The economy’s fine, inflation’s nowhere to be seen, deflation risk has abated, interest rates are low and fears over European politics—Britain aside—have so far proved unfounded. It’s easy both to explain why markets have been celebrating, and why so many people are worried that everything’s just too perfect.

The state of the economy easily explains high stock prices, low volatility and low bond yields. We’re in what’s increasingly being called a “Goldilocks” economy, which like Baby Bear’s porridge is not too hot and not...