The Great Rotation - nice theory eh? 

Greetings to our international readers from the GWN (Great White North). https://en.wikipedia.org/wiki/List_of_Bob_%26_Doug_McKenzie_appearances_on_SCTV 

Despite recent volatility, American stocks are de-rigueur these days and the S&P 500 stock index managed to hit a recent of high of +135% from its low of just four years ago.

Where is this money coming from? 

Although financial advisers and equity money managers blissfully dream of trillions of dollars of bonds stampeding back into stocks driving stock markets to new record highs, the word is that the so-called Great Rotation is just not happening.

The data crunchers are scratching their heads. The money is not coming out of bonds at all. As a matter of fact, there is still a lot of money going into bonds rather than out of bonds. 

Maybe the money is coming out of savings products like certificates of deposit? The stats say no, but the rush of investors putting in new savings in the banks [at zero interest rates] has slowed markedly. Does that mean that Ben Bernanke's financial repression is working? https://en.wikipedia.org/wiki/Financial_repression

[Editor's note: search engine results for "financial repression" turns up a whole list of complicated explanations. Here is my take on the term: The U.S. has artificially lowered interest rates in order to make savings painful.] 

It looks like new money rather than savings or bonds has pushed the U.S. stock market to recent highs. 

As far as when the Great Rotation from bonds to stocks will ever start, perhaps the best explanation comes from portfolio manager Michael White who manages the CAD $775 million AGF Canadian Asset Allocation Fund. He tells me: "The Great Rotation will start when investors receive their bond statements with a whole bunch of negatives on it." 

Source:  In search of the 'Great Rotation' - Mark Hulbert, Wall Street Journal's MarketWatch April 9, 2013.