The Pensioner Crisis comes to Germany
The world's first state pension was introduced in Germany in 1889. It was the brainchild of the legendary Otto von Bismarck and provided a state pension from the age of 70. In 1916, the state pension age was reduced to 65, and it's remained there till now.
However, Germany is facing serious demographic headwinds. The following graphic shows how many workers it takes to support one pensioner:
The German government has responded by setting up an additional pension scheme, which involves the government investing in the stock market. The idea is to break away from purely tax-funded schemes and let investment growth take some of the strain. It's a gamble that requires the economy and the markets to do well.
In the short term, this money flowing into the markets should boost stocks.