Buttonwood's notebook

THE theme for this year's Davos conference is, apparently, resilient dynamism. That leads me to propose a rule; if you can plausibly change the words around, the phrase is meaningless. Dynamic resilience makes just as much, or little, sense. Indeed, it would be a better advertising slogan; New cornflakes with added dynamic resilience!

Last year's theme was "Shared Norms for the New Reality" which could, just have easily, have read "Shared Realities for the New Norm".  Politics provides other examples. Hillary Clinton's 2008 slogan "Working for Change" sounds even better as "Changing for Work".

THE post-war generation of baby boomers—those born between 1946 and 1964—have had a huge impact on the world, creating "youth culture", changing social attitudes from the sixties onwards, boosting economic growth as they entered the workforce and so on. Now they are starting to retire and this blog has banged on about the effect this will have on issues like pensions, asset markets and economic growth. Not to worry, say some folks, because although we may have more elderly to look after, we will have fewer children.

Alas, that won't help, as this graph compiled by statistician Simon Hedlin shows.

ANDREW Lapthorne is the least-publicised of Socgen's strategy team but he gave an excellent presentation at Tuesday's annual seminar. He looked, in particular, at what US quoted companies have actually been doing with their money; some of his key charts are reproduced here.

It is widely known that US profits have rebounded but the bottom chart shows that there has been a big impetus from monetary policy; thanks to lower rates, net income has risen much faster than earnings before interest and tax. Credit to the Federal Reserve on this point; lower rates have done the job. It is worth noting, however, that this gap must close; rates can't really get any lower.

LIVE long and prosper was Mr Spock's salute, but the interesting thing about Americans is that, prosperous as they may be, they do not live as long as many other nations. Males live around four years less than their Swiss counterparts, and females 5.5 years behind the Japanese. And the gap is widening. British females had a lower life expectancy than Americans in 1980; now they can expect to live 1.6 years longer. British males have gone from being roughly level to being more than two years ahead.

THE closest thing to a risk-free asset is an inflation-linked government bond. Governments that issue debt in their own currency, and have a compliant central bank, should be able to avoid a nominal default on their debt, but investors risk seeing the real value of their capital decline. Inflation-linked bonds were designed to ressure creditors on this ground. Ironically enough issuance took off the 1980s and 1990s at a time when inflation was relatively subdued, so governments have not been overburdened with servicing the debt.

DESPITE the debate about the fiscal problems of America (or indeed Britain) and a sell-off in the last few days, government bond yields are at very low levels. For much of history, governments would have been delighted to be able to borrow for 10 years at 1.8%, as the US Treasury can today.

One way of interpreting those low yields is in terms of the demand for safe assets, as an intriguing paper from the Bank for International Settlements discusses. It is a rich theme. One aspect is the way that Asian central banks built up their foreign exchange reserves after the crisis of the late 1990s, driving down Treasury bond yields.

EUROPE's politicians are often berated for an excessive focus on austerity. And it seems likely that there is a huge problem with several countries pursuing austerity simultaneously. One cannot switch the economy from domestic consumption to exports, if all your neighbours are trying to do the same. Canada's success in the 1990s occurred during the great boom of its biggest trading partner, the US.