I draw the line at saxophone

To be clear, I have nothing against the saxophone. It’s a beautiful instrument that, when played correctly, can make a nice jazzy noise. As you can tell by my questionable descriptor, musical instruments are not my thing. 

They are, however, my daughter’s. Almost every year, a new instrument is picked up (as in purchased or rented by her parents). First came the piano (to be fair, we gave her little choice in the matter). Next, the violin (it was suggested a second instrument would help with her piano). Then came the guitar (a “summer” instrument, when piano and violin fall by the wayside). Then, thanks to school band, came the flute (by no encouragement of her parents whatsoever). And now that she’ll be in grade seven, she’s eligible to join the jazz band and play, yes, the saxophone (or, as Homer Simpson liked to say, Saxamaphooone). 

I'm sure it's normal for some kids to pick up a new instrument year after year, thinking it will be the next best and greatest, and drop the one they tried to play a year earlier. That sounds normal. 

What’s not normal is continuing to play the instruments you’ve already started to learn – a kind of musical instrument hoarding, if you will. There is a reluctance on my daughter’s part to give up any of her instruments. 

“You may need to drop violin next year,” I tell her, suggesting that her extra-curricular activities are going to rob her of what’s left of her pre-pubescent childhood. “You like to play with your friends, right?” 

“Yeah, but I don’t want to quit violin,” she responds. “Or flute,” she blurts, before I can even suggest it. 

My wife has even suggested she quit piano, after five years of agonized practicing. 

I would rather she simply quit picking up new instruments. 

Sure, there are positive effects of learning a musical instrument. Children involved in music tend to do better academically and may even be happier. My daughter practices so much, there’s no time to be depressed. 

But there’s also that thing called the law of diminishing returns... The more instruments, the lower the marginal benefit. That fifth instrument will only increase your happiness marginally more than the fourth. In fact, it may even make you, and your parents, less happy. 

Practicing is a lonely undertaking that tests your self-discipline and your parents’ patience. While my daughter prefers I be in the same room as her when she practices, I’ve been known to sneak quietly into the basement to escape what I will call the noise. 

The noise is particularly acute when our daughter is learning a new instrument. The first few months of violin were excruciating. I can only imagine a saxophone. 

In those instances, I find things I can do... elsewhere. 

My daughter conveyed this to her band teacher the other day: “My dad likes to go in the basement when I start playing the flute." 

“Oh really?” she said, apparently shocked by the revelation. “Why would he do that?” 

“He doesn’t like it when I play the loud parts.” 

“Oh really... And what does he do downstairs?” 

Thankfully, my daughter didn’t have an answer. I have no idea why her band teacher is interested in what I do in our basement.

I can assure her of one thing – I don’t practice the saxophone. 

Immigrants more valuable than ever

Full disclosure: I’m married to an immigrant. 

That doesn’t mean I’m free of bias or even bigotry. But like most Canadians, my views are mostly positive when it comes to newcomers to our country. 

Which is good, because we accept a lot of them. In 2018, over 320,000 immigrants arrived, the second most since 1913. Over one hundred years ago, if you can imagine, more than 400,000 immigrants arrived in one year – increasing Canada’s population by 6% in one fell swoop. That would be like accepting over two million immigrants today! 

Still, 320,000 newcomers is nothing to sneeze at. It’s three times the rate per capita as the United States and more than any other G7 country. Currently, twenty percent of Canada’s population was not born in Canada because of our open-door policy. 

Why does it matter? Because if it weren’t for immigrants, our population would be in decline. Like almost all developed countries, our fertility rate is below the magic replacement rate of 2.1 children per woman. Anything lower than this leads to a smaller, older population, as we already see in many parts of Europe and Asia. 

Even populous China will soon be in decline – historically, due to government’s disastrous one-child policy, but today due to economic growth and urbanization. If the worst comes to pass, its population will be reduced to just over 600 million people by 2100, less than half of its population today. 

Much of Europe, Japan, and Korea are already in the thralls of a population bust, where government authorities are doing all they can to encourage more babies.  

The problem is, women (and their significant others) aren’t listening. According to Darrell Bricker and John Ibbitson’s book, Empty Planet: The Shock of Global Population Decline, this is a natural outcome as nations become more and more urbanized. Children in urban areas, whether in the slums of Calcutta or the high rises of Manhattan, are costly, providing a declining marginal benefit with each additional child. 

