The Longevity Dividend and the Economic Burden of Chronic Disease

According to the Milken Institute, “It’s been estimated that $2.6 T was added to the U.S. every year, just due to the extension of life in the past century. Solving cancer today is worth $46.5 T to the U.S., and adds $125 T to the world economy” (queue up the 53:30 minute mark).

The way I presently see it, the flip side of the Longevity Dividend, is the Mortality Tariff. As a society, we pay huge unrecoverable costs as a penalty for living short, disease-ravaged, frail lives. Counter to conventional so-called wisdom that might view super longevity as some kind of starry-eyed whimsical pursuit, I would argue that the costs of mortality to society are so high that inaction to contain these costs is fiscally irresponsible. Of course, in recent years one of the most active and articulate champions for the cause of putting realistic costs upon the impacts of aging is Dr. Aubrey de Grey.

Having recently acquired a bit more clarity on the subject of SENS, thanks to his book Ending Aging: The Rejuvenation Breakthroughs That Could Reverse Human Aging in Our Lifetime, my ears immediately perked up when I heard Michael Milkin on Bloomberg TV today, talking about a minimum of USD $46.5 T (yes, trillion) economic opportunity for achieving longer, healthier lives.

What??? Someone on the semi mainstream financial networks talking about longevity dividends? I can’t quite call Bloomberg TV fully mainstream, but it is certainly mainstream enough among the relatively educated demographic of active investors who pay attention to this new source. So I consider this as a very exciting development.

I was happily taken aback to hear someone of Mr. Milkin’s stature putting a ballpark price tag on the Longevity Dividend, albeit through the lens of costs incurred by chronic disease; costs that are massively amplified by the unmitigated process of aging.

Of course, the mainstream media would likely do all they can to say, “this is the last guy you should ever listen to, look what he did 50 years ago!” Well, that was 50 years ago (or whatever), and this is now. People change. This is another key benefit of living radically longer lives … people gain even more opportunities to accrue instructive experiences, to learn, change, and grow – to become Better Humans. Nevertheless, we must be practical when considering the interplay of contemporary media and fearful human nature; Mr. Milkin is probably not the best poster child for pursuing the Longevity Dividend, but he’s definitely a valuable resource for the financial think tank.

Mr. Milkin is an extraordinarily smart guy, which arguably may have led to his former troubles in the first place. However, he’s long since marched to beat of a far better behaved drummer and while he didn’t explicitly use the Longevity Dividend terminology, he clearly made the case that the single most effective way to leverage U.S. and global market productivity is to make immediate direct investment in achieving LONGER and HEALTHIER lives. This strikes me as a Very Good Thing(tm) for SENS in general.

Moreover, it prompted the following idea: a SENS specific ETF. Exchange Traded Funds (ETF’s) are increasingly popular “baskets” of securities, which focus upon various market segments while distributing risk among the basket’s constituent components. ETF’s differ from Mutual Funds in ways too minute to detail here. However, if you wanted to invest in “emerging markets” using an ETF, you might select NYSE ticker EEM, the iShares MSCI Emerging Markets Index.

Could investors work with Dr. de Grey to identify a basket of companies to trade under a SENS ETF and thereby create a vehicle for direct investment in the companies that are working within any or all of the Seven specific SENS? (As a curious aside, the NYSE ticker SENS is either orphaned by Sentex Sensing Technology Inc., or already belongs to CardioMEMS Inc. if you believe Barron’s.) No matter. It would be nice to get the perfectly branded ticker, but hardly a deal breaker. The important thing is identifying the right companies and directing resources to solve the Seven Deadly Things.

For more information, listen to the Milken Institute presentation addressing current global challenges was given at an investors conference in London on Jan 18, 2007. Even nine months later, it is still worth incorporating into the overall lifeboat calculus. Better yet, for those of us in based in or around California, the 2007 California State of the State conference in Beverly Hills will be held on October 29. Still plenty of time to register and attend for the discount rate of $450, prior to October 5. (Government, academic and nonprofit institutions get in for $395)

Listen at Bloomberg: Finance as Solution to Global Problems to catch up on the “news” that today’s children can expect AVERAGE life expectancy of 110. You’ll also learn precisely why 80 is the new 60; 60 the new 40, etc.