Day: January 31, 2023

We are closing in on what we think may be the question of the decade. If a majority of stock market capitalization in the US is passive or indexed, does this cause problems for stock markets? Bloomberg columnist John Authers addressed this conundrum by saying, “Logic dictates that not all assets could be run passively. If that were to happen, the market would stop functioning and cease to have any use in pricing and allocating capital.” We disagree with the ceasing to function. Markets were made by God to clear, but one question remains: at what price? […]