This sounds very rational but it is mostly wrong.
Stock market like many other assets are driven mostly by credit cycles. Bubbles are created by natural credit cycles. The vast majority of money in the USA isn't hard cash, its credit. And low interest rates and other things can rapidly expand the amount of credit. We are in a period of extremely low interest rates and quantitative easing as well as deficit spending by the government.
Hedge funds like Ray Dalio's track credit and do it to a precision that is widely regard as even better than the federal reserve.