Totally it's going to be a good thing.
When the market finally corrects, either in the near future or after another new high, or when ever it ends up being, it'll be a blessing in disguise. A bubble doesn't do anybody any good be it in real estate, the Nasdaq, or anywhere else. Nasdaq is a good example actually. During the .COM bubble honest technology companies doing real work often had a hard time finding financing because they didn't have the zappy looking brochures and stock prospectus to show they were going to triple their market size in the next 3 days. A lot of companies are privately owned, or partnerships, etc, and never got a dime of the money that flowed into wall street unless it was through customers. That much waste and in some cases outright fraud isn't good for anybody except for the speculators who want to take your money on the dips and crests, it's just non-sense, and it had to end. Waste and inefficiency is not good for the economy, period, it only helps a few who are in on it.
At the worst of the .COM stock market boom companies were hiring people to do technology jobs that didn't know a damn thing about what they were doing. It was crazy, I'd never seen so many unqualified people making decisions beyond their abilities in my life, it was beyond funny. Companies seemed to be trying to out-do each other with whatever crazy ass idea they had in mind, ferrari's for the board members, offices run under some stupid organizational chart created by eastern mystics, or whatever. And a good strong correction in the Nasdaq got rid of that, many of those kinds of inefficiencies are gone (thankfully), or are being culled. At the worst of it there were so many facades that called themselves companies you couldn't even count them, they were everywhere, "companies" built entirely out of paper, wild ass ideas that could never work, etc, it was a relief when all that finally got blown away and some kind of sanity was restored.
The economy needs bad times, they are necessary. Over time waste and inefficiency just builds up, and you need lean times to get rid of it. It's easy for example for a company to hire inefficient suppliers or waste money on unnecessary expenses, etc, when times are good. But a good strong recession makes it tough on them, and they optimize their operations, or die, and get weeded out. It's a darwin thing, and it's necessary. It also gives small companies a chance to shine because it creates an environment where the strong and agile can not only survive among giants, but actually thrive and BECOME giants. Lean and mean is important during down times. And the most important product of busts is better decision making, because decision makers either start making absolutely brilliant decisions that align well with reality, or their delusions quickly undo them. Many decisions that are considered to be "good decisions" during a boom don't even qualify as "entertaining fantasies" during a bust.
During booms you just get a lot of non-sense going on, bad loans, huge numbers of unsustainable derivatives, false expectations not based on reality, etc. Everybody thinks they are a prophet when the market is in a bubble, because everybody thinks they are making money. Like now, when the Dow is reaching new heights every person in the market thinks that the stock they own is actually "worth" what the price is, meaning that they think they could all sell for that price and cash out. It's an illusion, if even 1% of the people try to sell at that price it'll cut the price in half during a bubble, and having so many people base their entire future on illusions and .. well, delusional, a giant mass delusion, it's just not sustainable. The world is simply a better place when we all have a rational expectation about the future, when peoples hopes and dreams are actually attainable and within their reach, etc.
In debt and financing a busted bubble is fantastic for "the little people". Property values fall so that average home makers with children can actually afford to buy a house, using a house for what it was intended to be and not just as an instrument to make capital gains. Having money in the bank becomes a good thing because you actually get a real return on investment and not just the illusion of fantastic wealth in the stock market bubble. Lenders become sane again and actually start lending money to people who can pay it back. Expectations about who can borrow and who shouldn't will become more reasonable, right now banks loan on credit report numbers which are in effect "facades" for most people which allow them to over-extend and borrow dangerous amounts of money just by paying their payments on time every month even while it breaks their backs. A collapse of the debt bubble will increase the savings rate giving people peace of mind and making the money in your pocket valuable again, it'll bring some sanity back to lending, and at the bottom will increase investment into small profit making endeavours that have trouble finding financing right now because they aren't "easy" to invest in.
And a bust also brings sanity back into peoples lives too. It stops being about big SUV's and who has what model BMW and starts being about taking good care of your children, enjoying your life, and other more tangible assets. Communities and people always come together during times of bust, and though it is hard for everyone, the adversity makes people appreciate the good things in life and restores peoples hopes and faith in the future. During bubbles nobody is satisfied, but during times of bust most people can feel good about their lives and feel they are good people and that the have a role to play in the world. Sure, it's bitter at first, but it's necessary for national perspective.
It's good stuff. And necessary on a periodic basis to get rid of fraud, inefficiency, and waste.
