From Ron Griess of The Chart Store we get this wonderful graphic demonstrating just how abnormal historically the last 15 years have been.  Valuations are now the best they have been in over 15 years which means long term expected equity returns are also looking more favorable, but there is clearly room for more downside if sentiment gets sufficiently bad.  Historically, the most real stock prices have dropped  from these valuation levels is 56% so be wary of painting too happy a face on the current situation.