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Justin Fox

Robert Shiller's Bubble Vision

In the latest edition of his classic "Irrational Exuberance," the Yale economist cautions that no, he doesn't know what the market will do next.
On the lookout.

On the lookout.

Photograph: ChinaFotoPress/Getty Images

By this point one mainly reads Robert Shiller’s “Irrational Exuberance” for the prefaces. In the preface to the first edition, published in March 2000, the Yale economics professor argued that “the present stock market displays the classic features of a speculative bubble.” In the second, published in March 2005, he warned about “the enormous home price boom that many countries have been experiencing since the late 1990s.”

The third edition is out this month. This time Shiller expresses surprise that even “the bursting of the speculative bubbles that led to the 2007-9 world financial crisis” hasn’t really sobered us up.