While stocks were trampled further on Wednesday, after tumbling into the close of Tuesday’s trading, amid fears that the coronavirus may continue to plague the U.S., as efforts to reopen the country are underway, one expert believes that the stock market may be more robust than experts imagine.

The Leuthold Group’s Jim Paulsen expressed his belief that investor concerns over the coronavirus pandemic are excessive and projects that stocks will return to all-time highs sooner than it takes for the economy to recover, acting as a forward predicting mechanism.

“Fear is on steroids,” the firm’s chief investment strategist told CNBC’s “Trading Nation” on Wednesday. “In the past where you had high levels of fear, that was typically a very good time to buy the stock market.”

He described a feeling of unfettered anxiety over losing life savings and jobs as classic characteristics of a recession. However, not only are these elements currently visible in this economic downturn, there’s a third element: Fear of losing your life or a loved one.

“The Federal Reserve and the Treasury are scared, as well. So, they’re devoting unprecedented, massive policy support for risk assets,” said Paulsen. “The combination of massive policy support and high levels of fear tells me that asset prices are probably undervalued.”

Of course, not everyone agrees. Goldman Sachs just revised estimates for a 15% peak in unemployment to 25%, which would rival Great Depression levels.

On Wednesday, the S&P 500, Dow Jones Industrial Average, and Nasdaq, and the ETFs that track them, the SPDR S&P 500 ETF Trust (SPY), the SPDR Dow Jones Industrial Average ETF (DIA) and the Invesco QQQ Trust (QQQ), all lost their footing after Federal Reserve Chair Jerome Powell admonished investors that the economy faces real downside risks and uncertainty as the nation tries to contain Covid-19.

Yet, in a recent research note according to Paulsen, a longtime market bull, the market can still reach all-time highs even without a strong economy supporting the move higher.

“Should even a partial restart of the economy take place, the magnitude and diversity of current economic policies could be far more powerful in boosting economic growth and the stock market than appreciated,” he wrote.

Despite his optimism for markets, Paulsen acknowledges it won’t be easy for markets to rally back, especially with the travel and leisure sectors bloody and beaten, and unlikely to rise again soon for fear of population reinfection. of the economy. Nevertheless, he prognosticates market bulls will prevail.

“After the ’08 [financial]crisis, there are still parts of the economy we don’t have back. We don’t have housing back anywhere close to what it was,” Paulsen said. “The unemployment rate took forever to get back down to where it was in 2007. Yet that didn’t stop the stock market from rising.”

If Paulsen is right, that’s good news for Index ETF holders.

For more market trends, visit  ETF Trends.