A Good Reason Why Stocks Are Going Up

I suspected this for some time, but now this from Jack Crooks, Black Swan Trading:

In the chart below it shows the Dow Jones Industrial Average (black line) compared to the Dow Jones Industrial Average Multiplied by the US$ Index (red line), both are a monthly price series. What we noticed is despite the very nice surge in the unadjusted Dow, when adjusted for the falling dollar it is still well off its old highs made back in May 2000 …

Anyone care to offer some conjectures, implications, guesses, or logic …

Our attempts are these:
1. Stocks represent ownership of real assets in the real world. And said assets (just like gold) should reflect "real purchasing power". Thus, a falling dollar means said assets should go higher, all things being equal (ceteris paribus for the economic literati among us).
2. International investors see the Dow as cheap thanks to said dollar demise.
3. The P in P/E (price earnings ratio) is bid higher precisely because the E in the equation is rising thanks to a falling dollar. And of the E generated from overseas sales relative to domestic tends to rise because currency translation benefits back into dollars. When the collective Ps for multinationals (which are a very big part of the Dow) are bid up, the index follows in kind.

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