Demographic enthusiasts such as myself are a dystopian cult compared to celebrity economists who are far more exciting with their interesting theories, complicated equations, and endless outcomes that provide content for economic conferences and dinner parties.

I offer this boredom warning, with one caveat, unlike economists, demographers are usually right.

2019 will be the year the world discovers that demographics truly are destiny and what will drive the world economy and global politics will be demographics as we adjust to an aging population, especially in China.

In 2019 we will finally see falling birth rates factored into economic modeling for real estate in China, Taiwan, Japan, & Korea with the same emphasis as interest rates and affordability. I believe that China's population growth is flat and possibly inverted already. Global Times reports that for 2018 China had 15 million births, off just over 2 million from 2016. That's a 12% drop in two years. Fewer people, an increasing death rate, and an aging population is going to hold down housing prices no matter what central banks concoct.

The hollow rural towns of Japan are coming to China.

Second impact of demographics to be considered is that labor will be seen as the number one problem of business by the end of 2019. Technical innovation and access to capital will be secondary problems for managers as they first must attract talent from a shrinking pool of potential workers.

Labor shortages will drive migration as nations pull the most talented workers away from less desirable living conditions. China's Communist Party, will face a huge challenge as an elite that is educated abroad will be less inclined to return to a repressive nation, especially when others are seeking their skills. China's labor price advantage is already being lost to automation and cheaper/poorer nations. The CCP will have to deliver an economic playing field where value added industries can thrive. Dictatorships don't have a good record of being at the top of any value chain.

In terms of War & Peace, while President Xi talks a good game militarily, the shrinkage of the PLA will continue as the economy eats up potential young recruits and manpower shortages grow as an issue. The PLA is not shrinking for the sake of efficiency alone. China's Navy may be getting two new combatants each month, but if you can't get the crew for them?

As for China's opponents. Taiwan can't even fully man their military today and Japan is spent in terms of potential new recruits.

This is all upside as it's harder to go to war for any sustained period when you start running out of men. With only one son in a family, even in communist China, there is limited appetite for casualties. Does it mean no more wars? No. But it does mean limited cannon fodder to throw into battle.

Demographics are destiny and this short comment doesn't do much more than skim the surface that the impact of fewer people will have in our world. But my bet is in 2019, whether talking money or power, we will hear more folks start to understand that fewer babies and aging populations will be the economic drivers of the future.