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Irrational Exuberance Paperback – May 9, 2006
Based on seven years of reporting from over a dozen countries, writer Tom Wainwright takes you on an extraordinary journey into the business of being a drug lord. Learn more.
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“A modern classic of ‘serious’ economics that demands to be read, and can be enjoyed, by the interested nonspecialist.” –The Economist
“A dose of realism that serious investors will ignore at their peril.” —The Wall Street Journal
“The point of Irrational Exuberance is not to help investors dump their houses before the current exuberance fades. It is to deepen our understanding of the events we are watching as one bubble gives birth to another.” —The International Herald Tribune
“Irrational Exuberance [is] a dazzling, richly textured, provocative book . . . offering a cogent statement of the bears’ view of events to come. Shiller is not merely a bear—he is a grizzly.” —BusinessWeek
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Top Customer Reviews
This begs the question of why a bubble emerged in the late 1990's. Shiller discusses several cultural factors such as the ever-higher profile of the stock market in the media, including the Internet.
This begs the question of how it is possible for so many people wrongly to be optimistic about stocks. Shiller cites many findings in psychology, such as Asch Conformity, to explain how people can listen to others against their own best judgement.
This begs the question of whether it could be Shiller who is irrational. Shiller examines and refutes the arguments that pundits have made to rationalize exuberance.
There are three audiences for this book, all of whom will find it threatening.
1. Ordinary investors. You will not want to read this book, because it asks you to confront an issue that you would be more comfortable avoiding. However, once you do dive into it, you will be rewarded with sober facts and analysis that you can use to resist the siren calls of pundits, brokers, and friends to buy into the bubble.
I can assure you that Robert Shiller did not write this book to make his own fortune. The book jacket says nothing like "five strategies to survive the bubble," although he does mention some conservative investment alternatives. There certainly is no endorsement from Suze Orman or any of the other best-selling gurus that he swiftly skewers.Read more ›
The combination of mass psychology and market prices is at the core of this book. For bubbles to happen, information flow is the key. Media plays a significant role in disseminating information and bubbles seem to have originated in recorded history after the advent of the print media. In recent times electronic media particularly the television and the internet play a significant role in speeding up bubble formation and also the reversals. Media needs a storyline and this story needs to be continued to retain customers on a daily basis. Stock market is the ideal place that offers an opportunity to try one's luck if a casino is far away. Backed by on-line dedicated news channels and internet trading, well, it is not surprising that we have day traders in herds. In such situations fundamentals like industry analysis and P/E ratios take a backseat as explained by the author.Read more ›
Of course the market has been a great place to stash your cash if you got in at the right time--in 1982, for example, at the very start of the longest-running bull market in history. But put your money there now at your own risk. Seventy-two percent of mutual fund managers believe that we're in a speculative bubble now, with the Dow, at 11,000, reaching for figures that far exceed the historic level which would put the rational figure at 6,000. Shiller would not be surprised if the Dow settled in at, say, 10,000--in the year 2020! And what's more, he'd not be astonished if the Dow sank to 6,000 in the near future.
I was convinced after reading Shiller. He has marshalled his facts in a carefully researched screed against following the sheep-like crowds and I have replaced the tens of millions I had invested in common stocks with far more secure, if less exciting, instruments.
Harvey S. Karten email@example.com
Most Recent Customer Reviews
A seminal work on investing. Highly recommended for anyone who wish to dabble in financial investments.Published 5 months ago by GeoAggie
Schiller does an exceptional job tying the less obvious aspects of our society and psychological shortcomings as easily influenced members of an "immediate gratification first"... Read morePublished 5 months ago by Winston E.
The book is exactly that I have expected.Published 5 months ago by José Eustáquio Moreira de Carvalho
It's a good book. Schiller talks about behavioral economics and how this affects the modern approach in economics investigation. Read morePublished 9 months ago by Jonatas
So well written and extremely well researched. I am much more confident in my ability to spot markets driven by euphoria or mass appeal after having read this.Published 9 months ago by Corenne T.
As pertinent today (26 March 2015) as when the words were first uttered.Published 10 months ago by Carl N. Knudson
It'd nearly a decade since this book, the 2nd edition of Irrational Exuberance, made its debut in 2005. A lot has happened since then in financial markets. Read morePublished 11 months ago by Great Faulkner's Ghost