The American Theater has been declared near death so many times that Broadway has been nicknamed “The Fabulous Invalid.” Now the same sort of attitude seems to be developing toward the stock market. Smart commentators no longer view equities as the automatic safe choice for the core of a long-term portfolio. And many individual investors seem to agree. They are yanking money out of the stock market at the fastest rate since May. But just as there has never been anything wrong with the Broadway Theater that a hit show wouldn’t fix, there’s nothing wrong with stocks that can’t be fixed by an economic recovery and a fresh bull market. Admittedly, there’s a lot to feel bad about nowadays – persistently high unemployment, devastated housing prices, and an economy growing at less than half the rate that’s normal following the end of a recession. Even worse, the stock market looks increasingly risky. The disastrous Facebook initial public offering burned many aggressive investors. And more recently, erratic computer trading has caused extraordinary short-term volatility in the prices of blue chips. So a somewhat downbeat outlook is understandable. Today’s pessimism comes in a number of different forms, however. In his column “Watch Out for a Correction – or Worse,”  Mark Hulbert argues that the stock market has rallied over the past few months and that sentiment among traders and newsletter writers is now overly enthusiastic. But that’s just a warning about a possible pullback, not a negative assessment of the long-term prospects for equities. (MORE: Was the Big Social Media IPO Boom a Scam?) The Wall Street Journal’s Jason Zweig is more concerned about the erratic price swings caused by faulty computer trading. Recent volatility creates the “sense of markets spinning out of control and trading machinery going mad,” Zweig writes. And he adds, “The hearts of many small investors have been broken by the serial setbacks of the past few years.” The most extreme view, however, may be that of Pimco’s Bill Gross, who compares today’s stock market to a Ponzi scheme. Corporate profits have been growing at the expense … Continue reading Is the Stock Market Really Dying?