Something’s Gone Horribly Awry

Marginal Activities

The S&P 500 has fallen 7.37 percent so far this year. What to make of it? Naturally, some people find falling stock prices to be unpleasant. Others find them distressing. Another way to look at falling stock prices, however, is like a high-fiber diet. The effect is necessary to a healthy functioning system.
The simple fact is that stock prices, fueled by speculative liquidity, have long since outrun the real economy. The disconnect between the two has been widely observable. The economy’s lagged, incomes have stagnated, yet stocks have soared.

This post was published at Acting-Man on January 31, 2016.

 

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