In 2015, nearly every asset class failed to provide returns. The S&P 500 has flatlined for the past 400 days, with hundreds of stocks well off their 2015 highs. The 30-year Treasury bond has fallen over 2.0 percent, cash in money market accounts have returned just +0.11 percent (so after taxes and inflation your return was solidly negative), and the CRB index is down nearly 25 percent. So what should investors do with their money when nothing is working?
First, let me briefly explain why nothing has worked for so long. The global economy has become debt disabled and market prices have been massively distorted by governments and central banks. The free market has been eviscerated and supplanted by money printing and deficit spending on an unprecedented scale. The bottom line is that there is now a historic and humongous gap between stock prices and economic fundamentals. And a gigantic gap between fixed income yields in relation to the underlying credit quality.