It’s easy to forget how short the market’s memory is.

Still remember the last few months of 2022. The S&P 500 was down nearly 25%, the Nasdaq had crashed over 35%, and inflation was out of control. The Fed was hiking rates aggressively, and it felt like a deep recession was inevitable.

Goldman Sachs or JP Morgan (don't remember which) predicted the S&P 500 would go all the way to 3,000. Michael Burry suggested an even bigger collapse taking S&P500 back to 1800. Most investors were convinced this was just the beginning of more pain. Even then people talked about stagflation and going into the lost decade.

Meta, in particular, was the poster child of despair. Down 75%, from $380 to $88. People genuinely thought it would never recover. The ad market was dying. Reels weren’t making money. Zuckerberg was "burning billions" on the metaverse. Investors wanted him to shut it all down.

It wasn’t just Meta. Amazon reported its first unprofitable year after a long time. Google’s ad revenue shrank. Microsoft’s growth slowed. Tesla was down to $113 at its lowest. Institutions were slashing price targets left and right. Investors were selling at the lows, convinced things would only get worse.

And then... the market did what it always does. Slowly, things started improving. Companies adapted. Earnings stabilized. The panic faded. By mid-2023, inflation was cooling. The Fed hinted at pausing rate hikes.

Meta posted a solid earnings report. Then came $40 billion in stock buybacks. The stock doubled. Then doubled again. Amazon recovered. Nvidia went on a historic run. The Nasdaq had its best year in two decades in 2023. By early 2024, Meta, Nvidia, and Microsoft were hitting all-time highs to reach even higher by end of 2024. Two years of record gains.

When markets are crashing, it feels like they’ll never go up again. When they’re at all-time highs, it feels like they’ll never go down. Neither is true.

So investors, it's going to be fine. Just be calm and hold tight. And if you can, keep buying.

The resilience of the current price of equities/S&P 500 index, when compared to the price movement and market sentiment in 2022 seems quite surprising.

We had a crash in 2022, mainly in Tech companies. In hindsight, it was considered to be mainly caused by interest rate rises, lay-offs in the tech sector, Big Tech Antitrust Investigations in the USA, Europe and, I think even in China (Jack Ma becoming absent from public view for a little while).

Yet, between Jan 2022 (Shiller CAPE just under 37) and Oct 2022 (Shiller CAPE around 27) the S&P500 fell by 23% or so (Meta fell by around 70%, and was a bargain), and even Berkshire fell by around 16% or similar (to demonstrate that the price drop was wide spread and even reached 'non-tech' companies). So you can see from this picture, that the rationale for the pessimism was very concentrated, and not wide spread across various areas of the local or global economies, even though the price drops were.

Looking back at that, even when experiencing it at the time, IMO nothing had fundamentally changed; the Tech companies' products would still be used by billions of people (even if they were broken up), they were still going to generate revenues and profits, have high margins and there was no real recession or fears of one that I can remember. No concerns about the government, or the SEC or any other core organisation. No issues with reduction in consumer demand etc. So, overall, it was just this one tech related issue (as perceived by market participants, maybe a little bit of interest rates thrown in), and yet, the market shed 23% in 10 months or so.

On the other hand, the concerns that people seem to be having now are numerous, varied, disparate and fundamental.

Things people have talked about with regards to the USA now, most, not all, of which were not remotely concerning in 2022:

1. Market is priced quite high, maybe overvalued - S&P 500 Shiller CAPE of just under 38 in Jan 2025, and currently probably around 33. 60% of the global stock market cap as presented by MSCI? vs 25% or so of Global GDP. For context, historical average of CAPE ratio is around 17.

2. It took 7 months for the S&P 500 to drop 19% in 2022, in 2025 it did that under 2 months (before recovering some), so that is a much sharper fall than in 2022.

3. Concerns about Tariffs and Trade wars and its impact on consumer spending.

4. Effect of the above on inflation, which was just about to be gotten under control.

5. Businesses cooling off from investments due to the chaotic and unpredictable environment.

6. Unemployment at historical lows in USA, that means Fed might be limited in what they can do with lowering rates.

7. Spooked bond market and rising yields due to US Govt Debt sell off.

8. Concerns about insider trading and/or market manipulation by the administration and those who are close to it.

9. Concerns about the competency of the current US administration (handling of Signal Chat leaks, Peter Navarro qualifications or lack thereof and the bizarre Tariff formula, $Trump and $Melania kript0 pump and dump, DOGE handling or lay-offs, among many other things).

10. American reputation and brand deterioration amongst its close allies and trading partners.

11. Concerns about whether laws are being applied with as much integrity as they used to be and equally for the rich and the average person, resident citizens vs those on Visas etc.

There may be other things which I may have missed. (I haven't mentioned the many 'little issues', like Gabbard declaring her residency in Texas and voting in Hawaii etc. etc.)

So, it appears that there are far more, wide ranging, diverse, and fundamental reasons to be concerned and pessimistic now about the future and market prices, than there were in 2022, and yet the market seems more optimistic than it should be, based purely on how much it has dropped when compared to 2022, at least until now.

Is that a fair take?

Should there be more pessimism as expressed in the price drops of equity markets, than has occurred thus far? Perhaps there is pessimism in the mainstream discourse but it doesn't appear to be reflected in the market prices to the same degree.