Another laissez faire mechanism?
- The majority of people believe that the equity market, not being volatile, will be fairly stagnant in the medium term.
- The majority of people believe that tBonds are worthless because their stagnant return is still below the equity markets stagnant return.
- The current business environment is not lending itself to new technology that will give any one business a competitive advantage thus creating high return rates.
Because of these points people rather invest in new firms that want to try industry changing technology. Even though these companies have higher risk, the technology they are developing is economy changing such as the steel industry was in times past.