At this stage in the cycle, perceived risk is very low, expected returns are very high (some of the stuff you read on this is next-level crazy, ppl saying they are guaranteed a double digit real return from equities), and so no-one wants to hold cash...any cash. They hold very low levels of cash relative to total assets.
At some point, this will change. Cash % of assets is basically stationary (to some extent, the mean % has probably trended down this decade slightly though). Large-scale fraud will lead to a re-examination of the relative reward of assets, actual losses mean that your ratio of cash to assets drops, and people sell to either increase liquidity/panic/etc.
Bubbles sometimes deflate slowly, most often they do not because people aren't rational. If you buy into a stock expecting to sell it someone else at a greater price, what do you do if you wake up one morning and it is down 20%? You get out. There is no reason to hold it. You can't earn fundamental value at that price. This is happening in multiple stocks, margin calls, brokers start liquidating client portfolios en masse...you get the picture.
Ymmv, if you have a good adviser then great. But I used to work in this area, and even in my first real job (not my first job in the industry though) the level of ignorance was brutally obvious.
For example, my first employer was a single adviser firm that just got acquired for $5m...this guy didn't know how to use Excel, he didn't know how to build a financial forecast, he didn't understand that life expectancy at birth was different to expectancy at retirement, he didn't understand basic elements of finance (for example, why you can't make money buying a stock and selling after they pay a dividend), he didn't understand how to compute returns, and falsified those numbers in marketing when they showed bad performance...and this is a guy who has hundreds of clients, and $100m+ in assets. However bad you think it is, it is much much worse.
Most of the people on here will do better if they apply a little time, and understand that human reasoning is flawed (i.e. don't get swept in the hot new thing). That is all that is required.
A return to March 2020 would be a loss of close to 50%.
Previous peak to present might be a less misleading factoid. And that is +20%. Still a big number but less impressive. It may be that confidence in public markets was bolstered by the resilience of the big companies' profits in the face of the virus.
Ok you want a longer period? it’s up nearly 70% from start of 2019, and it’s PE ratio is among the highest in its history.
For what it's worth, a look at the annualized returns chart for the S&P500 might be interesting. https://www.macrotrends.net/2526/sp-500-historical-annual-re... Those green bars on the right don't look tremendously out of place compared to past years. What's really different from previous decades is not the rate of growth but the lack of financial market downturns. Hard to say if that means we're ramping up to "the big one" or if we have fundamentally figured out how to better run the economy so that we have fewer downturns.