Things Fall Apart (Part 2)

For a decade, every strategy that was supposed to work didn't. Diversification failed. Value failed. Trend failed. Everything underperformed one thing: the S&P 500. This wasn't supposed to happen, and the failure reveals something troubling about what's actually driving our markets and our wealth.

•        The math worked for 46 years, then stopped working in 1997. From 1951 to 1997, household wealth grew in lockstep with the economy. Since then we've been richer than we grow, creating bubbles. That gap is the problem.

•        Central banks stopped protecting markets and started using them as political tools. What began as emergency rescue after 2008 became permanent policy: buy ALL financial assets, inflate ALL prices, regardless of whether those assets deserve it.

•        Wealth concentration exploded because of how those bubbles were distributed. Financial assets flow to the rich. Inflate stock and bond prices and the top 0.1% gets richer while the bottom 90% stagnates or falls behind.

•        Young people were paid off with debt instead of wealth. Student loans and easy credit let younger Americans feel rich while actually becoming poorer. They're living in a collegiate bubble that's as artificial as anything in markets.

•        Every major "asset class" you own is actually the same thing. Emerging Markets isn't separate. Real Assets isn't separate. They're all shadows of central bank policy. The diversification you thought protected you never actually existed.