According to Russell Investment Group's quarterly Investment Manager Outlook discussed in today's Wall Street Journal (subscription required), 17% of money managers think U.S. stocks are overvalued, the highest number since the survey began three years ago. Some commentators believe that the number suggests that the 5-year long bull market is starting to wane.

I don't know about that. If you're a follower of the strategies outlined in David Dreman's Contrarian Investment Strategies, the appropriate reaction would be to buy. Think about it this way: What drives stock prices up? New money coming into the stock market. When money managers are bearish, that means that they've most likely cut back on their U.S. equities exposure. Many have probably even gone short on some of the indices. In other words, the record 17% of managers who are bearish can't do anything more to deflate the market. On the other hand, if they change their minds they will have to buy back in, which of course could only help to boost stocks.

Still, 17% bearish isn't that big of a number and given that only 353 managers were surveyed, it would probably be an overreaction to trade based on this news.

But here's an interesting item: "As troubles continued in the sub-prime mortgage market, real estate remained the least-favorite asset class, favored by just 12% of managers."

Is it time to take another look at REITs?