(FORTUNE Magazine) – Looking back on it a few years from now, something surely will stand out, some signal that should have warned us that our infatuation with the stock market had gone too far. No, it won't be those stratospheric price/earnings multiples and the like. Wall Street Cassandras have been wagging crooked fingers at us and ranting about the market's out-of-whack fundamentals for years. Had we listened, we'd have missed half the fun.

No, what we're more likely to remember is how, at some point, America's childlike faith in a benevolent stock market evolved into something more ominous: a manic, gaudy, excessive buzz in the air, like a party where the guests have begun to talk too loud and dance on the furniture. The signal may turn out to be the sudden passion among Connecticut's Wall Street riches for English nannies and million-dollar stone walls, both designed to give their enormous nouveaux estates the patina of old money. Or the spasms of Ferrari buying by Silicon Valley striplings made centimillionaires by Internet IPOs. Or maybe the real giveaway will turn out to be the second coming of Ivana Trump, scheduled to resurface soon on a new upscale lifestyle cable channel flogging jets and furs to anyone with too much money and too little time.

Then, again, the harbinger might be you. Yes, you! Strolling past a jewelry shop window you've ignored a thousand times before, you may suddenly find yourself fogging the plate glass, seriously debating whether you deserve a $2,000 wristwatch now that the stock market has ballooned your once-meager retirement savings account and turned you into practically...A MILLIONAIRE!

Now, relax. This urge to spend is perfectly normal. Economists call it the wealth effect--the logical tendency of people who own stock to spend more money when the stock market goes up. Ever helpful, economists have even calculated that each dollar in incremental appreciation in the Dow translates into an additional 3.5 cents plunked down at Neiman Marcus or Pebble Beach.

What is disturbing is how hard the wealth effect is working these days. It's one reason that consumer spending jumped 6.2% over the past 12 months, to an annualized $5.8 trillion, while personal income rose just 4.9%. It's also a reason yacht sales have climbed 143% since 1993 and why Daimler-Benz is gearing up its Tuscaloosa, Ala., factory to build 23% more M-class sport utilities. You may recall that last time the wealth effect reached such a pitch, things ended rather badly, in the crash of 1987.

Arguably the spending then had a more frantic flavor, as pent-up demand burst out of the Paul Volcker recession, and everyone borrowed to the hilt. Today's high-lifers don't do that. "It's incredible," says Bill Healey, co-owner of Viking Yachts, a New Jersey builder of sport-fishing boats. "In the '80s everybody borrowed 80%, 90%, even 110% of the boat's cost. Now they pay cash."

Even so, it's hard to shake the sense that this binge will end the same way as the last one. I mean, it's not as if we earned all this money. All most of us did is buy stocks or mutual funds and then watch as, for reasons no one has adequately explained and none of us could have predicted, our investments doubled and quadrupled in value. Yes, the bull market has extravagantly blessed many who created new enterprises, an admirable thing. But come on: We're not talking Andrew Carnegie here. You come up with a nifty Website that has the potential to deliver everything except profits, and investors turn a fire hose of money on you. How enduring is that? And try making sense of the sums sloshing around brokerages and investment banks. Their only discernible contribution is to advise the rest of us where to aim our hoses. Then, as we blast hopefully away, they divert some of the gusher into their own buckets. Last week an analyst--a mere researcher!--reportedly inked a $25 million compensation package with Salomon Smith Barney.

Maybe there's nothing to it. Maybe the market has indeed been permanently altered by the information era, or whatever, and the wretched excess of the age is no more a sign of a peak in the S&P 500 than a dividend yield under 3% (a classic red flag that has been futilely predicting a crash since 1993). But if we aren't near a market top, then we have entered a truly gilded age. Let the Dow put a Range Rover in every garage! A Rolex on every wrist!

Whatever stocks do next, no one can deny that the market has engineered a stunning increase in America's paper wealth during this decade. Even with the market's recent quavers, the bull has inflated investors' portfolios by $6.7 trillion since the correction in 1990. Fattened by capital gains and stock-option exercises, incomes have also skyrocketed. In 1984, according to the IRS, only 14,834 people reported earning over $1 million. In 1996, the most recent year recorded, 111,728 people did.

A disproportionate share of those seven-figure paychecks landed on Wall Street, as detailed in the article that follows, "Where's the Loot Coming From?" Ten years ago only a handful of top Wall Street firms handed out million-dollar bonuses, and only to a few primo performers. Today, virtually all brokerage houses and investment banks are shelling out gargantuan bonuses. Even commercial banks have joined the game. One headhunter who specializes in finding Wall Street talent says there are now hundreds of people at the likes of Chase Manhattan and Citicorp making a million dollars a year.

