its too complicated to explain, and i am completely shook by these losses. but there is a growing theory that there is a relationship between government debt/spending and asset prices. the last few years, up to 25% of total USA employment is indirectly from the government. the last 25 years has been a hallowing out of actual economy, replaced with debt, financial engineering, low interest rates, and the like. the growth is mostly fake, which is the why the middle class is almost gone and no one can afford anything
I agree with you on the plague of financialization. Just not that it’s driven by government debt. My take is that it’s caused by growing inequality and trickle-up redistribution of money from those who don’t have enough to spend to those who already have too much and thus will save/invest rather than spending.
In the type of consumer economy I saw "recover" after the Nixon Recession did its permanent damage, it became possible for the Feds to juice the economy more than ever (after stability was finally achieved), by adjusting interest rates and increasing spending in the right areas it would be amplified and they effectively gained more and more control of overall prosperity, more than any other one entity.
This couldn't have happened earlier until the wealth held by the government was beyond a certain ratio to that held by the combined population. In simplest terms disregarding important things like liquidity or absolute net worth. It wouldn't have been so bad except people got a lot poorer and vast opportunities were lost forever in a few short years. Government money had a much stronger seeding effect after that which was then relied on heavily ever since, but gradually squeezing the whole time.
Biden unleashed a bit of this and it still worked to some degree, just not enough people ended up feeling more prosperous before it was too late. Really helps the economy most if the ultimate beneficiaries are ordinary working people and are widely dispersed, but a lot of it does not come back to the Treasury and builds up as debt.
In a less-stable environment, increased government spending is less likely to hit its intended target, plus a great abundance of consumers have been tapped out and don't have the resources to amplify it and collectively bail out anything this time, which was the leverage that worked in the past.
