Charlotte Street Partners

DAILY BRIEFING

DAILY BRIEFING

Fruit of the doom

Written by Charlie Clegg, senior associate 
Edited by Kevin Pringle, partner
22 October 2021

Good morning,

Reports of the apocalypse have been greatly exaggerated. On birth rates, at least. 

Yes, births are going down. Covid hasn’t helped. Last week, the ONS published findings showing that birth rates in England and Wales have dropped for five years in a row and are now at their lowest levels since 2002. This largely conforms to a pattern in other western countries. Even in the global south, birth rates are slowing.  

One growing strand of commentary is to blame this drop on “baby doomers”: young adults whose fears of climate change have put them off bringing new life into a dying world.

It is true that an international study found four in ten 16 to 25-year-olds were hesitant about having children due to climate change fears. Other factors, however, are at play. For a start, 16 to 25-year-olds weren’t much affecting birth rates in the first place. The average age of a first mother in England and Wales was 28.9-years-old in 2019.

In the west, birth is just one of the landmarks pushed back by modern life. In the UK, the average age at first marriage is 31 for women and 33 for men; the average first-time home-buyer is 34. What’s causing this? One strand of commentary blames the UK’s expensive childcare rates and lack of affordable housing.

While the lack of housing has pushed back the age of house-buying, it’s unclear the former has much of an effect on child-bearing. Finland, a world-leader in childcare, has one of the lowest fertility rates in Europe.

Globally family size tends to decrease where affluence and opportunities for women increase. A Lancet paper last year predicted the world’s population would peak at 9.7bn in 2064 and decline to 8.8bn by 2100.

Is this all such a bad thing? Growing affluence is to be welcomed, as is the potential slowing of population growth: a major contributor to climate change. Slowing birth rates are, however, likely to drive down productivity and drive up generational inequality.

Birth rates present a global challenge over the course of decades. They’re also part of a larger shift towards longer lives and greater affluence. That, overall, is a good thing and one to which our adaptation as a species may be far easier and more natural than many now fear. Longer lives and the delay of major landmarks could be an opportunity for younger people to take more of life in

It’s right for us to keep an eye on declining global birth rates. They do not, however, represent our doom. Thank goodness.  

News

The Queen has returned to Windsor Castle after an overnight stay in hospital for medical check-ups. The Queen, who had been forced to cancel a visit to Northern Ireland on the advice of her doctors, spent Wednesday night in London’s Edward VII Hospital before returning to Windsor yesterday afternoon. This is the first time the Queen has stayed overnight in hospital since 2013. 

A court has heard that Ali Harbi Ali, the 25-year-old man charged with the killing of Sir David Amess MP, had been planning the attack for years. The remarks were made at a preliminary hearing at Westminster Magistrates Court yesterday. Ali is due to appears at London’s Old Bailey today. 

Laura Kuenssberg will step down as the BBC’s chief political editor after six years. She is expected to take up a role presenting BBC Radio 4’s flagship Today programme. The move is set to be part of a general reshuffle in BBC News’ top jobs. North America editor, Jon Sopel, is also stepping down and the post is being advertised internally. 

Cinematographer Halyna Hutchins has died after being accidentally shot by actor Alec Baldwin with a blank in a prop gun. The accident took place yesterday during filming in the US state of New Mexico. Hutchins was taken to hospital but later pronounced dead. The film’s director, Joel Souza, is also being treated for injuries. No charges have been filed. 

Business and economy

The Bank of England’s new chief economist, Huw Pill, has claimed he “would not be shocked” if UK inflation rose to over five per cent this winter. The bank of England’s annual inflation target is currently two per cent. Pill did, however, claim he believed inflation would decline in the latter half of 2022. 

The inaugural service of a new budget train between London and Edinburgh launched yesterday. The Lumo service has no first-class section but offers ticket prices beginning at £15, with 60% of ticket prices capped at under £30. A regular service will begin from Monday. 

FirstGroup has announced the £125m sale of its Greyhound brand of North American buses. German company FlixMobility has bought the iconic service. FirstGroup will, however, temporarily retain control of depots, terminals, and staff pensions. FirstGroup’s acting chief executive, David Martin, did not rule out further forays into the North American market but claimed the company’s priority for expansion would be Europe. 

Columns of note

In Hungary, diverse opposition parties have banded together in an attempt to block the return to power of sitting prime minister, Viktor Orban. The opposition’s candidate is Peter Marki-Zay: the little-known mayor of an obscure southern town. In the Financial Times, Tony Barber looks at the stakes for Hungary’s opposition. If they succeed, they will show that a nascent autocracy can be toppled. If they fail, Orban’s illiberal regime will gain further impunity. (£) 

In Germany, a coalition between the SDP, FDP, and Greens looks settled; however, negotiations over the finance ministry are becoming fierce. The FDP’s leader, Christian Lindner, and his Green equivalent, Robert Habeck, are battling for the job. In The Guardian, Adam Tooze argues that the fight between the fiscally conservative Lindner and Greens’ big-spending instincts will affect all of Europe. Germany’s immense power means Lindner as finance minister could add to the momentum for debt restriction across the continent. 

Cartoon source: The Telegraph

Markets

What happened yesterday?

Strong earnings from major companies such as Microsoft, Tesla, Netflix, and Amazon drove up stocks on Wall Street yesterday. The S&P500 closed up 0.3%, continuing seven consecutive days of growth: the longest streak since June. Meanwhile, the Nasdaq Composite gained 0.6%. 

Outside the US, however, both London’s FTSE 100 and Hong Kong’s Hang Seng index slipped 0.5% as shares exposed to China’s slowing economy dropped. Europe’s Stoxx600, meanwhile, closed flat. 

The pound was trading at 1.38 dollars and at 1.19 euros. 
 
In company news:

WeWork’s shares have jumped 16% after its merger with SPAC, BowX Acquisition Corp. 

AT&T has beaten expectations for third quarter earnings as it has succeeded in adding new phone and broadband customers. 

What’s happening today?

Finals  

Virgin Wines 

Trading announcements 

InterContinental Hotels  

Record  

AGMs 

Duke Royalty  

Fiske  

Superdry 

EGMs  

Global Ports S  

UK economic announcements 

(00:01) GFK Consumer Confidence 

(07:00) Retail Sales 

Int. economic announcements 

(10:00) IFO Expectations (GER) 

(10:00) IFO Current Assessment (GER) 

(10:00) IFO Business Climate (GER) 

Source: Financial Times

did you know

The filling in Jaffa Cakes is mostly
composed of apricots flavoured with tangerine oil.

Parliamentary highlights

House of Commons

Private members’ bills 

Various 

House of Lords 

Legislation 

Assisted Dying Bill [HL] – second reading 

Scottish parliament 

The Scottish parliament is in recess. The parliament will next sit on 26 October 2021.

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