Yuppy/nerd ratio wrong

Press, 6 July 1988, Page 35

Yuppy/nerd ratio wrong

PA Sydney High living yuppies have a lot to answer for. Their freewheeling spending on frivolous imports has contributed strongly to Australia’s patchy economic performance, according to a Syndey bank economist.

But as Australia’s population ages, the proportion of yuppies will decline and there will be a corresponding rise in household savings.

An economist with Dominguez Barry Samuel Montagu Securities, Dr Ray Block, said yuppies — those 25-to-35 year-old upwardly mobile professionals — were inclined to dissipate money on restaurant meals, imported cars, video and audio equipment, brokerage fees, yachts, and recreational drugs. “Their activity, usually

funded by plastic cards, produces unproductive debt and worsens Australia’s trade balance with Japan. “The nerds, those over 40 who save hard and invest wisely, help economic growth that yuppies so effectively retard.

“Australia’s poor personal savings record was all because of the yuppie/nerd ratio,” Dr Block said. Its savings ratio is lower than most of its trading partners which all have a higher average population age. The average age of the Australian population is 10 years behind that of Japan and Europe, and a couple of years behind America. But the important .thing is that Australians are betting older. “It’s an involuntary thing, but by the mid-nineties a

greater proportion of the population will be in the 40-to-50 age bracket,” he said. And their more mature spending and savings habits will have a bigger impact on the economy than they do at present. \