Today’s stock market has given investors three lives over the last two decades. These lives have been born out of extraordinary policy actions intended to beckon investors toward the dream that all is well and good when in fact it is not. But just like any creature that is given multiple lives, each reincarnation brings about greater distortions from what was once reality. It also places increasing strains on those that are charged with overseeing the economy and markets to keep the corpse alive. We are now well along in our third life for capital markets, and with its next demise it is likely that policy makers will be forced to finally lay this body to rest and let the cleansing process wash over us. Such would be a most positive development, however, for with death comes a much more sustainability and healthy rebirth as a fresh market form is born anew. And for those with a plan, such a transformation offers great opportunity along the way.
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