Given that:
a) The financial wealth in the world is estimated to be about eight/nine times the real one and that
b) for four/five years, interest rates in the world have been close to zero and in various cases below zero
as do pension funds, hedge funds, sovereign wealth funds etc. to achieve quarter by quarter or year by year the minimum capital gains necessary to gratify their customers and win new ones?
The financial literature (more conformist than opportunistic) tries to explain the obvious, namely that the extravagant performance of the markets depends from time to time on the monetary policies of the central banks, on the prices of raw materials, on the state of the real economy , by the lack of reforms, by the quarterly and so on. But the financial literature is careful not to wonder why the impact of these factors (or drivers, what's more) now lasts less than 24 hours. And why the same factors are often used to explain both increases and decreases.
All the fault of volatility, they say. Yep, volatility. Which has become like Mary Poppins' umbrella or Merlin's magic powder. Not the consequence of something, as logic would have it, but the factor that determines others, as the poorest financial literature would have it.
Sometimes, it is true, someone breaks the pack and goes so far as to "discover" that it is algorithms and high-frequency trading that make the market today. But soon after we forget about it and we go back to thinking and writing as if we were still in the world of the stock exchanges with the shouts, in which the fundamentals of the economy and those of the individual listed companies moved the financial capital. An oversight behind which are, of course, the finance, consultancy and rating industries, regulators, newspapers, etc., i.e. tens of thousands of jobs, careers, generous salaries, stock options . Thus volatility has become the fig leaf and the line of the Piave of the corporations that cannot imagine their own future except as an extension of the existing one.
But since another future is always possible, I think it would be better to draw the consequences of the "structural" changes induced by globalization on the one hand and information technology on the other. Regulators could do a lot in this regard. For example, they could close the stock markets to non-professional traders. Perhaps by accentuating and making more effective supervision in markets where new technologies or information asymmetries matter less: government bonds, corporate bonds, deposit accounts, etc.
Utopia? Let's not go overboard with words. To me it would seem simply a maintenance of the existing so as not to get overwhelmed and overwhelmed by it.
