Since the end of World War II, whenever a Cassandra has warned those who were optimistic, “beware, this time is different,” he or she has ultimately been proven wrong. The on-going growth of the American economy would eventually/inevitably bring logic to the investment process, albeit sometimes after protracted distortions in equity valuations.  And “life as we know it” went on, not to worry.

However, if 2016 does not present a truly different set of parameters, I must be missing something. Below is what undoubtedly constitutes only a partial list of “differences.” There is no attempt to prioritize.

*In the year to June 30, 2015, slightly more non-white babies were born in the United States than white. Demographic projections anyone!

*Not only is financial inequality at levels of nearly a century ago, but the middle class – historically the engine of American economic growth – is being crushed.

*As a high school student over a half-century ago, the conceptualization of the world (i.e. importance in understanding) was seemingly the USA, 70%; Western Europe, 20%, and the rest of the world, shorthanded to ROW, a mere 10%. Now virtually all the real economic growth is in ROW.

*The Federal Reserve is de facto being charged with the responsibility of using monetary policy to spur economic growth. The Fed has pumped out funds like there was no tomorrow (maybe there won’t be) and as if the age-old connection of excess money creation with inflation had been repealed.

*Developed countries are selling debt with negative interest rates. Huh!

*America’s racial divide shows no signs of being healed (whoops, that is not a “difference”), and racism/anti-immigrant sentiment is rising in the same Western European countries which prided themselves on inclusion.

*The American presidential campaign! Never seen one like it.

*Suicide rates are rising domestically for every cohort except geezers like the writer, where the rate was already higher than elsewhere.

*The environment is being destroyed; ho hum, that’s a subject for the future. Agreements now, maybe implementation later.

*The statistical combination of unemployment (not employment), inflation, dissatisfaction levels, bond yields and monetary expansion is unprecedented.

*We produce record levels of food, much of it in a cruel fashion, and an absurd amount is wasted. 

*There are now more non-religion adherents than those enrolled in a religion.  Correction, there is a religion which unites all Americans: consumerism.

*The daily violence worldwide defies easy analysis and understanding, making one – bad joke coming — yearn — for the old days of good guys (Americans) versus bad guys (the Commies).  As for gun control, forgettaboutit; alas, another non-difference.

*On the foreign front (as if it were truly separate from domestic issues),

• Great Britain inexplicably decides it does not want to be in an economic combine where it had its cake (trade and its role as a financial center) and could eat it too (have its own currency).
• Russia’s well-known disregard of world opinion is again exemplified in its doping scandal, the latest chapter actually (the last non-difference).
• China’s growth rate has gone from astronomical to only good faster than its state-controlled accountants can manufacture the numbers.
• In five years, Istanbul goes from a city I recommended to everybody to one which is a center of chaos.
• In an even shorter period of time, Brazil transitions from the golden country of South America – continuous high growth plus big sporting events on the calendar – to one characterized by political, economic, and physical sickness.

Nitpickers undoubtedly can point to a few items above which might be characterized as cyclical and not indicative of structural change. More interesting though is that different critics would select different entries, which proves the point: the preponderance of evidence is that this time is different.

What does all this mean for an equity investor? Damned if I know. Right now, the United States is “the best house in a bad neighborhood.” Elasticity of price-earnings ratios historically has proven to have few definable limits, even when the starting point for valuations is a relatively high level, as is true today.

Full disclosure: I have an equity exposure of 40%, almost entirely in high grade, globally important companies. If and when people equate “this time (really) is different” with a bubble-bursting hit to the stock market of 25%, the level of pain should be tolerable.  I think.