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L. Stephen Coles, M.D., Ph.D., Lecturer,
UCLA Molecular Biology Institute
Department of Chemistry and Biochemistry
Los Angeles, California; USA
How Global Demographics & Monetary Policies are
Affecting the World’s Retirement SystemsSupercentenarian Longevity: Secrets of the Oldest Old
Sean Connery
British scientists analyzed the vast amounts of EtOH consumed
by superspy James Bond, 007, in Ian Fleming’s novels and
concluded that he would contract alcoholic hepatitis, cirrhosis,
impotence, and die of liver disease by the age of 56 years.
Lisa Gherardini (who died in 1542 AD) suggested as a model for Leonardo da Vinci’s “Mona
Lisa” (“La Gioconda”)(Louvre Museum; Paris, FRANCE)
Archeologists have now unearthed a skeleton in a monastery in Florence, ITALY and will do
DNA analysis to confirm identity
We’re Getting Old — Very Old
• Population aging is a world-wide phenomenon
• Over next several decades, the proportion of elderly persons (65+) in all major industrial countries will increase rapidly as the share of the total adult population declines
• For example, in the U.S., there were
• 35 million adults age 65+ in 2000
• 50 million in 2010
• 70 million, or 1 in 5 Americans, in 2030
% Population Age 65+ [2000 – 2020]
Country 2000 2020 Percent Change,
2000–2020
Japan 17.1 26.2 53.7
Canada 12.8 18.2 42.9
Australia 12.1 16.8 39.2
New Zealand 11.6 15.6 33.7
United States 12.5 16.6 32.8
Germany 16.4 21.6 31.9
France 15.9 20.1 26.4
United Kingdom 16.0 19.8 23.6
Source: United Nations
% Population Age 65+ [2000 – 2020]
United States
United KingdomCanada
Australia
New Zealand
Germany
France
Japan
United States
United Kingdom
Canada
New Zealand
Germany
France
Japan
Australia
% Population Age 80+ [2000 – 2020]
Why Is That?We are having fewer children and living longer, much longer on the average
In fact, in 1889, the first Social Security Law was enacted in Germany by Prince Otto von Bismarck
(the "Iron Chancellor" under Kaiser Wilhelm, II), when those retiring at 65 had only a five (5)-year
life expectancy (on average) [and most workers died before they even could retire].
Life Expectancy by Country and Gender in 2000 and 2020
Country 2000 2020
Men Women Difference Men Women Difference
France 75.0 82.5 7.5 77.0 84.2 7.2
Japan 77.2 83.3 6.1 78.8 84.9 6.1
United States 74.2 80.6 6.4 76.8 82.6 5.8
Germany 74.7 80.7 6.0 77.0 82.7 5.7
Canada 76.6 82.3 5.8 78.4 84.0 5.7
Australia 76.0 81.6 5.7 78.0 83.4 5.5
New Zealand 74.9 80.5 5.6 77.2 82.5 5.3
United Kingdom 75.3 80.6 5.3 77.3 82.6 5.3
So What?• The social/economic implications of population aging in developed
countries are extremely serious
• Large effects on financial markets due to changes in saving rates and the demand for investment funds
• Also, significant changes in labor force
• As the median age of the world rises from 29 to 38 by 2050, the labor force will shrink and more people will retire, leaving fewer younger workers to sustain growth and sapping the vitality of economies all over the world
• Italy, for example, will need to raise retirement age to 77 or admit 2.2 million immigrants annually to maintain its worker-to-retiree ratio
Who is a Supercentenarian?
• As of today (Thursday, June 19, 2014), there were 74 Validated Living Supercentenarians World Wide
(USA : non US = 22 : 52) (Female : Male = 72 : 2)!
