Hello Yves,

Thank you for sharing your viewpoint on the issue. I would appreciate hearing more of the details of your thoughts.

While I think that supply and demand is a useful mental model, I also think that when applied simplistically the outcomes become less descriptive. Here I am referring to the fact that demand for stocks is fairly easily had: I have 40 euro and I want a share, therefore I open an account and place a buy order. Whereas, to supply stocks to the marketplace incurs massively disproportionate costs on the supplier, relative to those that would demand the same stock. Given that there are such asymmetric costs at play I think any rich analysis using supply and demand has to factor in the benefits vs. costs of supplying stocks. Given the declining supply, I think one would have to conclude that the costs, relative to the benefits, must be on the rise. Or, put in the most affirmative way possible, the acceleration in the benefits of supplying stocks is not keeping pace with the acceleration in the costs of supplying stocks.

With smiles,

Jason