The cascade of money is age blind. "The first year out of Harvard Business School, a new hire gets an $85,000 base salary and a $40,000 bonus," says the headhunter, who asked to remain anonymous. "By 35, a good investment banker will be making $150,000 base and getting a million-dollar bonus."

At that point an enterprising Wall Streeter can light out for his own hedge fund or brokerage and settle down to getting really rich. Like Christopher Block, 31, who quit his job as a trader at Lehman Brothers a few years back and started the brokerage Block Trading with a Lehman pal, Jeffrey Burke. Revenues at the Houston-based firm reached $20 million last year.

Block, who grew up middle-class on New York's Staten Island, is giddy with money. "I didn't know how to spend money until a few years ago," he says. A quick study he has proved to be. Block and Burke bought Porsches in 1995, but when Burke gave his to his fiancee, Block decided he couldn't drive the same car as she. He bought a $125,000 Ferrari. A year later he bought a $1.1 million, 7,000-square-foot house on four acres in Houston, complete with six-car garage, tennis court, bocce court, and koi pond. Now, in the finest Texas tradition, some $25,000 worth of bronze horses and other animals gambol in the front yard. Inside he's got a $13,000 concert piano and a $25,000 movie-projection setup in his screening room, complete with red velour walls. "The house is so big, my wife and I joked that for a vacation we could just move upstairs for a week." When his secretary bet him he couldn't get into the MBA program at the University of Texas, he enrolled, and now shows up at school in his Ferrari, if not in a chauffeured limousine. "I have a blast spending money," he says, in case you couldn't tell.

Elsewhere, though, signaling wealth has become a high and sometimes subtle art. It's not considered cool for Wall Streeters to crow about the size of their bonuses. Indeed, last year one Philip Potter, an analyst at Morgan Stanley, agreed to resign the day after he bragged to the New York Times about his bonus, his new $3,500 Rolex, and his 50-inch television.

So you want subtle ostentation? Look at that distinguished investment banker over there. Why, one of the buttons on the sleeve of his handsome dark suit jacket appears to have become unraveled! But no. Upon closer inspection, we see that he has deliberately unbuttoned the first button on his jacket sleeve. That can mean only one thing! It's a very fine suit, probably $2,000 or more, so he must have gotten a big bonus! Says Susan Ratliff, a personal shopper at the prosaically named but very expensive New York clothing store Barneys, "The chic thing now is working buttonholes--meaning, buttons on the jacket sleeves can be opened. It's labor intensive and makes the suit expensive. To show them off, men will usually wear the first button open on their sleeves." And oh, my, the fabric! Made of wool, but of a kind with very fine threads known as super 120s (17.5 microns thick) or even super 150s (15.5 microns). A few thousand bucks more than your average suit, but it looks and feels great, and, hey, you're an alpha broker and you can afford it. Or how about a Brioni suit, made of cashmere and wool so soft it feels like a warm fog against the skin? Five thousand smackeroos? You can make that in an afternoon.

The subtle semiotics of power suits are understood even in the hinterlands. A mere Armani won't do anymore for Bob Berry, a managing director in Little Rock for the regional brokerage Morgan Keegan. "I only buy the best," says Berry, who adds that his last few years trading debt issues have been very, very good. Armanis go for just $800 to $1,200, he sniffs. He now prefers Oxxford suits, which cost up to $2,300 ("I don't look good in Brioni," he explains). He buys several each year at Baumann's, a posh local retailer.

You've got a Rolex watch? How nice. But how many "complications" does it have? You know: Does it show the phases of the moon, high tide, elapsed time, date, seconds, Martian and Venusian time? Is it self-winding, all with gears and springs (no batteries allowed), and does it still lie on your wrist thinner than a postage stamp? "The luxury watch business is phenomenal, with same-store sales up 10% a year for the past ten years," says Anthony J. D'Ambrosio, executive vice president for New York-based Tourneau, a collection of watch stores that bills itself as the world's largest. The average age of buyers has dropped in the past five years from the late 40s to the mid-30s.

