Some good discussion on our forum regarding current high stock valuations, based more on hopes than on earnings.
This chart of Price-Earnings ratios highlights the problem. PEs for both the MSCI World Index (ex-Australia) and the ASX 200 are close to historic highs (after the Dotcom bubble).
Strong earnings growth would soon fix this but there is little sign of that at present.
If stocks had not been overpriced how could there be market crashes in the past ?
Quite right. Overpriced stocks eventually correct to more reasonable values. The adjustment is seldom gradual and is normally achieved through a stock market crash.