Yes, the Stock Market Just Went Into Free Fall—It’s Not the Metric You Should Worry About.

DOW closes down more than 1100 points, New York, Usa - 05 Feb 2018 (Credit: Justin Lane—EPA-EFE/REX/Shutterstock)

Yesterday’s historic stock sell-off had many people wondering if the great bull market had at long last sputtered to an end. Over the past (nearly) nine years, the S&P 500 stock index rose some 325% from its bottom (March 9, 2009) to its top (January 26, 2018)—before beginning its recent heart-pounding swoon. Then came the free fall—a collapse that sucked out 8.6% of the broad market’s value in a 10-day gasp (as of the writing of this note). I have yet to find a really good stock index for the pubic companies leading the digital health revolution, but for comparison’s sake, my ever-resourceful colleague Scott DeCarlo alit upon the S&P 1500 Supercomposite Health Care Technology Index—which includes an assortment of medtech companies valued between $400 million and $21 billion—and which dropped 8.5% over the same period. That suggests the carnage hit healthcare just as it did most everything else.

So is this the end? Well, from a technical standpoint, we still have a ways to go before this bear turn qualifies as a “correction.” But the broader question in my mind is, Are we measuring the right bull to begin with? I would argue that the horned creature that matters most is the investment bull—no, not the public’s piling money (often without much thought) into corporate stocks, but rather the companies themselves investing in their own