User:Jimfrankbc/sandbox

TREND BREAK
Two decades ago, the notion of shoppers from China, or any emerging market, driving economic activity in Street—or anywhere else—would have seemed preposterous. For centuries, less than 1 percent of the world’s population enjoyed sufficient income to spend it on anything beyond basic daily needs. As recently as 1990, 43 percent of the population in the developing world lived in extreme poverty, earning less than $1.25 per day, and only one in five people on the planet earned more than $10 a day—the level of income at which households reach the “consuming class” threshold and can afford to buy discretionary items.9 The vast majority of those consumers were in advanced economies in North America, Western Europe, and Japan. Over the past two decades, the amplifying forces of industrialization, technology, and the urbanization of emerging economies have driven incomes higher for billions of people, lifting 700 million out of poverty and adding 1.2 billion new members to the consuming class.10 From a societal perspective, this level of poverty eradication prevents more deaths from poverty-related diseases and hunger than the lives saved per year through eradication of smallpox, often hailed as the greatest health-care achievement of the twentieth century.11 From a market perspective, it means the center of the global consuming class, with huge spending power, is shifting east and south. By 2025, we expect the consumer class to add another 1.8 billion people and total 4.2 billion. Much has been made about the world’s population crossing the 7 billion threshold in 2012. But the 3 billion additional members of the world’s consuming class added in just thirty-five years is a far more significant milestone.12 That’s as many new consumers added as there were people on the planet in the mid-1960s.13 As Sanjeev Sanyal, Deutsche Bank’s global strategist, notes, “The real story for the next two decades will be emerging economies’ shift to middle-class status. Although other emerging regions will undergo a similar shift, Asia will dominate this transformation.”14