Has Wall Street turned the corner?

Posted: 6:49 PM EST Mar 05, 2013   Updated: 7:53 AM EST Mar 06, 2013

Tuesday was a record breaking day for the Dow.

The blue chips soared past 14,200 to levels not seen since before the recent recession.

Has Wall Street finally turned the corner?

It's a moment investors have been waiting for since 2007, right before our nation's economy took a nose dive.

"The stock market is a leading indicator of the economy and I think we can take heart in this," said  Moravian College Economics professor Jim West.

West says two major factors have led us out of the recession and into a slow recovery. 

Investors encouraged by the fed pumping trillions of dollars into the economy and a surge in company profits coming out of the economic downturn.

"There is a lot of potential  for growth in the economy that the a lot of the financial issues that we were  working through have worked themselves out," said West,

Locally, investors are watching the recovery.

"I think they're concerned but are getting more comfortable," said Bill Schultz, CEO Of McQueen, Ball and Associates of Bethlehem.

Shultz  says a lot of investors have hunkered down in low yield fixed income securities.

He says the Dow's record high may take away some of the general reluctance to go back into the market.

"The key here is make sure you balance what you can afford to invest for the long haul yet keep enough liquidity in short term," said shultz.

The Fed has said it will continue on its current course..infusing the economy with cash by purchasing securities and keeping interest rates low.

But once the recovery takes hold, the fed will have to devise a plan to liquidate its surplus holdings..which could spook investors.

Analysts say while the economy is showing signs of recovery, for investors caution is king.