• Once you were to make it to becoming a Supercentenarian, the chances of living even one more year to 111 is like flipping a coin! (H:T or a 50% mortality rate)
• Therefore, these individuals are a very precious resource for humanity, and we need to act quickly; otherwise, whatever they have to teach us about how they managed to live so long will be lost forever
The Oldest Documented Supercentenarian in History
40 years 120 years
According to the Guinness Book of World Records, the oldest documented Supercentenarian in history was French woman Madame Jeanne-Louise Calment, who died in 1997 at 122 years, 164 days
Rectangularization of LongevityWhile Prof. James Fries’s “Compression of Morbidity" hypothesis may not be
entirely correct, there is a definite “Rectangularization” of the human longevity
curve, and it is becoming stronger with the passage of time
If we take Japanese centenarians as one example…
• In 1992, there were 3,000 centenarians; oldest person = 114 years
• In 1998, there were 10,000 centenarians; oldest person = 114 years
• In 2009, there were 40,000 centenarians; oldest person = 114 years
Rather than seeing an increase in the maximum ages, as expected, we are seeing
an increase in the mortality rates instead, especially at ages 112, 113, 114, and 115,
with very few persons anywhere reaching age 116 (last occurrence was 2006) and
age 117 or more turns out to be an extreme outlier (last occurrence was in 1997)
Country Age
France 122(While Jeanne Calment reached age 122, she definitely was not walking around at age 120)
UK 115 (The oldest British person since modern birth registration began in 1837)
Spain 114
Italy 114
Sweden 113
Oldest by Country
1. Christopher Driver, “Opinion: A Further Comment on Why the Gompertz Plot Does Not Measure Aging” Biogerontology, Vol. 4, pp. 325-7 (2003).
2. James R. Carey, et al., “Slowing of Mortality Rates at Older Ages in Large Medfly Cohorts,” Science Vol. 258, No. 5081, pp. 457-61 (1992).
Mortality Plateau for Fruit Flies
Supercentenarian Mortality Rates
Data provided by Messrs. Robert D. Young of Atlanta GA and Mark E. Muir of Virginia, GRG Database Administrators
Hypothesis: Nature, Not Nurture Causes Aging & Senescence
• Potential Longevity (Both Average Life Expectancy & Maximum Lifespan) Lies in
the expression of our genes (including Epigenetics)
• Longevity-Determining Genes (a few hundred genes out of 20,000+/-) & not our
environment or life-style dictate how long we may be able to live
• None of our Supercentenarians took supplements
• Our greatest system vulnerability is vascular fragility (we have
~60,000 miles of blood vessels)
Female Advantage
Female:Male Overall Ratio ~10:1. And by age
• 110 Years 90 percent are women
• 112 Years 92 percent are women
• 115 Years 95 percent are women
Why is that?
1. Women Deliver Babies (C-Sections)
2. Men Fight for Species Survival (T, Cortisol)
3. Estrogen? (Post Menopausal > ½ Life)
4. “XX” (Mosaic) and not “XY” (Y = tiny)
Supercentenarian Genome Project(IRB approval July 2010)
The SRF in collaboration with…
• UCLA (Dept. of Chemistry and Biochemistry Molecular Biology Institute)
• Stanford University (Depts. of Developmental Biology and Human Genetics)
• Institute for Systems Biology of Seattle, WA
• Complete Genomics of Mountain View, CA
Two Subjects from San Diego, CASoledad Mexia, 114 years [1899 - 2013]
&Frederica Maas, 111 years [1900 – 2012]
Antonia Gerena-Rivera110 years
Miami, FL (Born in Puerto Rico)
(Insert Photo from Visit on Sunday, May 1, 2011, 4:00 PM EDT)
Mr. James F. McCoubrey111 years
[1901 - 2013]St. John’s, Newfoundland; Halifax, Nova Scotia;
Cambridge, MA; Walnut Creek, CA
Dr. Alexander Imich, Ph.D.111 years
Born in Poland & Resided in NYC(Confirmed as World’s Oldest Man – May 12, 2014)
[February 4, 1903 – June 15, 2014]
The Cost of DNA Sequencing is Falling
2000 $3 Billion (Shot-Gun of a Mosaic)
2005 $100 Million (Craig Venter, James Watson)
2010 $1 Million
2011 $200 K (George Church at Harvard)
2012 $4 K
2013 $1,000 (Illumina)
2015 $200 (nearly all newborns will be sequenced)
Argument: What if Ray Kurzweil is right?
