I am so confused, I get the market and the economy are different

[progree]

19. The market did dive: the S&P 500 declined 33.9% from February 19 to March 23

But the Fed cut interest rates to zero and began virtually unlimited money creation and lending to corporations. Meanwhile deficit-tripling spending began. Enough to substantially boost personal income in Q2 2020 by 10.1% compared to Q2 2019 - far in excess of inflation and population growth. A very substantial real increase.

Details of the graph's and numbers' sources are in post#9



I borrowed this from at140 (Trasury?)


Result: market back up.

Despite a nose-dive in earnings:

Q1 S&P 500 Earnings per share:
2017 Q1: 27.46,
2018 Q1: 33.02,
2019 Q1: 35.02,
2020 Q1: 11.88 👀 😲
https://ycharts.com/indicators/sp_500_eps

We don't have the full Q2 earnings yet. But likely to be a lot worse, given that Q1 GDP declined by 5%, and Q2 GDP declined by 32.9% (both on an annualized rate basis. The actual GDP drops were Q1: 1.3%, Q2: 9.5%). So it would be pretty much impossible for Q2 earnings to be anything but a lot worse than Q1 earnings.

Ahh, if it were only sustainable. Ahh, if only chapter 3, where all the unsustainable stimulus is eventually and inevitably dialed back, proceeded as nicely as chapter 2 (the great-stimulus phase). Ahh, if only P/E ratios really didn't matter anymore.