The S&P is still overvalued by historical standards.
http://www.multpl.com/I know you're specifically talking about financials but for a bit broader spectrum, there's the chart. Had you been long financials yesterday and today you would have gave most of that gain back. Had you been short a few weeks ago you could've easily surpassed those gains. Hindsight is nice like that.
I'll give you that the banks are better capitalized now than in 2008. I'm assuming we're talking about US banks. But the US is still on the cusp of a recession and soverign default is a very real concern for MULTIPLE European countries. That's enough to bring everything down, financials (as well as small cap, biotech, etc.) will be hit the hardest.
I said it before on this board, the only bank I'm really looking at right now is WFC. And I think it will go cheaper so I'll wait. Then again I could be wrong, afterall, only one person on this board is apparently qualified to understand the stock market.
I agree with sentiment regarding the financial's uncertainty, however your statements regarding the P/E ratio of the S&P looks inaccurate. The Wall St. Journal reports the S&P P/E at 13.57 (a good amount lower than the 16.5 historical average).
Of course, all that really matters is if the current "E" will go down from here or not, so P/E is a pretty poor indicator of value during recessions.