The author notices the divergence, but he doesn't seem to notice that a new pattern has emerged. Forty years of smooth increase has morphed into to something like a roller coaster. He looks past these chronic spasms to see a secular shift -- "continued exponential growth of household net worth." It turns our that wealth _can_ durably outstrip savings! He doesn't wonder whether another steep (perhaps steeper) plunge of asset values might be in store.[1]

There's nothing mysterious here. For a century it has been well understood how artificial credit expansion inflates asset bubbles causing the boom/bust cycle.[2] Only the intellectual progeny of Keynes continue to find it mysterious and feel compelled to invent exotic new explanations for such "paradoxes."

Why ever would we be surprised at inflating asset prices when it's been Fed policy for a long time. In the words of Bernanke, "...higher stock prices will boost consumer wealth and help increase confidence, which can also spur spending."[3] In other words, new paper wealth makes consumers feel richer so they'll stop that harmful saving.[4]

[1] He notes, "The valuation jumps up and down as asset markets re-evaluate what all those real assets are worth." but without wondering why they only started "jumping up and down" in 1999.

[2] https://en.wikipedia.org/wiki/Austrian_business_cycle_theory

[3] http://www.marketwatch.com/story/bernanke-defends-qe-talks-w...

[4] https://mises.org/library/hayek-paradox-saving