NZX at a five year low

So the New Zealand stock exchange is at its lowest level in five years.  So what’s going on?

1. Has the market been over-valued this whole time?
2. Has the value of our capital (the implied future earnings of that capital) really fallen levels unseen in five years?
3. Is the market over-reacting?
4. Or finally, is the NZX-50 just massively unrepresentative of the actual performance of New Zealand capital?

However, to put our fall in perspective, the US S&P has just hit a 12 year low – and that is a much broader index.  I find it hard to believe that the value of capital in the US is down to its 1997 level …