Devoted to understanding the basics and fundamentals of investing

Yesterday I introduced brief mini-series of the top 5 reasons the market either a) has plenty more to go on the downside, or b) is in for a turnaround and has better days in the near future. Yesterday I looked at the top 5 reasons the market has plenty of room to go on the downside, so today it is time to look at the top 5 reasons we are in for better days.

Top 5 reasons the stock market is in for turnaround soon

1. The bad news is out there and has been out there for a while. Sure there are plenty of new pieces of bad news crossing the wires everyday, but it is nothing that we shouldn't expect. There is nothing blindsiding the market in the current environment.
2. Stocks are not expensive. The truth is stocks are actually fairly cheap on a historical valuation basis. They certainly are not so expensive that a long-term bear market should be predicted. In the bubble of 1999 the S&P 500 sported a P/E ratio of about 33, while that level now sits at about 16, right around historical averages of 15.5.
3. There is plenty of growth in certain sectors. If you watched the news right now you would think that the entire economy is falling apart and no one can make any money. This is not the case. The basic material names, tech names, and many healthcare names are doing quite well.
4. The reality of the matter is that the consumer has continued to hold up relatively well with the increasing pressure from all angles. If the consumer continues to outperform expectations, the recession may be a short lived one. Stocks look to the future, so even if we are in a recession now, stocks may bottom sooner than some think.
5. It's difficult to bet against the U.S. market over the long run. Stocks have historically been a great investment over the long-term and there is no reason to believe that will change anytime soon, despite short-term setbacks.

Now I'd like to get some feedback from my readers. What do you think? Which of the top 5 reasons has more credence? What are other reasons for a turnaround or continued losses in the market?

 I know for myself overall the top 5 reasons the market isn't done going down was much easier to make than this list for a turnaround, so that might be a hint what I am thinking. The one positive thing that I stand by is #5 here on the turnaround list: it's dangerous to bet against the stock market in the long run, so be careful not to get too negative.