Three reasons why I believe lows are not yet in

I've been in cash since late 2021. For some specific holdings, I was in cash a little longer. I've ignored the urge to buy over the last several months despite a couple compelling rallies. I believe we're headed lower in early 2023, and here's why.

1. Shiller PE has exceeded 30 three times in history (four if you count 2018 as a separate occurence): 1929, dot-com, 2018 and 2020-2021. In every instance, a correction followed. We are still at 29.26. That is very expensive. I'm not going to get into the details of why I think criticisms of Shiller PE are mostly misguided, but I think any criticism that could be levied is probably outweighed right now by the fact that we have the highest Fed Funds Rate of the last twenty years, and that should significantly impact the price we're willing to pay for earnings.
2. The terminal rate is now likely going to be higher than previously thought, yet the market hasn't adjusted. In the September dot plot (page 4: https://www.federalreserve.gov/monetarypolicy/files/fomcprojtabl20220921.pdf), not a single FOMC member projected a terminal rate over 5%. Last week, Powell himself said the terminal rate will be higher than projected by that dot plot, and we can probably back into that conclusion just by starting with the current rate target (3.75-4%) and adding in a couple very likely looming 50bps hikes. Just those two hikes get us to 5%. Does anyone honestly believe the Fed will be done at that point? I can't imagine so. While the path down to 5-6% on CPI might be somewhat easy, it's highly unlikely it won't take more to get to 2-3%. I don't think stock prices are properly accounting for this material change in expectations and its corresponding real economy threat.
3. Markets don't bottom before recessions begin. This hasn't happened a single time in the last 80 years (see for yourself: https://www.macrotrends.net/2324/sp-500-historical-chart-data). While markets might bottom before a recession is declared, the beginning date of that recession (declared after the fact) has pretty much always been before the bottom of the market. Does anyone think a recession will be declared to have begun in Q4 2022? I can't imagine so with unemployment this low. This is a point I see people get wrong all the time on this sub. While it's true that stocks often head higher before recessions are over, they don't do so before recessions begin.

Those are my reasons. Now feel free to throw all of your “DCA is the way” and “If you wait for the robins, Spring will be over” shoes at me.