everything i have said so far could apply to the graduates this year of any college or university. the rest of what i have to say is about you, the 2016 graduates of the for example, see oreopoulos and petronijevic ( 2013 ) and bound and turner ( 2011 ). - 5university of baltimore. i have learned a bit about you recently, with the help of the university ’ s staff. let me tell you a few things about some of your classmates that you may not know. among you today is a full - time student who found the time each semester to volunteer with non - profit organizations, including one that helps refugees from other countries find their place in this community. another of your fellow students, who used to doubt that she could ever afford college, has become a student leader. she made the dean ’ s list every semester after transferring from community college. like many of you, another of your fellow graduates took day and evening classes to balance work and family demands. she was forced to change jobs to accommodate this schedule. she later decided her future lay in digital communications, which required her to switch majors after taking some required classes. today she will become the first person in her family to graduate from college. some of you were born in other countries. one of you lived in four other countries before coming to the university of baltimore for a master ’ s degree. many of you have contributed to the sense of community at the university of baltimore by actively participating in student life. one of you has even decided to seek a career helping other students as a student affairs professional. these are a few of the outstanding people who will join you in walking across this stage today. let me describe one more. to that student, sitting in the audience, i would say : you deserve a tremendous amount of credit. based on what i have learned, you did not have all of the advantages that can pave the way to college and graduate school. you overcame obstacles to make it - 6here, and more obstacles to complete your degree. one of the biggest of these obstacles, in fact, was that some people doubted you could or would succeed. but others in your life believed in you. some of them are here today. they believed in you, and you believed in yourself, and your talent and intelligence and hard work enabled you to earn the degree you are about to receive. if this sounds like you, then you are absolutely right, because i am not describing

the united states. in 2050, for example, the number of retirees for each 100 working - age people in the united states should be about the same as in 2030, about 34, but the number of retirees per 100 working - age people is projected to increase to about 60 in the euro area and about 78 in japan. we see that many of the major industrial countries - particularly japan and some countries in western europe - have both strong reasons to save ( to help support future retirees ) and increasingly limited investment opportunities at home ( because workforces are shrinking and capital - labor ratios are already high ). in contrast, most developing countries have younger and more - rapidly growing workforces, as well as relatively low ratios of capital to labor, conditions that imply that the returns to capital in those countries may potentially be quite high. basic economic logic thus suggests that, in the longer term, the industrial countries as a group should be running current account surpluses and lending on net to the developing world, not the other way around. if financial capital were to flow in this " natural " direction, savers in the industrial countries would potentially earn higher returns and enjoy increased diversification, and borrowers in the developing world would have the funds to make the these data are from annex table 58, oecd economic outlook, vol. 76, 2004, p. 226. the latest year for which data are available is 2003 for germany and the united kingdom, 2002 for france, italy, and japan. china is an important exception to the generalization that developing countries have young populations. the country's fertility rate has declined since the 1970s, and its elderly dependency ratio is expected to exceed that of the united states by midcentury. capital investments needed to promote growth and higher living standards. of course, to ensure that capital flows to developing countries yield these benefits, the developing countries would need to make further progress toward improving conditions for investment, as i will discuss further in a bit. a second issue concerns the uses of international credit in the united states and other industrial countries with external deficits. because investment by businesses in equipment and structures has been relatively low in recent years ( for cyclical and other reasons ) and because the tax and financial systems in the united states and many other countries are designed to promote homeownership, much of the recent capital inflow into the developed world has shown up in higher rates of home construction and in higher home prices. higher home prices in turn