What is the risk in this market?

The market, which is in a bull trend, is not priced for gains. It's already the second-most expensive market in history. Rather, the market is postured to hand investors heavy losses.

Here are some of the underpinnings of this economy that could affect the ability of the market to increase further in value:

1. The market is strong because of the $600 billion the federal government printed to stimulate the economy, called “QE2,” this year. In June, the last of the QE2 funds Congress authorized will be spent. At that point, it is likely the market will sell off. QE2 funds go to the banks, which lend the money to brokers. The government hopes that when QE2 is terminated in June, the market — and the economy — will be able to sustain themselves. That is unlikely. Thirty percent of current federal government expenditures are borrowed, and without the borrowed funds, the government cannot continue to operate. Look for more government borrowing. More debt creates additional financial burdens, which this economy is already incapable of handling.