I think people are complacent. But complacency is like any other metric. It's easy to measure where it is, but it's hard to tell how persistent it is. What causes really big bear markets is not just when people are overly complacent - it's when that complacency is sticky. As long as the skepticism can refresh itself, I think that the markets are still quite viable.

There's an old line that goes, the truck you see 400 yards down the road is not the truck that hits you. When we see these problems coming, they usually get defused. Brexit may have been a surprise, but we recognized it as something that could possibly happen.

People are getting tired of being constantly on edge. Maybe that means they do let down their guard or that they're complacent. What does it take to shake that? A 5% correction? A 10% one? Those kinds of declines are unfortunately something you put up with.

I always think of the economy as going down a pretty broad road that has mud on either side - for inflation and deflation. What hurts the market is when we unexpectedly swerve into one of those mud banks.

The fact that the bond market is rallying today is a plus. If this ends up being a bear market, it will be one of the first ever that began when interest rates are down.

What caused 2008, in my opinion, is that people just didn't see the risk. These people that took on all this risk didn't think they had it - they thought they hedged it all away. As long as there's a perception of risk, and a culture of looking for risk, it's going to be hard to deflate us.

Both cream and scum can rise to the top, unfortunately. This lower-quality stuff that's going higher isn't doing it on fundamentals.