Normalizing Crazy

"Crazy is on the bus."
 --Danny Roman (The Negotiator)

Interesting point raised last Friday by Fleck. He believes that the best analog to the current stock market situation is Japan in the 1980s prior to its epic bust. In particular he feels that there is a parallel in the extreme investor confidence that accumulates when huge and prolonged deviation from norms becomes status quo.

"When something crazy lasts longer than anyone would think possible--and that could be a few months or many years--the duration can somehow sanction in people's minds whatever is happening, as if the length of time somehow adjudicated the ultimate outcome of the policies or the environment."

Stated differently, the longer craziness persists, the less crazy and the more normal it seems.

Meanwhile, the Nikkei remains well below its all time high of nearly 30 years ago.