With a year as dismal as 2022, it’s natural to want to assign blame: inflation, the Fed, war, etc. The best and simplest answer may also be the least dramatic and fulfilling – markets fell a lot because they went up too much in the first place.

While it’s been forty years, we have seen this movie before. No one knows whether we are in the early, middle, or late innings of this inflation story. What we do know is that the Fed is enacting a cure that has been effective. Like last time, investors must endure pain while we wait for the cure to work.