What justifies high stock prices today?
Simple - Market Manipulation (IMHO). Automated computer trading accounts for the majority of the trades bumping up the prices and showing unnatural volume. Take away automated trading and the market and prices will crash.
Sadly, I fear many people don't have confidence in the dollar anymore and so invest in the markets because they think it a better place to hold their cash.
I believe you are spot on, there is no free market .