Are you getting the sense that the market is kind of hanging in the air, like Wile E. Coyote right after he goes running off a cliff?

And that the next step might be a long whistling fall, followed by a distant thud and a dust cloud?

Yeah, me too. Look at what's going on. Banks are still playing accounting games, the number of delinquent mortgages just set a new record as the much-ballyhooed "mortgage modification" program looks like a failure, unemployment is still raging, and some seriously respected investors are saying that much of the market seems to have gotten ahead of itself, pricewise.

Oh, and Goldman Sachs (NYSE:GS) is making tons of money, which is clearly a bad sign. (OK, not really. But still.)

Clearly, those "green shoots" aren't looking so green -- or if they are, it's the kind of green stuff one used to smell at Grateful Dead concerts back in the day, if you get my meaning. And while I think a big-time return to bearishness is unlikely before Labor Day, once September rolls around, I'm going to be pretty worried.

And that leads me to the hopefully-obvious question: What can we be doing now in anticipation of a possible -- but to be clear, by no means definite -- significant market drop in the near future?

Take a long, hard look at what you've got
Here's what I'm thinking: An awful lot of stocks have had big runs since the lows in March. In many cases, the stocks that have had big runs have been pretty lousy. This may be simply a result of non-failure -- they were priced for bankruptcy and didn't file, and so people jumped back in despite the fact that many of them were priced for bankruptcy for a reason.

As my fellow Fool Morgan Housel noted back in June, some of the rally's biggest gainers -- companies like Dollar Thrifty Automotive, which is now trading around $21, up from $0.62 in early March -- are stocks that, in his words, "you wouldn't recommend to your worst enemy."

Yet, some of the best companies out there have been left out of the market's big run. How fair is it that Dollar Thrifty is a 33-bagger and these stocks are … well, take a look:

Stock

CAPS Rating (out of 5)

P/E

26-Week Gain

% Below 52-Week High

Emerson Electric (NYSE:EMR)

*****

13.9

18.4%

29%

Johnson & Johnson (NYSE:JNJ)

*****

13.3

10.5%

17%

Novartis (NYSE:NVS)

*****

13.5

10.7%

20%

Hasbro (NYSE:HAS)

*****

13.7

12.5%

37%

Procter & Gamble (NYSE:PG)

*****

12.4

5.1%

28%

Total SA (NYSE:TOT)

*****

8.3

11.8%

26%

Source: Motley Fool CAPS.

I turned these up with some screening -- they're just ideas, not recommendations right now. But let's see … Procter & Gamble and Johnson & Johnson are two of America's best-run companies, Total is a well-managed oil giant, toy king Hasbro may see a weak holiday season, but they'll bounce back, Novartis is a solid name … you get the idea. These are, at first glance, very good companies that have been largely passed over by the rally. They've seen some smallish gains, but they're still well below their 52-week highs.

Meanwhile, plenty of folks are holding stocks that have had big gains, and plenty of others are just looking for a relatively safe way to get some stock market exposure.

You see where I'm going with this?

The upshot
There's clearly still value to be found in the market, the rally notwithstanding. Given the continuing uncertainty, and the dubious state of economic fundamentals, I think it's time to think about playing defense, and buying value is one of my favorite ways to do that.

If you haven't already, consider moving some of your assets into good value-priced names like the ones I listed above. Your downside is limited, there's definite upside, and in many cases, you'll collect a decent dividend no matter what the market does in the near term.

What do you think? Is it time to play defense again? Scroll down and leave a comment letting me know.

If you're looking for value, the Motley Fool Inside Value newsletter is the place to look first, with its exclusive list of the best places for new money now. Check it out on us with a free 30-day trial.

Fool contributor John Rosevear is surprised that his son's Nerf-dartgun addiction alone hasn't led to record profits for Hasbro. He has no position in the companies mentioned above. Hasbro is a Motley Fool Stock Advisor pick. Johnson & Johnson, Procter & Gamble, and Total SA are Motley Fool Income Investor recommendations. Novartis is a Motley Fool Global Gains pick. The Fool owns shares of Procter & Gamble and Hasbro. Try any of our Foolish newsletters today, free for 30 days. The Motley Fool has a disclosure policy.