I'd say the market was being perfectly rational at the time. Not only were equities riding a major bubble, but we're talking about literally the biggest GDP drops ever, since we started keeping records anyway. In a free market, this would have been the crash to end all crashes.
That's one of the cruel things about both government interventions and markets in general: they punish the rational.
While I do agree with you in principle, it is actually perfectly rational to buy equities in this context. It's hard to swallow, but the reality is that the decoupling from equities, or financial markets in general, as also Treasuries are nearing bubble valuations, and the real economy, namely the GDP, is perfectly coherent with the massive financial stimulus it has been poured on the economy since 10 years ago
That's quite easy to say now, in hindsight,
after the Fed pumped $3 trillion in QE (75% of its balance sheet) inside ~3 months, with another $3 trillion in stimulus spending by Congress over the same period. These levels of market intervention were completely unprecedented. We're talking 10x the size of TARP and beyond. It's downright silly to make comparisons to previous generations of QE and say it was rational to buy the knife in March (or not to sell) on that basis.
It's funny, I was one of the only people around here predicting a V-bottom in stocks back in March-April. Now everyone is trying to act like it was so obvious.....