The sky could fall tomorrow (or Monday), we really don't know. Russia could make a move that signal a foreseeable war end or escalation. China could decide it does not need the US. The Chinese domestic market at some point will be much much bigger than the US, and Europe and the US both want to be the top dog, so cooperation is not as good as it could be.
If the interest rate is negative or 2%, if inflation is running a 6-7%, I am still paying someone to hold my money in either case. Similarly 3.4% sounds strong, but in a 6-7% inflation scenario, that is stagflation.
@ghdprentice my point was someone made a comment about living in Japan (or Asia in general where inflation was lower). My comment was there are lots of places in Asia live and be happy, China not being one of those places though.
Back to the market, 30K in Nov, 32.9 in now, 6 months at 7%+ inflation is a 3.5% devaluation. Not much, considering a war is going on.
My concern with valuations is where the near term growth is going to come from to support the forward predicted valuations. Longer term it may be there as India modernizes and drives global growth, but otherwise, there is not the driver that China has been of world consumption coming online.
The fact that the world economy didnt come to a screeching halt in mid-2020 is clear evidence that the monetary policy worked.
It is evidence that an aspect of the fiscal policy worked. That does not mean the fiscal policy was ideal or even close to ideal. Just the fact that we had a massive asset valuation increase during a global pandemic should give you pause. Literally no value was being created, but assets grew i value. Throw your economic theories and monetary policy aside for a while. That is fundamentally flawed, and anything that fundamentally flawed will eventually crash.