Doug Kass of TheStreet.com’s RealMoney, who successfully called both the market decline in late 2008 and the rebound in March of 2009, is becoming wary of the current rally. Kass feels that the current valuation of the market is pricing in a much more favorable economic environment and is not taking into account the probability of more negative outcomes.

According to Kass, analysts have raised 2010 S&P 500 earnings estimates to levels that would have been hard to believe earlier this year, and may also be very hard to achieve. Although Kass is not calling for a significant market decline, he does see the risk/ratio of the market as the least favorable it has been this year.