What Say You, Mr. Market? (the 2013 Edition - Continued)

Picking up right where we last compared Paul Krugman's opinion about the stock market to the chart of the Dow Jones Industrial Average (and nothing but the chart), this is what the financial markets are saying to Professor Krugman these days:

" [...] Major stock indexes are now higher than they were at the end of the 1990s, which can sound ominous. It sounds a lot less ominous, however, when you learn that corporate profits — which are, after all, what stocks are shares in — are more than two-and-a-half times higher than they were when the 1990s bubble burst. Also, with bond yields so low, you would expect investors to move into stocks, driving their prices higher.

All in all, the case for significant bubbles in stocks or, especially, bonds is weak. And that conclusion matters for policy as well as investment. [...] "

And again, here is the 20-year monthly chart of the Dow Jones Industrial Average with only one technical indicator (Bollinger Bands with the 20-period/2-standard-deviation default settings) updated to cover the 4/30/1993 to 4/30/2013 period (click chart to enlarge):

To be continued...