Regarding the May 2010 decline
Towards the later part of April, the market was due for some sort of pullback. The seasonality conspired with the negative events in Europe to deliver a sharp and for many a painful decline. It remains to be seen what will happen going forward. The market should, in theory, rally from here or at least recover somewhat. The character of the subsequest rally may be a guide to what is the likely outcome.
One possibility of course would be the continuation of the decline similar to what happened subsequent to January 1973 peak. There are, however, a number of differences between the environment then and now. Interest rates and inflation were different for example. Furthermore, the decline then took place after the market has seen a good move that took over 30 months to complete. The current upmove is just over a year old (March 2009 to April 2010).
One important consideration is that this continues to be in a very low interest environment in both Canada and the United States. As the volatility subsides, it will be interesting to observe the action on the higher yielding instruments.
Chart courtesy of quote.com, follow the link for a complete view
Disclaimer: Please note that it is important to do further research and consult a licenced investment professional prior to investing in any security.