After all, capital markets are mostly in the business of trading in bonds and equities that have been issued in the past. The actual financing or allocation of new capital represents only a fraction of the daily turnover of capital markets. Indeed, from the point of view of allocating capital across productive purposes the secondary market is not of direct relevance.
And as you know, in most financial systems there has been a phase in which markets have been more or less non-existent and financing has taken place through intermediaries, banks. However, deep and liquid secondary markets play a very important indirect role for financing in capital markets. First of all, well functioning secondary markets provide transparent market prices for capital market financing.