The stock market is currently valued about as high as it was before the great depression, which was only second to the dot com bubble. So yes, a correction is expected and needed, and long overdue.
You say needed. Bit arent there massive detriment to the normal people when it does finally crash?
Why would it be a detriment? If anything it makes stocks cheaper and more affordable to everyone who isn't rich. Plus look at the "great recession" dip in 2008. In only a couple of years the stock market recovered to twice its pre-recession highs. The only people who should care right now are fund managers and people close to retirement, and they should already have been rebalancing their portfolios to lower risk securities.
Would it not lead to loss of jobs or liquidity in the market? Isnt that why we needed so many bailouts before? Also loss of loans to small businesses / individuals?
That has to do with bonds more than it does with stocks. Stocks have jack shit to do with the job market, debt, and the economy in general. But the yield curve IS starting to invert, which is inevitable at the end of an economic expansion. It's already been going on for 10 years, the longest on record, do you expect it to last forever?