Many say that lower interest rates should raise asset valuations by lowering the rate at which future income streams are discounted. This may be fine for high quality government bonds where coupons are fixed, but is not necessarily the case for equities where we are dependent on future flows (earnings, dividends, economic growth, CAPEX).
What is the major determinant of long term real equity returns? Earnings growth, and long term earnings growth is dependent on real economic growth. If we look at real growth rates they are falling, and have been falling for some time. This is part of the reason why interest rates have been falling; that is to accommodate falls in nominal and ultimately real flows.
The following shows annualised annual growth rates over rolling 15 year time frames (in other words geometric returns) compared to the Shiller Cyclically Adjusted PE ratio: