This is a table from Barron's that shows how cheap or expensive the markets are. Right now, we're somewhere in between. Here's the S&P 500. The first number is latest week, the second column is the previous week and the third column is same week for the previous year.
S&P 500 Index
P/E Ratio 17.7 18.3 18
Earnings Yield (%)5.65 5.46 5.55
Earns $ 82.23 78.57 71.5
Dividend Yield (%)1.8 1.82 1.85
Dividends ($) 26.2 26.17 23.81
Market to Book 3.21 3.17 3.1
Book Value ($) 453.06 453.06 414.75
The PE ratio decreased slightly from the previous year, although we're still in the same ballpark. Notice the big move in earnings. This is the primary reason for the lack of increase in the PE ratio. Earnings are increasing about the same rate as stock prices.