Withdrawing from the Stock Market

I've decided to reduce my stock holdings to about 1%, which basically means I'm out of the market. This market has moved out of alignment with the signals coming from the bond markets and do not seem to be factoring the potential negative consequences of the twin deficits that have ballooned under current macroeconomic and war policies of the Bush administration. I believe we are poised for a sharp downward valuation in securities and a negative growth environment in the "real economy," as well. In other words, I'm predicting a stock market crash and, at the minimum, a recession. I can't time these things, but I'm also not willing to stand around waiting to see if it is a longer versus a near-term phenomenon. But before you follow my drastic measures, you should consider the counter case, which would include pointing out that the flood of new oil money being accumulated, in U.S. dollars, in the oil producing countries has resulted in a increased demand for U.S. assets, including stocks and long term bonds. China continues to be a major purchaser of U.S. treasuries and has done more to prop up bond prices, keep the U.S. housing market afloat, and make it possible for U.S. consumers to continue building up household debt than probably any other player in the financial markets. There is every reason to believe that the Chinese government will continue to subsidize our profligacy, including financing the occupation of Iraq. These factors may mitigate any negatives and allow the market to hold up, if not move higher. Nevertheless, I just think it is time to pull out and reevaluate. I'm quite risk averse, as you may have gathered from this strategy.