How overvalued are stocks?

CNBC's Alex Rosenberg asked: Just how overvalued are stocks? He looked to Jeremy Siegel and Robert Shiller for answers.

... In a Wednesday interview on CNBC's "Trading Nation," Shiller, a Yale University professor of economics, said that the market "hasn't been this overvalued except for a couple times in history—around 1929, around 2000."

Shiller is referring to the cyclically adjusted price-earning (or CAPE) ratio...

... Jeremy Siegel, a professor of finance at the University of Pennsylvania's Wharton School ... says the CAPE ratio is now giving off a false signal.

... "We are in a low interest rate world. We shouldn't use a 10-year lagging average now, especially with the growth that we're seeing."

There is a problem in comparing Shiller with Siegel.

Robert Shiller is probably most famous for writing the book Irrational Exuberate in 2000 that suggested that the stock market was overvalued just as it hit a peak.

Jeremy Siegel is probably most famous for writing the book Stocks for the Long Run that showed that stocks have returned an average of 6.5 percent to 7 percent per year after inflation over the last 200 years.

In other words, while Shiller has shown some prescience in forecasting for the short to medium term, Siegel is only known for his forecast for the very long term.

John Hussman did a thorough analysis of market valuation in his article last week "Valuation Breakevens" and concluded that "current valuation extremes present a hostile combination of weak prospective return and steep risk".