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Irrational Exuberance
Robert J. Shiller

Book Description | Table of Contents
Preface | Chapter 1 [HTML] or [PDF format]


"Alan Greenspan faces long odds in trying to nudge the stock market to where he'd like it to go. The chairman of the Federal Reserve has argued that the buoyant market--by making Americans feel so much wealthier--has triggered a consumer spending spree that threatens inflationary wage pressures. The idea is to dampen spending and the ravenous appetite for stocks. Anyone who thinks this will be easy should read Irrational Exuberance, a new book by Yale University economist Robert J. Shiller. Beyond arguing that the present market is a 'speculative bubble,' Shiller contends that investor psychology is so given to herd behavior that it's almost impossible to manipulate or even influence. The market can 'go through significant mispricing lasting years or even decades'."--Robert J. Samuelson, The Washington Post

"Thus it is an event of some significance that Shiller has written a crystal-clear and tough-minded critique of the factors that have driven US stock markets to their current levels and called his book Irrational Exuberance. In it, he argues that Federal Reserve chairman Alan Greenspan had it exactly right when he uttered the famous phrase in a speech in 1996. The current high levels of the market don't represent a consensus judgment by a cadre of sober experts, says Shiller. Instead, today's market is sky high because of wishful thinking by millions of people, egged on by professionals in and around Wall Street whose incentives all run in the direction of the more the merrier."--David Warsh, Boston Globe

"Irrational Exuberance is likely to cause a stir. . . . Shiller illustrates how the current market is like a naturally occurring Ponzi scheme in which investors become promoters for the game after receiving initial payments with money taken from subsequent investors."--David Henry, USA Today

"Irrational Exuberance is not just a prophecy of doom. . . . [I]t is a serious attempt to explain how speculative bubbles come about and how they sustain themselves. . . . [Shiller's] arguments should . . . give pause to anyone who has money in the stock market."--John Cassidy, The New Yorker

"Shiller has written a crystal-clear and tough-minded critique."--David Warsh, Boston Globe

"Mr. Shiller's book offers a dose of realism. . . . [I]t presents a message investors would be wise to head: Make sure your portfolio is adequately diversified. Save more and don't count on double-digit gains of the past decades continuing to bail you out during retirement."--Burton G. Malkiel, The Wall Street Journal

"A counterweight to the plethora of get-rich-quick investment guides."--Library Journal

"So why have share prices soared so high in the past five years, taking market valuations past all historical records? Professor Shiller's answer, as the title indicates, is not encouraging. His message is: diversify now as much as you can, and batten down the hatches."--Diane Coyle, The Independent

"Irrational Exuberance is not billed as a personal finance book. But it is. You can agree or disagree with it. But you owe it to yourself to read it if you're investing, or contemplating investing, in inequities."--The Washington Post

"To appreciate just how high the S&P index is, read Professor Robert Shiller's excellent new book, Irrational Exuberance."--Steve H. Hanke, Forbes

"What set off this speculation and what feeds it? Shiller ranges widely his explanations, laying them out in the first 168 pages in easy-to-read, sometimes passionate prose. . . . [T]hose first 168 pages are must reading for anyone with savings invested in stocks."--Louis Uchitelle, New York Times Book Review

"[An] excellent new book. . . . If you want to preserve capital, unload most of your stocks and invest in government bonds."--Steve H. Hanke, Forbes

"A must-read . . . refreshing, well-reasoned . . . and very readable."--Michael P. Niemira, Barron's

"Likely to be the year's most-talked-about finance book. . . . You can agree or disagree with it. But you owe it to yourself to read it if you are investing in equities or contemplating doing so."--Fred Barbash, International Herald Tribune

"Shiller has provided an accessible guide to the usually impenetrable literature on financial markets, especially the American stock market."--Foreign Affairs

"Although its message may be unwelcome to many, this important book should be read by anyone interested in economics or the stock markets."--Rene M. Stulz, Science

"Informative and well-argued . . . A calm and reasonable antidote to today's euphoria."--Jeff Madrick, The New York Review of Books

"A modern classic of "serious" economics that demands to be read, and can be enjoyed, by the interested non specialist."--The Economist

"No one else has examined the behavior of the American investor in the 1990s with more authority or better timing."--Library Journal


"This is an excellent book by a distinguished scholar. It raises an issue of the utmost importance for the U.S. economy and presents a persuasive case that the U.S. stock market may be significantly overvalued. It is well written for a popular as well as a professional readership."--Michael Brennan, Anderson School of Management, University of California, Los Angeles

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File created: 4/21/2017

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