Crashes happen when all the stars align for it to happen:
High P/E ratios
Tight Credit and rapidly rising interest rates
Geo-political issues
The S&P 500 P/E is now about 16.8, in the mid-range of the historical valuations. And that is including the reduced earnings recently reported
While retail and small business bank credit is tight, treasury rates are low, so the competition for investor funds from governments is small
The geo-political issues are moving in favor of the conservative position as the public has rebelled against this government.
A correction is possible but the amount of money out there for investing is enormous. Traditionally, stocks have done well when inflation is trending upward.
Another point, there has been a well-documented link over the last 80 years between money supply and stock prices with a one year lag. Last year's rapid increase in the money supply, combined with the fall of Obama’s poll numbers, is driving this rally.
And yes, I do invest client money for a living, if any of you are wondering.
I hope you are aware that lower earnings increase the PE ratio.