NEW YORK (CNN/Money) - Remember irrational exuberance?

The first time most of us heard the term was in December of 1996, when Fed Chairman Alan Greenspan used it in a speech. It prompted a little worry among Wall Streeters at the time, but just a few days later it was off to the races.

Justin Lahart, senior writer at CNN/Money, talks about valuation levels and irrational exuberance. Play video (Real or Windows Media)

Considering all that happened after -- the big bubble and the big blowoff -- lots of investors wish they had listened to the Chairman back then. And some of them also wish that the Chairman had listened to his words as well, and done something to keep the markets from getting out of hand.

Nobody talks much about irrational exuberance these days -- things just don't seem silly like they did in March 2000. But with the recovery in the market, stocks are beginning to look at least as expensive as when Greenspan first breathed what will go down as his most famous words.

Look at forward price-to-earnings ratios, for instance. Back then the S&P 500 traded at about 16.2 times expected earnings. Now we're at 17.3. Or how about the P/E model developed by Yale professor Robert Shiller, which looks at how the S&P compares to its average annual earnings, under generally accepted accounting principles, over the past decade. Back then the Schiller P/E was about 28.8. Now it's 27.8.

And then there's the way another well-known curmudgeon, Warren Buffett, has looked at valuations -- by comparing the total market capitalization of U.S. public companies to Gross National Product. Based on Federal Reserve and Commerce Department data, that level came to 129 percent back in December 1996. Right now it looks like it comes to around 130 percent.

To be sure (as our friend the Chairman is fond of starting sentences), there are some big differences between what happened then and what's going on now. The biggest one is interest rates -- the yield on the 10-year Treasury is about 4.3 percent compared with about 6.3 percent in December 1996.

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On a comparative basis, you can see why investors should be more fond of stocks now than they were then. Yields will obviously rise if the bright economic future that equity investors envision comes true, but over the next year anywhere approaching 6 percent on the 10-year doesn't seem in the cards.

Still, with many measures putting stocks at late 1996 valuations, and lots of people talking about how the market is going to go higher still, investors need to at least think about what sort of levels they think are stupid. And if these levels get reached, they need to think harder about selling than they did last time.