Along with better education and the empowerment of women, declining fertility rates are a trend worldwide. 

As a consequence, Bricker and Ibbitson hypothesize that the world's population will peak at around 8.5 million people by 2050, and then start to decline, rapidly. “So rapidly that by the end of the century the planetary population would be back down to around 7 billion, where it is right now.” 

To be fair, this is the UN’s “low variant” population forecast. The UN’s medium variant scenario, one that UN demographers feel is more likely, sees world population peaking at around 11 billion by 2100, then going into decline. 

The authors contest this scenario, suggesting the UN is not incorporating the precipitous decline in birth rates that are already occurring. In China, for example, the UN predicts that fertility rates will actually increase. Yet typically, once fertility rates go down, they rarely go back up.

Like Japan, whose population will decline by 25% in the next 35 years, almost all countries will eventually face an older, smaller population, thereby limiting growth and influence. 

Unless they can attract newcomers.  

On this front, Canada is uniquely ahead of the curve. 

The markets smile on the rich

My financial advisor wasn’t too worried about the losses on my annual statement. He explained it all in very plain English. You see, the “Trump bump” of 2017 was followed by a minor “Trump slump” in 2018.... yada yada yada... investments always recover... look at this chart... and something about China.  

I’ve found that they often throw in a word about China. I had a financial advisor once tell me that it was a great time to invest because all the kids in China were spoiled. All the stuff their parents were going to buy them would fuel a booming global economy. Turns out, he was bang on (hey, I don’t have a better explanation). 

We have a strange way of explaining the ups and downs of the markets because, let’s be honest, no one really knows how they work. Every day we struggle to understand them by deciphering their mood. 

“How are the markets doing?” I hear every morning on the radio, as though they were our children. Moody children at that. When the markets are happy, we’re happy. When they throw a tantrum, we bristle with fear. 

Ten years ago, the fear was very real. For many, the stock market crash of 2008-09 was about more than just losing savings. It was a colossal banking failure that led to the foreclosure of millions of homes in the U.S., mass unemployment, and ultimately the crisis in the E.U. and Eastern Europe. 

In his book, Crashed: How a Decade of Financial Crises Changed the World, Adam Tooze delves deeply into the past ten tumultuous years. Reading the chronology of events is like understanding the aftermath of a hurricane. Few things are left the same. To rebuild takes years, and some never recover. 

Allow me to summarize his 600-page book in 300 words or less... 

The great Wall Street rescue of 2008-09 was a heroic undertaking. After Lehmann Brothers collapsed, the U.S. government quickly realized that these giant financial dominoes were too big to fail. Government rescued the banks in an effort to avert a full-scale economic disaster. 

While Tooze claims this bailout was needed, he suggests the ensuing stimulus was inadequate. While the markets began their recovery in the summer of 2009, American home prices bottomed out only in 2011, with unemployment rates at record levels for years to come. The pressure on government to reign in deficits, however, was unrelenting. After the worst economic recession in modern history, why would government need to help out ordinary people? 

Across the Atlantic, certain European leaders were even less sympathetic. British Prime Minister David Cameron, who also brought us Brexit, introduced austerity budgets while Germany’s Angela Merkel refused to come to the aid of her poorer EU neighbours. 

Greece paid the biggest price, with unemployment rates of young adults hitting 50% as late as 2015, and its GDP well below 2009 levels. Its EU-imposed austerity budgets were epic failures, threatening the very existence of the Eurozone. 

The Great Recession left many lives scattered in its wake. Arguably, it led to the rise of far-right political parties in Europe, Brexit, and the election of Donald Trump.  

It was in the midst of this economic disarray, ironic enough, that the U.S. stock market had one of its greatest bull runs in modern history. Those lucky enough to have money to invest did very well. 

I should know, for I was one of them. Yes, an oft-forgotten RRSP worth a grand total of $900 lay quietly in my name in 2009. I wish I could say I’m now ready to retire. 

Most of the lower middle class don’t benefit from the markets. Only half of Americans invest, with a much smaller percentage investing significant amounts. 

As I recall my initial panic when I saw the losses on my annual statement, I can’t help but feel a twinge of guilt. The markets are a bit of a game, after all, that make the rich even richer. 

Over the past ten years, governments of all stripes have made sure of that.