Quick Read
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SPDR S&P 500 ETF (SPY) returned 301% from January 2, 2014 through May 6, 2026, despite persistent bearish valuation calls citing elevated CAPE ratios and market cap to GDP ratios, as corporate profits surged 37% from $3,172.5B in Q1 2022 to $4,352.1B in Q4 2025.
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Bearish market forecasts often reflect the psychological makeup of strategists rather than fundamental economic data, as evidenced by Ray Dalio’s incorrect 1982 depression prediction at the start of a historic bull market and persistent doom calls during a decade-plus equity rally.
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The analyst who called NVIDIA in 2010 just named his top 10 stocks and SPDR S&P 500 ETF wasn’t one of them. Get them here FREE.
On Animal Spirits Podcast Episode 463, Michael Batnick zeroed in on something more revealing than the doom-laden statistics a hedge fund manager had just rolled out. The manager cited stock market cap to GDP at 252% versus 65% in 1929 and 170% in 2000, and warned that “the 10-year forward return is negative when you buy the S&P with a P/E of 22.” But Batnick honed in on a different admission: “My personality won’t allow me” to invest like Warren Buffett.
That single line explains more about bearish forecasting than any valuation chart.
The Dalio 1982 Anchor
Batnick’s comparison: Ray Dalio predicted a depression in 1982, at the start of “perhaps the greatest bull market of all time.” Dalio built one of the most successful hedge funds in history. The depression call did not stop him, because the call was never the point. “certain personality types are more well-suited for certain types of investment disciplines,” and bearish calls are often “all personality-driven.”
The analyst who called NVIDIA in 2010 just named his top 10 stocks and SPDR S&P 500 ETF wasn’t one of them. Get them here FREE.
When a perma-bear hands you a thesis, you are reading their psychological profile as much as their spreadsheet.
The Numbers Bears Are Citing Aren’t Wrong
Co-host Ben Carlson conceded the market “is obviously not cheap.” The data backs that up. The 10-year Treasury yield sits at 4%, in the 88th percentile of the past year’s range, which mathematically compresses the multiples investors will pay. University of Michigan consumer sentiment is at 53.3, deep in pessimistic territory and in the 27th percentile historically. Real GDP grew just 2% in Q1 2026 after a 1% Q4 2025 report.
Yet the SPDR S&P 500 ETF (NYSEARCA:SPY) is up 31% over the past year and 257% over the past 10 years. Since the CAPE-ratio debate began heating up in 2014-2015, SPY has returned 301% from January 2, 2014 through May 6, 2026. A decade-plus of bearish valuation calls have coincided with one of the strongest equity runs in modern history.