READ BOOK ♴ Irrational Exuberance: Revised and Expanded ♿

READ BOOK ♠ Irrational Exuberance: Revised and Expanded ♩ Meilleur E Book, Irrational Exuberance Revised And Expanded Auteur Robert J Shiller C Est Tr S Bien Et Devient Le Sujet Principal Lire, Les Lecteurs Sont Tr S Takjup Et S Inspirent Toujours Du Contenu Du Livre Irrational Exuberance Revised And Expanded, Essai De Robert J Shiller Est Maintenant Sur Notre Site Web Et Vous Pouvez Le T L Charger En Vous Inscrivant Qu Est Ce Que Tu Attends S Il Vous Pla T Lire Et Faire Une Remise Pour Vous This reviewer remembers having read the first edition of this book back when it first came out in either 1999 or 2000, just before the stock market crash of 2000 2001 It did a very good job at providing historical perspective regarding long term values in the stock market It, correctly, pointed out that the stock market was overpriced and that a decline would be reasonable to expect And so it happened.Since then, bubbles have also burst in the housing market worldwide as well as the stock markets In addition, commodity markets have taken on many of the speculative characteristics of equity and housing markets, characteristics that they have not had, at least to the extent of the equity and housing markets, in the past Bubbles in these markets were not discussed in the first edition of the book For this reason this reviewer purchased this edition of Dr Schiller s book to obtain historical perspective on the housing markets, equity markets since 2000 and commodity prices The book, in short, provides very good historical perspective on the first two of these housing and equity markets but, unfortunately, not too much regarding commodity markets It discusses long term trends and cyclical bubbles in their historical context For this reason alone this book should be read by serious investors and students of both economics and finance As Aristotle once said A man with no perspective has no value.In addition to providing historical context in regard to these markets, the book also does an excellent job at explaining, through the lens of economic psychology, why bubbles occur The primary reason is that there is human interaction, that taken on the aggregate, influences the market as a whole Factors influencing this psychology, that are discussed in some depth in the book about a chapter each , include not all inclusively the optimism usually unfounded induced by new technologies what Dr Schiller refers to as New Era Economic Thinking , the role of the news media and the de regionalization and globalization of these markets housing markets historically were only regional within nations and equity markets, in general, were not global this has changed since the mid 1990s though Dr Schiller does a very good job at showing how these primarily psychological factors have played a very important role in inflating and deflating bubbles He does an excellent job at showing how these psychological factors have played a important role that economic fundamentals , as posited by the rational expectations school of macroeconomics and finance, are not able to explain credibly Not that there are no other books available on the subject John Auther s, writer for the Financial Times, does an excellent job at analyzing the role of psychological factors in bubbles albeit only those in equity markets and with the emphasis being on institutional players in these markets in his The Fearful Rise of Markets Global Bubbles, Synchronized Meltdowns, and How To Prevent Them in the Future Dr Schiller though drills down into psychological numerically as well as analyzing these in detail He also provides quite a few analogies that clarify his ideas i.e., providing context in terms of research that shows how investor psychology very much mimics the spread of diseases.All and all the book does an excellent job at examining these psychological factors Where the book somewhat falls short, however, is in the solutions provided the final chapter of the book Many of the solutions provided by Dr Schiller do not seem very capable of reducing the growth of bubbles For example, he cites the use, by monetary authorities, of gently higher interest rates He also mentions that persons in responsible positions point out the existence of bubbles to the public Both of these, at least to this reviewer, seem particularly weak Dr Schiller also, importantly, posits that hedging and shorting can also play a very important role but, simultaneously, he also points out the weaknesses in these i.e., the market financial instruments may not exist, shorting itself may raise prices as to do this some investors i.e., those offering the shorts for sale must hold the relevant securities and this can have the effect of raising their prices, etc These factors greatly reduce the ability of short selling and hedging s ability to mitigate the size of bubbles.Despite the problems cited in the last paragraph above, the book s historical perspective on equity and housing markets and its serious examination of psychological factors relevant to bubbles make it a very important book to read especially for serious investors and students of economics and finance.