you'll need to register with GMO (free) to access the link but it's well worth it as the commentary is truly excellent.
A long-time market strategist and head of GMO in Boston warns that we are close to reaching the historical danger zone of valuation for US equities (apart from "quality" stocks which are roughly speaking franchise businesses with high RONA and reasonable valuations). Grantham has a strong record of forecasting and called both the overvaluation prior to the credit crisis and the low in March.
I take his warnings seriously. As he is the first to admit, speculation can continue for an indefinite period of time but sooner or later the balloon pops. I think a major lesson learned over the past 20 years is that one needs to maintain absolute mental clarity about when your investing is investing and when it's speculation. We are starting to enter the speculation zone where most US assets are priced for perfection (including bonds). This is a natural consequence of excessive liquidity.
My theory is that this time the Fed will prick the bubble once it sees the recovery firmly established. It has already warned financial institutions to be ready for at least a 2% jump in interest rates and I believe is running stress tests on this basis.