How expensive are US equities?

How worried should equity investors be about valuation? The S&P 500 is trading at a forward P/E of 20.6, which is elevated compared to its 5-year average of 19.1 and 10-year average of 17.8. Moreover, the 10-year Treasury yield of 4.5% is becoming a more attractive alternative to owning stocks.

 
Here are the bull and bear cases. The full post can be found here.