But, while it is an inconvenience when braving the crowds in a mad Christmas eve dash, it belies a much more profound problem for asset allocators – populations (and by extension, investors) in the West are getting older.
And as they age, not only do the economics of consumption change, but also they demand more income from their retirement plans.
For Investec Asset Management global investment strategist Michael Power, these changing demographics are going to play a key role in the performance of various asset classes over the next decade and, he believes, many asset allocators have yet to catch up with “the profound implications of an aging population”.
Power explained that it is these demographics that are largely behind the performance seen from bonds of late, which have not given up as much ground as many had expected.
People need yield, especially older investors, he argues, and they want security. But while Western bond markets ostensibly are able to offer security, they are just not going to be able to offer the kind of yields for which people are looking and so, they are going to be forced to look further afield.
As a result of this, Power believes over the next 10 years people will increase their exposure to emerging market bonds because they can provide “quasi-bond-like security (albeit not without issues) but with better yield”.
He added: "Sensible intermediaries should be able to mitigate most of the risks involved."
In this context, Power is especially optimistic about Asian bonds, because not only do the countries in this region have a strong demographic dividend and an emerging middle class, but most are also running current account surpluses.
“Asian bond funds will probably be the largest asset class in terms of growth over the next decade, because a lot of Asia is going to recycle its savings, not into the Western bond markets, but into itself in the bond markets that will develop in Asia – and western investors will piggyback on that,” he added.
