It was supposed to be a play in three acts. Wall Street banks and the US economy took the first blow from the Lehman crisis. Next, the epicentre of trouble moved to Europe, causing a run on sovereign debt. The overhang of global borrowing was then going to culminate in a big emerging-market fiasco, caused perhaps by a disorderly unwinding of China’s post-Lehman credit bubble. That dénouement never materialised for an under-appreciated reason: the forces that hastened Lehman’s demise have steadied emerging markets ever since. Discussions about the origins of the pre-Lehman exuberance focus too much on bankers shuffling risky sub-prime mortgages into triple-A-rated securities. They often miss something more fundamental: the Baby Boomer generation’s quest to secure retirement. A four-year jump in US life expectancy between 1990 and 2015 (to 79 years) gave wings to this motivation at the peak of the boomers’ earning power. Among other things, an oversupply of retirement savings relative...

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