The stock market has devolved. Make no mistake, it is broken.

Its primary purpose had always been to facilitate capital formation. Companies that needed funds have always looked to the equity markets to issue stock. The funds they raise via an initial public offering, or IPO, are put to work to generate earnings. The increased earnings drive the share price of their stocks higher, and investors and savers accumulate wealth. That increased wealth, in addition to their wages, drives consumers to spend and buy. And that spending and buying in turn drives demand for corporate goods and services, which in turn drives additional corporate profits, and the cycle continues.

The stock market is the mechanism where IPOs trade among secondary ...

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