Why are expensive watches so popular? D'Ambrosio won't attribute it just to flush investment bankers, though he notes that the Wall Street bonus season is good for business. He goes on at some length about people appreciating craftsmanship, etc. But the real purpose of an expensive watch is to let other people know how rich you are. "You can't take a van Gogh to the boardroom and show it off," D'Ambrosio points out. "The car you drive won't help you when you're before the co-op board trying to buy an apartment." A good watch can even help you get a seat in a sold-out restaurant. (You mean, a maitre d' notices what watch you wear? asks an astonished Timex wearer. "Oh, they get it," D'Ambrosio assures. "The good ones in the European restaurants do.")

How do Wall Street's moneyed young know so much about expensive goodies when they spend most of their day staring at Bloomberg terminals? Funny you should ask. Daniel Magnus, head of luxury marketing for Bloomberg, recognized that traders are at their desks 12 hours a day but actually trade for only four to six hours. What to do with all that spare time, money, and restless energy? Type in SHOPGO on your Bloomberg and you'll see ads for jewelry, cars, furs, even private jets. Magnus says one trader saw a ten-carat diamond he wanted for his wife, and jeweler Harry Winston sent a limo down to bring him to the showroom. According to Magnus, another guy in London bought an 18-inch strand of black South Sea pearls for a barmaid. A $75,000 impulse purchase.

As we all know, however, any boob can buy a $100,000 wristwatch. If you really want the world to know you've arrived, you simply must find a peaceful, remote village, long populated by quiet old money, buy a nice old house, tear it down, and put up a blimp-hangar-sized mansion in its place. That, at least, is how the old-timers in New York's eastern Long Island resort towns of the Hamptons view the Wall Street barbarians crashing their gates.

Wall Street's invasion of the Hamptons has been going on for years, and quaint organizations like the Ladies' Village Improvement Society in East Hampton have been trying to stem the worst predations. Joan Denny, head of the improvement society, says the pace of massive building has picked up in the past five years. "It's like a contest to see who can build the biggest."

Even the local real estate brokers seem surprised. It used to be that people made money the old-fashioned way, says Frank Newbold, manager of Sotheby's East Hampton real estate office. "They inherited it." But now, Wall Street money is driving much of the demand for houses. "When the market is up on Friday, the phones start ringing here on Saturday," says Newbold. No one house-hunts in East Hampton for humility's sake. "The last thing they are looking for is shelter for themselves and their family," he says. "It's strictly about rewarding yourself." When the agency tried advertising one property as possessing "a lovely old house," it was virtually ignored. When Sotheby's changed the ad to "the largest property in the estate area," it got dozens of calls.

It's not much different on those hallowed islands, Nantucket and Martha's Vineyard, off the coast of Massachusetts. Houses there, too, were the object of frenzied buying and building back in the 1980s and are again now. Paul Adler, an established Vineyard builder, says there's a different feel this time around. "In the '80s, people were buying houses on speculation. They took on a lot of debt, figuring the house would rise in value and they could make a profit." This time around, though, buyers tend to be Wall Streeters or executives who have cashed in huge stock options and plan to keep what they buy for years. In some cases his customers have been told by their accountants to cash in their stock and buy a house to lock in their gains. "I'm seeing someone today who's told me he has to spend $3 million this week," he says.

Fancy cars and fancy clothes are disdained on the island, but nobody is bashful about building an 8,000- or 9,000-square-foot single-family home. "They call them trophy houses," Adler says. Taste? Who cares? "They have such easy money they just say, 'I want the best.' One guy had me put in a $6,000 stove. He never uses it. He eats out all the time."

Say what you will about the bull market's beneficiaries, they do appreciate culture. The thinking seems to be that if a little music is good, a lot must be great. In prosperous Greenwich, Conn., Mark Risi of Performance Imaging installs whole-house sound systems. The average cost is $250,000 per home, he says, and he has 25 projects in the works. Many of his customers are athletes and Hollywood types, but most are from Wall Street. Business has doubled in the past three years.

It's the same when it comes to the visual arts. "People are buying paintings faster than I can frame them," says Vance Jordan, owner of Vance Jordan Fine Art gallery in New York, which specializes in six- and seven-figure paintings by traditional American artists. Many new customers are people with Wall Street bonuses or executives with lots of options. "I've been in business for 23 years, and last year was my best. And halfway through this year, I've already doubled my sales." Business boomed in the late '80s too, he says, but back then people bought paintings expecting them to rise in value. "Now people are buying for power and status, and sometimes even love." Jordan tells of one customer who, eager to decorate his big new home, bought several dozen paintings in less than a month. "The art market has turned less discriminating lately," he says. "People seem less concerned about quality and condition."

