According to historical averages, how much were stocks overinflated during the mid-late 1990s? How much of a bubble was there?
there probably isnt a factual answer for this. For instance, some people think stocks are still overvalued *now[i/].
Of course, you can look at historical averages, such as Price/Earnings, but these are also simplistic. But the only way you could have a “factual” answer.
I noticed that each year they say it drops another $2T & its been three years, so that would put your figure about $6T. Give or take a T 
The question itself is awfully broad.
There was a huge gold bubble in the mid-90’s, a biotech bubble in the mid to late 90’s, and of course the tech bubble we all know and love.
But while the tech stocks were seeing their day, almost all the other sectors were undervalued.
You also can’t estimate how overvalued it was by seeing where it drops to – because typical market behavior will have it move from overvalued to undervalued.
I guess the real answer is, since no one can tell you what the market is actually worth, you can never really have an answer to your question – only a myriad of opinions; and of course half of us will think it should go up, and the other half down.
At least half of us will be right!
One problem with asking about ‘value’ is that value is often in the eye of the beholder. In my opinion, most of those Ty Beanie Babies are over valued, yet people collect them and are willing to pay a premium over the original price when trading/collecting them, they obviously believe they are worth the value.
Of course, if we can talk about value of stock with respect to fundamental analysis, future earnings potential, P/E ratios etc. If I recall correctly, when such fundamental arguments were used to show that the hightech stocks were overvalued, the usual answer was ‘that was the old economy with the old rules, this is the new economy and the old rules don’t apply’. (My colleagues in hightech used to poo-poo me when I suggested that the stock prices were crazy and that I was moving some of my investments out of high-tech)