"Real investment-grade corporate bond yields are scarcely above zero. The Chicago Fed National Financial Conditions Index shows the liquidity backdrop is as loose as it's been this cycle...A clear majority of S&P 500 stocks have dividend yields exceeding the 10-year Treasury yield. While no perfect relative-value indicator, this tends to provide a buffer underneath equity valuation.
Let's be clear that noting the similar market set-up now is not remotely to predict anything like a repeat of the market collapse and economic calamity that began to unfold in late February of last year. The coronavirus spread was a genuine external shock, the forced global economic halt a first, the five-week-35% freefall unprecedented.
The flash recession and profit collapse prompted some $5 trillion in deficit-financed fiscal support with more likely, and turned the Fed maximum easy for a long time to come, intent on waiting for a return to full employment and a lasting rise in inflation before making any tightening moves.