For all Wall Street's swagger, brokers and investment bankers weren't the only ones made rich by the delirious market of the '90s. There are thousands of worthy folks who started a successful company that later went public or who rose to the top of a big corporation that was acquired and then popped open their golden parachutes. One such beneficiary is Christopher Ruisi, 49, the former president of US Life, a big insurance company that was acquired last year by American General. I found him floating on a new 55-foot Viking sport-fishing yacht in Nantucket harbor. In the hot stock market, all US Life shareholders got top dollar for their shares when the company was bought, he says. Ruisi left work, sold the 50-foot Viking he had bought the year before, and got the even bigger one. "I wrestled with the purchase," he says. "You look at the stock market and you know that what goes up can come down." But the payout from US Life covers his material needs and college for his three kids, and he concluded that even if the market crashed he wouldn't have to sell the boat. Besides, he simply "fell in love" with the bigger boat. He paid cash, of course. Over a million.

While any properly optioned and 401(k)'d executive has reason to bless the stock market, the synergy between enterprise and equities flows thickest in Silicon Valley. In the past five years, more than 3,800 companies in the U.S. have gone public, raising $245 billion. Over a third of those millionaire-making deals involved technology companies.

"If the founders are young and this is their first windfall, they can spend it quite quickly," says Jean Blomberg, head of executive banking at Silicon Valley Bank, which often lends to promising small companies. "First they want a house, then a car. Ferraris are popular, particularly red. Then it's a second home, a getaway in Carmel or Lake Tahoe."

Unfortunately for many of the newly rich in Silicon Valley, even a few million bucks doesn't buy a drop-dead house in the more sought-after suburbs, where land costs a couple million per acre and thousands of IPO millionaires are all hunting for a place to live. Still, there's one thing you can do to show how big you've made it: Buy your neighbor's half acre, tear down his house, and commit horticulture. Steve Jobs, for example, is growing apricots in Palo Alto, which is what they used to do in Silicon Valley before the techies arrived. Backyard vineyards are especially common. Woodside Vineyards in Woodside, Calif., will come and plant grapevines on your lot, harvest the grapes, and swap you wine for the crop--probably the most expensive wine you will ever drink.

Once you've got your housing and wine supply squared away, you can attend to the real point of becoming wretchedly wealthy: satisfying your every desire. Your first call might be to a San Francisco-based outfit, LesConcierges. The firm caters to wealthy executives and post-IPO dropouts and, according to vice president Valerie Raszka, will arrange literally anything "as long as it isn't illegal, unethical, or unkind." Too busy running your software company to arrange a first date with that sweetie pie in accounting? Retain a personal assistant from LesConcierges who will set up the date for you, right down to picking out flowers for the dining table. Need some diversions while traveling? For one itinerant investment banker, LesConcierges arranged a dinner in Dallas, baseball tickets and a personal trainer in Seattle, and an Italian suitmaker in New York.

And that's just the routine stuff. Raszka says LesConcierges agents have traveled to London to track down a pair of polka-dot socks a client remembered seeing in a store there. They've dispatched a tiger and a World War II tank, among other conversation starters, to various parties, and sent a beekeeper to fix one customer's backyard bee infestation while he took off for the weekend. One client in Ohio wanted to serve his wife a dessert they'd had at a restaurant in Florida. The firm hired a local chef who got the recipe from the restaurant and went to the couple's home to make the dish. Says Raszka: "Our economy has created so much wealth that people can ask for service on a silver platter. If you've got $100 million and want to play, we'll help you."

Sheesh! What is going on here? The vast amounts of easy money being made and spent worry even some of the very rich, like Steven Chrust, a Wall Street securities analyst who started a telecommunications company five years ago, now with a market value of $1.9 billion. "Sometimes I'm afraid I will wake up and discover that none of this was ever there," he admits.

And yet, here is a scary thought: Could it be that the wise and sober-minded ones are the Wall Street bonus babies and the Silicon Valley millionaires, who know this is the time to cash out and spend, while the rest of us are sitting there glassy-eyed, dazzled by the run-up in the market? Chrust, for all his doubts, is spending $200,000 to jack up the foundation of his $1.5 million house on Long Island Sound, at which point he'll begin some real renovations.

You know the old Wall Street saying, "Bulls make money, bears make money, and pigs get slaughtered." Who are the real sausages-in-waiting here?

REPORTER ASSOCIATES Lixandra Urresta, Carol Vinzant, and Rajiv M. Rao