While the stock market is roughly fairly valued right now, danger looms on the horizon, says Byron Wien, vice chairman of Blackstone Advisory Partners.

The Standard & Poor's 500 Index reached a record high of 1,759.82 Friday and has generated a total return of 23 percent so far this year.

"There are signs of speculation out there, and that makes me worried," Wien told CNBC.

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"Right now investors think monetary policy will remain accommodative indefinitely," Wien said. "When you have a feeling you can't get into trouble, you're likely to take some chances you won't already take."

The Federal Reserve is buying $85 billion of Treasurys and mortgage-backed securities a month. And many economists don't expect the Fed to taper that quantitative easing before March or perhaps much later.

"The feeling is that we're OK for a while, and everyone thinks they're smart enough to know when the music is going to stop," Wien explained.

He says the recent rise of margin debt to a record high also is a worrisome development.

But many investors are bullish on stocks amid their recent rally. "Earnings have been good enough, and the liquidity spigot is open so that people see very little risk in the system," Charlie Smith, chief investment officer of Fort Pitt Capital Group, told Bloomberg.

"It's like a giant game of musical chairs. The attitude on the part of most investors is that they have to play while the Fed got the music going."

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