“I think Europe is in really bad shape unless it begins to make some more painful structural changes,” he says. “Monetary policy is not going to save them. Also, I think China will slow down to growth under 5% over the next five years [because of demographics, not a profound failure]. How well they manage that slowdown process is a major concern of mine.”

Are there things that could help the economy? Looser, but not-too-loose, lending policies, especially for mortgages; a better corporate tax policy; selective infrastructure building and improvements; and better education and training policies, Johnson says.

Roger Aliaga-Diaz, a principal and senior economist with the Vanguard Investment Strategy Group in Valley Forge, Pa., says, given that “the increasing share of U.S. companies’ earnings in the U.S. equity market is generated overseas, one would think that there is an increasing influence of world affairs on the performance of U.S. markets.

“In theory, more international trade and more international capital moving across borders mean that global equity markets are becoming increasingly correlated,” he says. “However, the reality is that U.S. markets haven’t been very responsive to isolated world events, as meaningful as those events may have been for regions where they took place.”

For example, several crises overseas had no persistent resonance in U.S. markets—not the Japanese collapse in the ’90s nor the crises in Mexico in 1994, Asia in 1997, Russia in 1998 or Brazil in 2002.

“More recently, the U.S. equity market fared well on average throughout the deepest portion of the euro-area crises,” Aliaga-Diaz says, despite gridlock in Washington during that period.

He sees bright spots in the current U.S. economy. GDP growth is now above the trend for two key reasons: The pace of consumer deleveraging is easing. There are also signs that business investment is picking up moderately—an indication firms may be more optimistic about future demand prospects. And job growth is at a pace where “we could see the unemployment rate approaching levels consistent with full employment sometime in 2015.”

But he also sees pitfalls.

“Frankly,” he says, “things that worry me on the domestic front are Congress and policy gridlock: They have been particularly damaging for the consumer and business confidence … and those have significant impact on the markets.