Global stock markets are flying. In the US, the Dow Jones has shot past its all-time high to trade at more than 20,000. The UK’s FTSE 100 is also breaking records, having burst convincingly through the 7,000 barrier after years of trying.
Bonds are now in a bull market that has lasted more than 30 years and have constantly shrugged off dire warnings of a meltdown.
Property prices continue to power upwards as well, rising another 5.3 per cent over the past 12 months, at their fastest rate for two years, according to the latest Knight Frank Global House Price Index.
Nothing seems able to stop the global surge in asset prices, which has also driven the price of many commodities, including industrial metals and in recent weeks, oil and gas.
Investors have shrugged off war in the Middle East, the Chinese property and credit bubble, euro­-zone stagnation, Brexit and the US president Donald Trump, as they continue to drive assets higher and higher.
So why isn’t everybody celebrating? Instead of throwing a party, many investors are watching events nervously, seemingly waiting for everything to go wrong.
Some are more nervous than others. Fund manager David Coombs, head of multi-asset at Rathbone Unit Trust Management, says markets are brewing up a perfect storm, and conditions are ripe for an imminent market correction of at least 10 per cent. It could be more.
He is now holding the highest-ever cash weightings across his portfolios, despite record low interest rates because he saw danger almost everywhere else, according to a report on FT Trustnet.
Mr Coombs isn’t just worried about stock markets falling, he is struggling to find worthwhile investment opportunities across just about every asset class. "We dislike bonds, we dislike property, we dislike infrastructure, we are looking at commodities but they’ve had a bit of a rally. We don’t even like any of the alternative asset classes to be honest. It is really tough at the moment," he says.
Mr Coombs has a strong investment track record. Since launch in 2009, Rathbone Total Return Portfolio has returned 58.65 per cent compared to its benchmark’s return of 23.92 per cent.
So can stock markets, bonds and property really all crash at the same time? If so, how can investors protect themselves?
Plenty of other analysts also believe that stock markets are overvalued. Josh Mah­oney, a market analyst at online trading platform IG, which has offices in the UAE, says a rising gold price is a traditional sign of danger ahead, and it has recently spiked to a three-month high at around $1,240, suggesting the flight to safety may have already begun. "The outperformance of gold, alongside lower-risk bonds and safe currency haven the Japanese yen highlights the worries rumbling beneath global markets.
He suggests the "ominous quiet" across US markets may be a signal that something big is on its way. "The current flows into gold and US Treasuries and away from the S&P 500 is another indication that the equity rally is looking exhausted."
Kathleen Brooks, research dir­ector at City Index Direct, says political dangers are growing, with elections in the Netherlands, France and Germany, where populists could make further headway, Brexit worries and a potential flaring up of the Greek debt and Italian banking crisis.
Then there is The Donald. When Mr Trump was elected president, stock markets surprised everybody by rising rather than plunging in panic. Investors chose to accentuate the positives of his proposed $1 trillion stimulus blitz and eliminate the negatives such as a potential global trade war.
However, Ms Brooks warns this may not last. "The president’s big test will come on February 28, when he addresses the US Congress. If he fails to deliver tremendous, even beautiful, plans on taxes and infrastructure spending then the bottom could easily fall out of the market."

Source: The National