- Paperback: 336 pages
- Publisher: Crown Business; 2 edition (May 9, 2006)
- Language: English
- ISBN-10: 0767923634
- ISBN-13: 978-0767923637
- Product Dimensions: 6.1 x 0.7 x 9.2 inches
- Shipping Weight: 12.6 ounces
- Average Customer Review: 229 customer reviews
- Amazon Best Sellers Rank: #215,035 in Books (See Top 100 in Books)
Enter your mobile number or email address below and we'll send you a link to download the free Kindle App. Then you can start reading Kindle books on your smartphone, tablet, or computer - no Kindle device required.
To get the free app, enter your mobile phone number.
Irrational Exuberance 2nd Edition
Use the Amazon App to scan ISBNs and compare prices.
"Children of Blood and Bone"
Tomi Adeyemi conjures a stunning world of dark magic and danger in her West African-inspired fantasy debut. Pre-order today
Customers who bought this item also bought
Customers who viewed this item also viewed
What other items do customers buy after viewing this item?
“Robert Shiller has done more than any other economist of his generation to document the less rational aspects of financial markets.” — Paul Krugman
“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
About the Author
Robert J. Shiller is the Stanley B. Resor Professor of Economics at Yale University. He is the recipient of the 2000 Commonfund Prize, awarded for Best Contribution to Endowment Management Research, for Irrational Exuberance. He is also the author of Market Volatility and Macro Markets, which won the 1996 Paul A. Samuelson Award.
Top customer reviews
There was a problem filtering reviews right now. Please try again later.
Will history repeat itself with this third volume? That is hard to say. In this latest edition, Professor Shiller updates his argument, and augments the text to reflect developments since the 2005 second edition. Of particular interest, he adds an important new chapter on the bond market, which many feel is also in bubble territory. The good news is that, while Professor Shiller says that returns in all asset classes are likely to be subpar for some years given today's elevated asset prices, the mood is less somber than in previous editions, and there are no warnings of imminent doom, as in previous editions. In particular, he does not see a classic "bubble" in bonds, due to the lack of "exuberance" -- prices for bonds are being bid up reluctantly by investors, he says, which is not the formula for a bubble. However, he certainly balances that somewhat comforting news with a realistic view of the risks that the current situation presents to investors and savers of all types, stocks, bonds, housing, and savings accounts. His main piece of advice to all Americans concerned about their financial future may be the most sensible piece of financial advice ever written: spend less, save more! Yes, we all know that, but when the winner of the 2013 Nobel prize says that, it really means something.
I find Professor Shiller's writing style highly enjoyable, not at all like most economics books. The plain-spoken style is smart, wry, and often witty, and there are almost no mathematical formulas, except in the occasional technical notes in back. The book also talks about a lot of factors that are intrinsically interesting to non-economists. For example, it has chapters devoted cultural factors in investing; the effects of the news media; "new era" economic thinking; psychological factors; psychological anchors for the market and herd behavior.
Professor Shiller ends by offering a lot of good, commonsense advice to both policymakers and investors, large and small. I highly recommend this book to anyone who wants to understand what's behind the current anxiety, turmoil, and hopes, for a brighter financial future for all Americans.
Oddly enough, both books were compelling and believable. The reasons that this is odd is mostly because one would think that they are diametrically opposed. The entire argument of Malkiel is that you can’t beat the markets consistently, so the best bet is to get into index. This is an acceptance of part of the efficient market hypothesis, where there is no free lunch and arbitrage opportunities disappear and are not predictable.
I can be into Shiller too because there is another part of the EMF that says that market prices are the right prices, so the value of the market is the true value of the market. If this is true there should never be any bubbles. You should also never be able to short sell anything unless you had inside information. But alas, the market can stay irrational longer than you can stay liquid. Bubbles do happen, in all markets and everywhere. Shiller got a bit lucky by having the first edition of this book come out at the point where the dot com bubble was right at the top. Those who had gone all in on technology were not as lucky. As Shiller examines. bubbles can and do happen.
So how can I reconcile the fact that the EMF is the tool I rely on for investing even though I have full knowledge that bubbles happen and massive dollar amounts are lost in them? I answer by saying that the markets are rational enough. Bubble happen, but it is hard to know when you’re in them and you can’t time them. The prominent economist who called the housing bubble beforehand are small in number. If they were calling it, they were dismissed as bearish or too heterodox. Too many people had failed to read their Kindleberger. This time wasn’t different and the bubble popped. Harder to know is when it will pop and at what level. That’s where the EMF works. When it pops, you’re going down with it, but so will everyone else. It makes me think of a couple of quotes. First, Keynes: “Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally,” and then Citi’s Chuck Prince approps the last bubble: “As long as the music is playing, you've got to get up and dance”. Sure, if you were in the main indices you lost half the value of your investments. Of course if you stayed in them you made them all back. Now imagine if you had put all your money into junior tranches of residential mortgage backed securities -- it seemed like a sure thing, but you would have ended up with nothing. It’s not perfect, but the market is efficient -- enough.