Guest Post by John P. Hussman
On the first day of March 2017, the combined market capitalization of U.S. nonfinancial and financial stocks reached $34 trillion. Those trillions of dollars in paper wealth filter down to the investment statements of millions of investors, reflected in quotes on computer screens and blotches of ink on paper. Over the completion of the current market cycle, we estimate that roughly half of U.S. equity market capitalization – $17 trillion in paper wealth – will simply vanish. Nobody will “get” that wealth. It will simply disappear, like a game of musical chairs where players think they’ve won by finding chairs as the music stops, and suddenly feel them dissolving as if they had never existed in the first place.
Continue reading “Dissolving Musical Chairs”
