mean, that's that seems like a late cycle problem because like even in the 80s, my college tuition now was like less than a car payment, you know? Because we we discovered markets. We thought they were beautiful, right? So anyway, uh but but but here's my point is that the fundamental insight of so much of social science and and uh uh you know and this was this was this was Max Vber and this this was Emil Darkheim and this was even in America we had William Graham Sumner and many many others right but their fundamental insight and they were all focused by the way on community this is a time these huge cities were growing throughout Europe and America and everyone was losing community. So the the fundamental subject of of the of the great first generation of social scientists was where does community come from? And I would say their common conclusion but one of the one of the axioms of social science as Robert Putnham you know put it in in his book bowling alone is that is that conflict is the incubator of community. It happens every time, right? And the reason why these nation states are so powerful and embodied community is that the repeatedly in the entire modern era, these conflicts of always worked to the aggregation of power in the nation state. Where do you think the nation state came from after the after the Renaissance when America was divided up and all these little duchies and communes and everything? Well, these nation what they called the new monarchies, you know, coming out of the late 14th and and and 15th and and early 16th century, these new monarchies um they they built big armies. They conquered these duchies. They conquered these re rebel nobles. They enlisted a a greater bureaucracy. They were able to extend their tax take. They were able to give more peace, greater commerce, greater productivity, more revenue, bigger armies. I mean you see where this is going. This is a positive cycle of nation building and and ultimately of course by the 19th century nationalism was considered a right of every people you know by Wedro Wilson that's why we went to war right to to allow every nation to have every you know nation to have its own nation right every cultural nation well and even even the Marshall plan was largely about respecting that belief system that Japan still had a right to be a country called Japan etc. We we even were willing to extend the Marshall Plan to Eastern Europe, but uh Stalin, he nixed that idea. I don't know why, but just said, you know, and it was funny because all these Polish leaders and and the and and particularly Yugoslavia kind of independently saying, can we can we I mean, it looks really great, you know. No. No. Well.

We know, we know, we know where that ended. Yeah. I want to, I want to, I don't want to take too much more of your time. I want to close back on this issue of, of sort of emerging elderdom. Um, I think we, you've really articulated for me a lot of what's emerging in terms of community formation. Uh, how, how the mores of society are changing as Gen Xers that are aging into elderhood, coming from our latchkey nomad ignored backgrounds. Does, does the implication that our, our focus as elders should be on helping form and support those communities that emerge during these crises, um, and that those communities eventually become institutions which then the millennials will take over and run? Is that sort of the path for us here?

Yeah, I mean, Xers will be, believe it or not, the, the solid anchors of their community, of their, whatever community you're talking about, even a neighborhood community or whatever kind of community you're talking, they will be the solid anchor at a time of tremendous crisis. They will be the no-nonsense pragmatic bottom line at a time when everyone around them is losing, you know, losing their minds, losing their minds. And, and in this, I will say, and, and, and combine that with a very protective style of nurture their children. And, and it's a real contrast, uh, you know, and, and, and I will say Xers will be the, you know, builders of walls, the creating of institutions that actually restrain people from being wild, right? This is kind of again, kind of Eisenhower's role, you know, strengthening the community. And you consider what an ironic role for Xers who learned to get along without any community.

Well, this is sort of my point. It's like we haven't trained on this. That this is exactly the yin and yang of the generational cycle, right? It's always a generation that's the least used to something that actually brings it back. And that's the amazing part of it. The, um, and I will tell you, at the other end of the cycle, and many Xers will be able to relate to this. Many Xers had parents, particularly the older Xers, I would say those born in the 1960s, had parents in the Silent Generation, right? These were the children of World War II and the Great Depression. And the Silent Generation came of age, famously conformist. You know, in college, their, their motto was, you know, um, um, you know, don't you know, don't do anything out, you know, don't do anything outside the lines, you know. Uh, uh, uh, uh, our goal isn't to change this. The GI Generation, uh, the Greatest Generation was also a huge generation of almost revolutionary change. Many of them joined the Communist Party. Many of them were socialists. They, they ended up conquering half the world. This was a dynamic generation institutionally. The Silent Generation, their motto just after World War II was, we don't want to change the system, we want to work within the system. And they all got these, you know, these, these higher degrees as being the, the tinkers and technocrats of the system. It would improve on the stuff that older generations were building. They were very conformist, right? And, um, and many of them took no chances. They, they married their first date in high school, right? And, and, and, and they did very well economically. I mean, many of them joined unions and, and got married and, and, you know, bought cars to practically age 20, 21, right, just coming out of high school. Um, but, but many of them regretted all that early conformity. And so many of them had the, um, the midlife crisis, you know, the late divorce, and, you know, all of the, you know, in kind of a wilder time.

So here's the contrast: is that the Silent Generation played by the rules totally when they were young, and ultimately by midlife, their problem was claustrophobia. You know, they just never knew what it was to break the rules and just step outside and take bigger chances. And so that's what they did. They had a much more experimental late life role in public leadership and in private leadership. I think Xers is just the opposite. You know, when they were young, they could do anything they wanted to. They don't give a crap. And their problem coming into midlife was what we call agoraphobia. You know, the fear of just endless open unlimited distance with no time horizons, no barriers, no structure. So, what the hell are you going to do that makes any difference in a world like that? Right. Right. So, it is their job to rebuild the barriers. See what I mean? There is something archetypal in this. And again, we see these roles happening again and again. They, the, the Silent Generation and the midlife awakening in midlife, you know, and they side with the Boomers in this, right? You know, these younger Boomers, I really envy them, you know, they're, they're doing all this as teens. I wish I could wear my long hair like that, but I'll help them break down the system, right? I think with Gen Xers is that, yeah, I'll help Millennials build the system again, and I'll help build some of these things, and I'll, I'll kind of teach the Millennials how to do it in a pragmatic way. So, I do see a very distinct role for Gen X, uh, not only later in the, in the, in the crisis, but certainly throughout the first journey to follow.

Great. Well, Neil, this has been unbelievably helpful just in my own thinking about my own life. I hope, I hope the listeners find it that way as well. Um, where can people find, uh, work that you're doing? You want to point people to? Uh, for now, it's just Demography Unplugged. We do a, uh, a weekly podcast on world events. That's no, um, and I, I, you know, my day job is, um, investment advising institutions. I'm, I'm head of demography at Hedgeye, you know, Hedgeye Risk Management. So.

Great. Well, thanks very much, Neil, and, uh, I hope hopefully we'll get to talk again soon. Thank you for listening. If you enjoyed this episode, please like and subscribe and tell a friend. No information in this podcast should be construed as investment advice. Securities discussed in the podcast may be holdings of the participants or their clients.