Why the stock market is way overvalued

A trader works on the floor of the New York Stock Exchange.
Getty Images

Interesting note from Nomura this morning saying the market is currently pricing in 9.6 percent earnings growth in the S&P 500, well above the long-term realized average of 7 percent (since 1945) and much higher than analysts' expectations of mostly flat earnings growth this year.

What's it mean? Optimistic earnings growth + economic uncertainty = downside risk for markets. That simple.