Why you should like stocks in the short-run. And why you shouldn't...

10 reasons why stocks presently make sense:

1. At 14 times (give or take) next year's earnings, the S&P 500 is, historically speaking, reasonably priced.

2. Half of the S&P has reported Q1 earnings: 81% have met or beat expectations (12% met, 69% beat) .

3. Interest rates are at record lows, allowing, historically speaking, for what analysts call multiple expansion. Meaning the price to earnings ratio (multiple) of your average share of stock tends to run higher during periods of low interest rates---meaning stocks can trade noticeably higher.

4. Balance sheets have been largely scrubbed clean post recession and are bulging with cash.

5. World central banks are in the mood to inject liquidity into every dry hole they can find. The stock market loves accommodation.

6. The economy, albeit tepidly, is trending positive.

7. No core inflation in sight.

8. Residential real estate appears to have finally bottomed.

9. The retail investor (think average bloke with a 401k) is still reluctant to join the party: He/she's usually the last to show.

10. Overall level of skepticism is healthy: "Bull markets grow on skepticism" J. Templeton.

1 reason why you shouldn't act on the above --- or, why you should maintain your long-term allocation and rebalance (only to your equities target) out of upturns and into downturns:

All things economic (and market) being cyclical, every one of my 10 pros will one day experience its inflection point. And, make no mistake, you won't call a single one. In fact, inflection points are only recognized in retrospect, and they're usually cloaked in extreme sentiment with the momentum. Think tech in '99 (euphoria), real estate in mid '07 (euphoria), and the broader stock market in the spring of '03 (terror). Better, therefore, to allocate your assets in a manner consistent with your temperament (less stocks if you're prone to panic) and your time horizon (less stocks if you're getting up there in age). And, again, rebalance (you would have been selling in '99 and '07, and buying in '09) twice per year to your target.