If we use a more appropriate inflation measure, Shiller's corrected CAPE looks like this:
UPDATE: The never boring Henry Blodget shows how to be wrong with Shiller in his article written in March 2010:
The S&P 500 is 2,107 now, a far cry from the March 2010 level of 1,160 which Blodget believed was seriously overvalued. Though it may sound like a heresy, yes, sometimes it's really different.
DISCLAIMER: Believe Nobel Prize-winning professors at your own peril.