This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

S&P: Age-Related Spending Reforms Help Restore Sovereign Fiscal Sustainability; Emerging Markets Not Immune To Aging Pressure

Stocks in this article: MHP

NEW YORK, March 20, 2013 /PRNewswire/ -- Standard & Poor's Ratings Services has seen a significant improvement in the budgetary positions of wealthier sovereigns since its 2010 global review of the impact of aging societies on public finances. While the rapid buildup of government debt since 2007-2008--and the resulting large deficits posted by many rated sovereigns--focused attention on age-related spending, a number of sovereigns have overhauled their public pension or health care systems--the two components of age-related programs that typically account for about 40% of government spending, according to a report released today by Standard & Poor's. The report, Global Aging 2013: Rising To The Challenge, updates Standard & Poor's 2010 report, and continues a series begun in 2002 that analyzes the fiscal effects of aging populations.

"If sovereigns overcome their post-crisis economic and budgetary difficulties and successfully adapt their social security systems to demographic challenges, pressures on public finances exerted by aging populations could be gradually contained over the long term--a somewhat surprising conclusion at this stage of the sovereign debt crisis," said Marko Mrsnik, sovereign analyst at Standard & Poor's and author of the report.

Several nations have begun to implement health care and pension measures to accommodate both their aging populations as well as their near-term budgetary pressures, although the impact of these measures in some countries is offset by economic weakness and diminished employment levels. Coupled with higher borrowing costs, such measures can hamper efforts to stabilize debt dynamics. Standard & Poor's believes, however, that if continued, the structural changes and budget consolidation processes many sovereigns have recently implemented should improve their prospects for maintaining sustainable public finances.

"This may be the start of a decades-long period of tension between two different priorities: public spending on pensions and health care for aging populations versus the need to contain sovereign budget deficits and debt," said Mr. Mrsnik.

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,805.41 +127.51 0.76%
S&P 500 1,964.58 +13.76 0.71%
NASDAQ 4,483.7150 +30.9230 0.69%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs