This is the most dangerous and overvalued stock market on record — worse thanworse thaneven worse than Or so warns Wall Street soothsayer John Hussman in his scariest jeremiad yet. As of Friday, more than one-third of stocks are already below their day moving averages.

crisis: Worse than the Great Depression? - Aug. 27,

More NYSE stocks hit new week lows last week than new week highs, he notes. OK, so, it is always easy to criticize. Hussman, a professional economist and well-known Wall Street figure, has been here before. But he was, notably, also correct and prescient about both the and crashes before they happened, when few others were. According to the World Bank, the total U. That is way above historic norms, and about the same as it was at the market extreme of This is a measure that Warren Buffett has praised in the past as a good indicator of whether or not stocks are overvalued.

Both measures have solid track records over more than years of predicting long-term stock-market returns, though their most recent record is either poor or still unproven, depending on whom you ask.

Market veterans note that even if Wall Street is overvalued, as some of these things suggest, there is nothing to prevent it becoming even more so before any correction. But the more valuations get stretched, the more dangerous it becomes. None of this proves for certain that the current euphoria is misguided. But it is something to bear in mind before we let it go to our heads. Hussman, wisely, recalls the warning of the late, great investor Sir John Templeton, that euphoria is how bull markets die.

Brett Arends is a MarketWatch columnist. Follow him on Twitter BrettArends.

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