Historically, equity prices are high and may be indicative of a stock market bubble. Equity yields have recently fallen in comparison versus U.S Treasuries and corporate debt suggesting the equities rally may soon run into resistance.
House prices in the U.S. rose by 11 percent last year, acting as a further signal for a potential stock market bubble.
However, there is unlikely to be major downturns in the stock market and house prices unless there is a sharp upturn in the inflation rate.