Era Life Expectancy (years)
1. 100 KYA (Hunter/Gatherers) 18
2. 5 KYA (Ancient Egypt) 25
3. 1400 AD (Middle Ages) 30
4. 1800 (USA) 37
5. 1900 (USA) 49
6. 2000 (USA) 78
7. 2045 (Singularity) Biological Escape Velocity
L. Stephen Coles, M.D., Ph.D., Lecturer,
UCLA Molecular Biology Institute
Department of Chemistry and Biochemistry
Los Angeles, California; USA
How Global Demographics & Monetary Policies are
Affecting the World’s Retirement SystemsSupercentenarian Longevity: Secrets of the Oldest Old
Robert C. Merton
School of Management Distinguished Professor of Finance
MIT Sloan School of Management
How Global Demographics and Monetary
Policies are Affecting the World’s
Retirement Systems: Interest Rate Risk
Effect of Interest Rate Level on Retirement FundingPrice of $100,000 per year Inflation-Protected Life Annuity Beginning at Age 65
1.2
1.3
1.4
1.5
1.6
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1.8
1.9
22
.1
An
nu
ity P
rice (
$ m
illio
ns)
-1.0% -0.5% 0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0%Real Interest Rate
1 1
11
TA
r r
65
Effect of Interest Rate Level on Retirement
Funding
Price of $100,000 per year Inflation-Protected Life
Annuity Beginning at Age 65Present Value of Annuity ($ millions)
Real Interest Rate
Current Age 4.13% 1.50%Difference in
Cost (%) 0.50%Difference in
Cost (%)
65 $1.30 $1.64 26% $1.81 10%
60 $1.06 $1.52 44% $1.76 16%
55 $0.87 $1.42 63% $1.72 22%
50 $0.71 $1.31 86% $1.68 28%
45 $0.58 $1.22 111% $1.64 34%
66
Effect of Interest Rate Level on Retirement Funding
Price of $100,000 per year Inflation-Protected Life Annuity Beginning at Age 65
4.1% 0.62 0.69 0.72 0.79 0.87 1.00
2.5% 0.71 0.79 0.83 0.91 1.00 1.15
Interest Rate R
1.5% 0.78 0.86 0.91 1.00 1.10 1.26
0.5% 0.86 0.95 1.00 1.10 1.21 1.39
0.0% 0.90 1.00 1.05 1.16 1.27 1.46
-1.0% 1.00 1.11 1.16 1.28 1.40 1.62
-1.0% 0.0% 0.5% 1.5% 2.5% 4.1%
Interest Rate r
Annuity Price at Interest Rate RRatio:
Annuity Price at Interest Rate r
67
30-year UST TIPS Interest Rates 2007 -2014
-0.50
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
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Yie
ld (
%)
30-year TIPS Bond Yield
30-year 3-5/8% 2028 TIPS 30-year TIPS, constant maturity
68
Wrong Risk Measure: Retirement Funding has an Income Goal But DC Investing Focuses on Wealth Accumulation
69
Deferred Real Annuity monthly returns
Annuity returns based on yield from US Treasury Inflation Protected Securities (TIPS). Data provided by Bloomberg.
Deferred Annuity: High risk in wealth terms, low risk in income terms
DEFERRED ANNUITY (INCOME UNITS)DEFERRED ANNUITY (USD)
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
2/03 12/0310/04 8/05 6/06 4/07 2/08 12/0810/09 8/10 6/11 4/12
Retu
rns
Months
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
2/03 12/0310/04 8/05 6/06 4/07 2/08 12/0810/09 8/10 6/11 4/12
Retu
rns
Months
The volatility of annuity price is high risk when measured
in terms of asset value.
The volatility of annuity price is minimum risk
when measured in terms of income
Wrong Risk Measure: Retirement Funding has an Income Goal But DC Investing Focuses on Wealth Accumulation
70
90-Day US T-bill monthly returns
Based on T-bill data provided by Bloomberg. Past performance is no guarantee of future results.
US T-Bill : Wealth preservation does not mean income preservation.
3-MONTH US T-BILL (INCOME UNITS)3-MONTH US T-BILL (USD)
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
2/03 12/0310/04 8/05 6/06 4/07 2/08 12/0810/09 8/10 6/11 4/12
Retu
rns
Months
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
2/03 12/0310/04 8/05 6/06 4/07 2/08 12/0810/09 8/10 6/11 4/12
Retu
rns
Months
The volatility US T-bill price is minimum risk when measured
in terms of asset value. The volatility of US T-bill price is high risk when
measured in terms of income.