A bubble in US equities?

S&P 500, daily, compared to monthly trading volume, 2008 to 2013

I’ve previously written about collapsing volume on the NYSE even as stocks hit news highs and we’re seeing more of the same; the chart above shows S&P500 prices ($SPX, red line) compared to monthly trading volume ($NYTV, tray volume chart). Clearly there has a multi year collapse in trading volume however shares are hitting new highs. As the chart below shows, folks looking at conventional metrics such as price to earnings (aka, P/E) are getting optimistic but is this bull driven by central bank liquidity?

Price to earnings, S&P 500, 2008 to 2013

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