Hickey and Walters (Bespoke) submit: Monday's New York Times had an editorial which described the current crisis in the credit markets. What we found interesting about the editorial was the final paragraph:
Whatever happens now, it's hard to avoid the sense that the growing complexity of our financial system is making it increasingly prone to crises- crises that are beyond the ability of traditional policies to handle. Maybe we'll make it through the crisis unscathed. But what about the next one, or the one after that?
Are the current financial markets really more prone to financial crises than they have been in the past? If we remember correctly, the recent S&P 500 decline is the first 10% correction in over four years, and was the second longest stretch since 1940 where the market did not have a 10% correction.