The S&P 500 is now trading near levels it hasn’t touched since the dot-com bubble, and Wall Street isn’t running scared, but adjusting.According to Yahoo Finance, strategists across the board are now questioning what counts as “normal” in this market. Valuations that once screamed danger are now being treated as the new standard, as the stock market remains driven by AI, megacap earnings, and investors chasing growth.Savita Subramanian, equity strategist at Bank of America, told clients this week that maybe it’s time to accept these high stock multiples as the new baseline. “Perhaps we should anchor to today’s multiples as the new normal rather than expecting mean reversion to a bygone era,” she wrote in a Wednesday note.Sam Stovall, chief investment strategist at CFRA Research, said that the S&P 500 trades at a 40% premium to its long-term forward average, but when measured over just the last five years, that gap drops to a high single-digit level. That five-year window coincides with the rise of tech giants, who’ve dominated both market cap and earnings.Powell shares his concern while strategists push backThe Federal Reserve is aware of the heat. Speaking last week, Chair Jerome Powell said markets look “fairly highly valued.” That drew comparisons to Alan Greenspan’s 1996 “irrational exuberance” speech, delivered more than three years before the bubble burst. Despite Powell’s caution, most strategists aren’t seeing this as a bubble.Sonali Basak, chief investment strategist at iCapital, said in a LinkedIn post Friday that investors shouldn’t try to time the top. She quoted Barry Ritholtz, chief investment officer at Ritholtz Wealth Management, who warned: “If you’re an investor trying to guess where the top is, your odds are very much against you.” He reminded readers that after Greenspan’s warning, the Nasdaq rallied fivefold before crashing.The idea that the stock market is overvalued has been around for years. But strategists are looking at earnings and seeing something different this time. Ed Yardeni, a veteran market analyst, noted in a Tuesday memo that while the S&P 500’s forward price-to-earnings ratio is now 22.8, it still trails the 25.0 high just before the 1999 meltdown.Yardeni also pointed to a key difference: during the original dot-com surge, tech and communication services stocks made up 40% of the S&P 500’s value but contributed just 23% of earnings. Today, they represent 44% of the index’s value and bring in 37% of earnings. That gap has narrowed, and to some, that makes today’s valuations more defensible.Goldman warns of melt-up risk heading into year-endGene Goldman, chief investment officer at Cetera Financial Group, said in an interview that 2025 has been a big year, but that doesn’t mean a crash is coming. “We do see some type of market pullback. … Maybe 3%, maybe 5%,” he told Yahoo Finance. But he quickly added that these dips could be buy-the-dip opportunities. He doesn’t expect a bear market unless a recession shows up, and right now, the economy looks too strong for that.Goldman cited strong GDP growth, resilient consumer spending, and large amounts of cash sitting idle as reasons stocks still have room to climb. The bigger risk, in his view, isn’t collapse, it’s the possibility of a melt-up, a surge caused by fear of missing out. “We do risk a melt-up where everyone jumps in and buys aggressively,” Goldman said.With earnings forecasts for 2026 looking solid and more rate cuts from the Fed expected, the stock market could stay expensive for a while. But if this is the new normal, strategists want investors to stop comparing it to the past and start understanding what’s really driving today’s valuations. Sign up to Bybit and start trading with $30,050 in welcome gifts