If bubbles are out there these 10 sages will warn us

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With the Dow Jones Industrial Average (DJIA)  closing above 16,000 for the first time ever this week, it's hardly surprising that market chatter over whether we're in an asset bubble is intensifying. The 2000 dot-com bubble and the collapse of the housing bubble and financial crisis remain painful memories in investors' minds. But are we so scared of bubbles that we see them even where they don't exist? Recently, Mark Dow, portfolio manager at Pharo Management, suggested as much, telling CBNC in an interview that there's "a bubble in calling for bubbles." With that in mind, here's a look at 10 notable names and their recent take on where the markets stand.

— Wallace Witkowski

1. Warren Buffett

The Oracle of Omaha doesn't seem to be worried about a bubble in his favorite asset class: stocks. Recently, Buffett said stocks are not overbought but in a "zone of reasonableness." Last month, Buffett said in a CNBC interview that he doesn't see stocks as being in a bubble at least not for now. "Stocks are not selling at bubble levels, and, what do you diversify into? Do you want to diversify into cash? I think it's a terrible investment compared to equities. Do you want to diversify into long-term bonds? I think it's a terrible investment compared to equities. You're going to have your assets in something and I think good businesses held for long periods of time are certain to deliver good results."

2. Janet Yellen

Janet Yellen took one step closer to being Federal Reserve Chairman Ben Bernanke's replacement after the Senate Banking Committee voted in favor of her nomination this week. On the subject of bubbles, Yellen has stuck to the Fed script , at least when it comes to stocks. "Stock prices have risen pretty robustly," Yellen said at her confirmation hearing, but added that given several factors "you would not see stock prices in territory that suggest…bubble-like conditions." When asked if there was a federal role to support the stock market, she simply replied, "No." When asked about other possible asset bubbles like housing, Yellen said that rising home prices and all-cash deals — especially in hard-hit places like Phoenix and Las Vegas — are a "logical response" from the market. That does little to assure investors who remember Ben Bernanke's assertion that he didn't see a housing bubble in the works during his confirmation hearing in 2005.

3. Marc Faber

The author of the Boom Gloom & Doom report sees bubbles everywhere and Janet Yellen as Fed chairwoman as cause for even more alarm. "I see a bubble in everything that relates to the financial sector," Faber said on CNBC recently. "We have a bubble in bonds. We have a bubble in low-quality bonds. We have a bubble in equities...We have a huge debt bubble and it's only getting bigger, it's not getting any smaller. So we are the bubble, everything that is in the financial sector is the bubble, and it's been pumped up by central banks."

4. Andy Xie

It's not just U.S. stocks that have investors on edge. Quite a lot of bubble talk has been directed toward China lately, especially in the area of housing. Shanghai economist Andy Xie said China's shadow banking industry will likely see a severe liquidity squeeze when the Fed winds down its easing measures, and that will pressure China's property bubble. "China's rhetoric on growth and the Fed's on unemployment have reinforced each other in expanding a gigantic global bubble, bigger than the one before 2007," according to Xie. "When the bubble bursts, the impact on China and the United States will be very different. The United States' bubble is mainly in the stock market and in the properties for rich people. Its debt is not rising rapidly. Hence, when the bubble bursts, it is merely a round trip for speculators. China's bubble is sustained by debt. Its destructive power is much greater."

5. Nouriel Roubini

We're not in bubble territory yet for stocks, according to NYU economist Nouriel Roubini, but that doesn't mean there aren't bubbles forming all over the world. In a Bloomberg interview, Roubini said central bank liquidity is not going to the economic recovery but into financial transactions "We are maybe not in bubble territory for the U.S. stock market, but if you look at housing around the world — Switzerland, Sweden, Norway, France, Germany, Israel, Brazil, Hong Kong, Singapore, China — we have frothiness if not outright bubbles in housing markets in many parts of the world," he said. Also, the tech sector appears vulnerable with start-ups being overvalued based on forward revenue they haven't even taken in yet. In addition, central bankers face a tough choice between killing off the recovery, or fueling growth at the risk of inflating the next financial crisis.

6. Robert Shiller

Nobel-prize-winning economist Robert Shiller recently called bubbles a form of a "social mental illness." While he's said stocks don't appear bubbly yet, and may have room to grow, a recent rise in his cyclically adjusted price-to-earnings ratio is a "concern." Shiller has even gone as far to say that he doesn't expect another housing bubble in our, or at least his, lifetime. "We're kind of chastened by our recent experience," he said in a recent interview.

7. Laurence Fink

Tapering of asset purchases by the Fed cannot come soon enough to calm down bubble-like markets, according to BlackRock Chief Executive Laurence Fink. "It's imperative that the Fed begins to taper," he told a panel in Chicago last month. "We've had a huge increase in the equity market. We've seen corporate-debt spreads narrow dramatically." Blackrock is the world's largest money manager with $4.1 trillion in assets under management. In fact, Fink said recently the Fed should send off Ben Bernanke in December with a "kiss" by starting the taper.

8. Bill Gross

The bond market may be bubbly but not to the extent it will likely pop, said Pimco co-chief investment officer Bill Gross recently, but that's because the appointment of Janet Yellen to head the Fed will keep the federal funds rate artificially low for years to come. To the extent that equity markets are overheated, margin requirements can be raised to counter historically high margin debt, he said.

9. Paul Krugman

The latest from Princeton economist and New York Times columnist Paul Krugman on bubbles stems from his annoyance at former Treasury Secretary Larry Summers, who recently spoke at an International Monetary Fund research conference and got a lot of attention for ideas similar to Krugman's. On the subject of bubbles, Krugman agrees with Summers that they may be part of the not-so-new normal, that "we may be an economy that needs bubbles just to achieve something near full employment – that in the absence of bubbles the economy has a negative natural rate of interest." Back in March, Krugman went so far to say that there's no standard definition for them and that the growing bubble fear had something to do with a "deep hatred" for Ben Bernanke "and everything he does."

10. Adam Parker

Morgan Stanley's chief U.S. equity strategist Adam Parker lands somewhere in the middle. He sees risks down the road for U.S. stocks, but for the moment, he's not all that worried about the market. "[T]here's no doubt that the bubble is in the belief that policy makers will execute a soft-landing from higher prices than we are trading at today, and that is certainly a risk," Parker said in a recent note. "We are currently of the mindset that the Fed will be able to communicate that tapering and tightening are different this time. On the other hand, we wouldn't be surprised if they tapered far later than the current consensus view. Either way, the consensus view is that the monetary policy will have a huge impact on risk-taking in 2014."

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