Great Graphic: Demographics and Stocks

This Great Graphic comes from Joshua M Brown's Reformed Broker Blog. He says he got it from David Wilson who got it from Citi. 

On a log scale, it plots the S&P 500 and the number of Americans aged 35-39 at mid-year.  The implication is clear.  The size of this cohort is projected to increase over the next 17 years as a result of those that were born in the 1980s and 1990s come of age.  Their savings will help fuel a new secular bull market in stocks.  

Color me a bit skeptical.  First, such arguments, even if valid, should not dissuade investors from doing their home work and fundamental analysis.  Second, demographic and other structural arguments for underlying market moves, down plays the volatility.  Such arguments, then even if valid, should not dissuade investors from disciplined money management practices.   Third, such arguments assume that the next generation of investors will do what the past generation has done with its savings.  This seem to ignore that a) most Americans do not have a significant amount of stocks and those that do is primarily through 401k schemes and b) the stock market (S&P 500) is generally flat since 2000, c) the level of debt, including student loans, may delay the accumulation phase in the life-cycle approaches.