When the recession comes, stocks will go down. The Fed can’t cut rates enough to prevent or heal a crash. Typically the Fed needs to cut rates by 5% in a crash; since they are now at 2.4% they would have to go to negative 2.6% which can’t be done without destroying the economy, and thus it won’t be cut to a negative rate.
The intrinsic value of the SP is 1,800 (the peak was 2,954); the intrinsic value of the SP could even be as low as 1,100. If the Fed can only provide about half of the rate cuts needed to heal the next crash then perhaps stocks would get stuck at halfway between intrinsic value and their high water market, perhaps at SP of 2,200, a 25% loss. A possible solution would be for the Fed to buy stocks but this is not allowed by their charter; Congress would need to authorize this but the (sometimes) hard-money Republican senators might oppose this. Perhaps a compromise would allow the Fed to bail out only a privileged “Too Big To Fail” few companies, like in 2008. Perhaps they would be allowed to subsidize failed banks, pension funds, and government agencies that lost money while the Fed ignores the individual owners of stocks.
Japan’s central bank has bought stocks in Japan and made interest rates go negative but the Nikkei index is still 45% below the all-time high of 1989.

  Investors have incorrectly leapt to the conclusion that the Fed has their back and will rescue them, but some aspects of central bank rescues are an unreliable placebo instead of a real cure. Quantitative Easing often buys a bond from a bank and then the bank receives cash from the Fed which it stores in its required reserves and thus the funds can’t be lent out and the Fed pays the bank a lower yield on cash than what can be earned from a bond, so that aspect of QE is explicitly a stupid, worthless placebo. QE is deflationary as it grabs a high yielding bond from retirees and replaces it with lower yields of a bank deposit, thus triggering bad feelings and less consumer confidence in retirees, and pre-retirees. This in turn has a worse effect on consumer behavior than the “Wealth effect” of rising stock prices. The moderate economic status retirees need to get a full degree of yield from their retirement nest egg in order to function properly as a retiree. If they are deprived of yield they may have to sell their home and rent a smaller residence and this will put their economic situation into a mini-depression, thus reducing consumption, and reducing tax revenue.
The huge increase in PE10 ratios for stocks, of double the traditional PE10 metric of 15, was an unsustainable event caused by central bank bubble making, combined with placebo of a myth that the Federal Reserve can magically fix the economy and control stock prices. Eventually the truth will be revealed and stocks will be unable to be fully rescued by the Fed in the next deep crash.