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Forest Fires

You can’t do Monte Carlo simulations on history because you don’t know the laws of evolution, so anything anyone says is simply unsubstantiated theory.

Nevertheless, here’s mine. The S&P 500 has now fallen from 1580 to the high 600s, down 57% and counting, despite intervention and cheerleading. If, instead, we’d let the market have its way with companies it didn’t like, more than a year ago, without government bailouts or interference or attempts to restore an unsustainable status quo, I am skeptical that we’d be much worse off now.

We would perhaps have had a fierce forest fire and now be looking at fresh growth on the forest floor. Instead, the flames keep finding fresh fuel.

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