Compared with 2008, the market value of NASDAQ in 2000 was 6.6 trillion, while the market value of the housing market was 30 trillion, more than twice the GDP. Moreover, houses affect everyone, while the stock market only affects a part of people, so the bursting of the stock market bubble in 2000 had little impact on the real economy.
In addition, the current bubble level is far less than that in 2000. As can be seen from the figure below, the NASDAQ 100 forward PE reached 100 times that year, but now it is only 25 times.
Another perspective is S&P PE. The current PE looks similar to that before 2000, but I think the valuation axis of the entire stock market has moved upward. The reason is that interest rates have been declining consistently since 1980, which has led to an upward PE.
From another angle, we can look at the S&P dividen yield - 10-year Treasury bond rate. We can see that it is relatively high now compared to 2000, which means that the bubble is not as big as it was back then.
Conclusion: Although the current stock market valuation is not low, it is not particularly overvalued and has not reached the level of the bubble in 2000.
