During the last century, it took a full 25 years (non-inflation numbers) before the stock market recovered from the declines it endured following the 1929 stock market crash and subsequent Great Depression. In fact, when the markets finally bottomed in July of 1932, a full 89% of equity value had been lost (transferred) out of the markets, and it would take until 1954 before the Dow achieved equilibrium to once again reach an all-time high.
And the reasons for this was that the U.S. economy functioned in a time where central bank and government interventions focused primarily on jobs, production, and the general economy, and did little or nothing for equity markets which were the playground of the rich. But when these same central banks began to change priorities and summarily neglect their original mandates to formulate different policies starting in the 1980's, the exact opposite started to occur and the results are now that stock markets function nearly 100% on the whims, funding, and policies of the central banks.
During perhaps the greatest natural expansion of the DOW market cap, which occurred between August of 1949 and April of 1966, one man was the primary head of the Federal Reserve and his fundamental policies were to focus solely on inflation, using statistics rather than models to provide intervention. And the Dow more than doubled in those 17 years not simply because of Fed funded stimulus or low interest rates, but because the economy as a whole had one of its greatest eras in American history following World War II.
Interestingly, when Fed Chairman Martin left the central bank in 1970, it would be less than a year before the Executive Branch of the U.S. government would seize back monetary control from the Federal Reserve and remove the currency from the gold standard. This of course led to a number of destructive outcomes for the general economy as a whole, and opened the door for a new form of monetary policy that would be based on credit expansion, and direct monetization.
As you can see by the above chart, direct monetization began around 1971, and started to accelerate under Ronald Reagan and a slew of Federal Reserve Chair's that were mirror images of one another in policy. And in the course of the last 30 years, we have had not one, not two, but three major market crashes (1987, 2001, 2008), far surpassing any slight downturns that took place in the 50 years between 1937 and 1987.
Following the 2008 crash, stock markets are now entirely under the control of central banks, and statistics are manufactured by the government to compliment the desired narrative. In fact, a new report out shows that 93%, or nearly all upward movement in equities following the 2009 bottom has been completely due to central bank intervention, and not from some economic recovery.
As Gordon Gekko stated in the movie Wall Street, greed is good, and thus the compliment to this which central banks have expanded in their policies is that even more greed must be even better.
When markets are allowed to function on their own merit, and in an environment of limited intervention, growth is almost always assured over the long run, and at steady rate which protects the public from inflation but still allows for innovation to spur markets at a time when an economy is in a decline. But when outside entities like a central bank or government intervene by killing the golden goose rather than being content with its daily production of singular golden eggs, the results are always both spectacular and catastrophic, with the real losers being the 99% who must endure the consequences of the choices made by a handful of people.