📈  Chart of the Week 6/21/2026

By Michael Allison, CFA

Does the Bull Market End With the Boomers?

It’s been a while since we had a demographic-related Chart, so when I ran across this one, I found it interesting enough to write about.

Here’s the worry on the minds of many investors. Baby Boomers hold about $89.7 trillion in net worth, more than the Silent Generation, Gen X, and Millennials combined. Boomers and the generation ahead of them own close to 70% of all the stocks, and they’re retiring. Somewhere between 40 and 50 million of them already are.

So the story writes itself.

The cohort that bought equities for 40 years turns into sellers. Required minimum distributions accelerate. Target-date funds quietly swap stocks for bonds on a fixed glidepath. The relentless bid that Josh Brown described back in 2014, the steady river of 401(k) money that bought every dip without caring about the news, runs in reverse. Call it the relentless ask.

It’s a reasonable theory, but I believe it’s mostly wrong, at least as the reason this bull market ends.

Start with where the money sits. The top 10% of households own about 87% of all stocks. Wealth that concentrated doesn’t get spent down in retirement. It gets bequeathed. A retiree worth eight figures sells a sliver to fund their lifestyle and leaves the rest to compound, because they can’t spend it and don’t need to.

Then there’s longevity, which I believe is an important factor in determining the future of our economy. For a 65-year-old couple today, there’s a 64% chance at least one of them sees their 90s. Retirement now runs 30 years or more. You can’t fund three decades of inflation out of bonds, so Boomers have to keep owning stocks, and most of them will.

And someone is standing on the other side of the trade. There are roughly 73 million Millennials, a slightly larger cohort than the (living) Boomers, hitting their prime earning and saving years right as the Boomers start drawing down their savings. The single largest age group in America is now 33 to 37. They invest earlier and in greater numbers than Boomers did at the same age. The buyers are already here.

One more thing. Demographics are the most forecastable data in all of finance. We’ve known the Boomer cliff was coming for 50 years, and so does the market. Slow, telegraphed, decades-long tides don’t end bull markets. Surprises do.

Which is where the real risk lives, in my opinion. Brown’s word was relentless, not endless. He warned the bid “will suck in the maximum amount of people taking the largest amount of risk just at the point where it will come to an ignominious end.”

I believe the major risk to the equity markets sits somewhere other than a gentle 30-year drawdown.

It’s true that the automatic, price-agnostic flows that smoothed the bull market on the way up could prove just as automatic and just as price-agnostic on the way down, in a market where a handful of names seem to carry the whole thing. That’s the relentless bid’s dark twin, but that’s a forseeable risk and only part of the story.

So does the bull market end with the Boomers? I don’t think so. I think that it ends the way bull markets always end, when corporate earnings growth slows and valuations are stretched and not reflective of that slowdown.

Leaving arguments regarding passive versus active management aside, I believe that fundamentals matter more then flows, even generational ones.

Sources: Federal Reserve, Distributional Financial Accounts (net worth by generation); Ben Carlson, “What Happens to the Stock Market When Baby Boomers Sell?” and “Rich Old People”, A Wealth of Common Sense; Josh Brown, “The Relentless Bid, Explained” and “The Trouble with Relentless Bid Theories”, The Reformed Broker.

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