Can the portfolio rebalancing approach and the fundamental approach to asset valuation be made compatible?

The portfolio rebalancing approach to asset prices is as follows: money and other assets (bonds, equities, real estate) must represent a stable proportion of total wealth. If the money supply increases, total wealth must change in line with the money supply. This is achieved through a rise in the prices of other assets that is similar to the increase in the money supply. The fundamental approach is well known: the price of an asset (share, real estate) is the discounted sum of the future income provided by holding the asset. There is therefore no reason why the price of an asset generated by portfolio rebalancing must be identical to the fundamental price of an asset. So we have the following possibilities: Financial and real estate asset prices permanently diverge from their fundamental value, especially as the money supply is growing rapidly; Financial and real estate asset prices fall back to their fundamental value, and economic agents end up accepting a sharp increase in the proportion of money in wealth; Investors believe that the money supply will follow a path that makes the two approaches to asset price determination compatible.