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Commentaries by Robert J. Shiller

Sep. 20, 2013
The Best, Brightest, and Least Productive?
NEW HAVEN – Are too many of our most talented people choosing careers in finance – and, more specifically, in trading, speculating, and othe…
Newsart for Bubbles Forever
Jul. 17, 2013
Bubbles Forever
NEW HAVEN – You might think that we have been living in a post-bubble world since the collapse in 2006 of the biggest-ever worldwide real-es…
Newsart for Austerity and Demoralization
May 31, 2013
Austerity and Demoralization
NEW HAVEN – The high unemployment that we have today in Europe, the United States, and elsewhere is a tragedy, not just because of the aggre…
Newsart for Debt-Friendly Stimulus
Mar. 20, 2013
Debt-Friendly Stimulus
NEW HAVEN – With much of the global economy apparently trapped in a long and painful austerity-induced slump, it is time to admit that the t…
Newsart for A Metaphor for Obama
Jan. 10, 2013
A Metaphor for Obama
NEW HAVEN – As US President Barack Obama begins his second term, he needs a simple way to express his vision and policies for the economy – …
Newsart for A Man Without a Plan
Nov. 11, 2012
A Man Without a Plan
NEW HAVEN – During the United States’ recent presidential election campaign, public-opinion polls consistently showed that the economy – and…
Newsart for The Narrative Structure of Global Weakening
Sep. 20, 2012
The Narrative Structure of Global Weakening
NEW HAVEN – Recent indications of a weakening global economy have led many people to wonder how pervasive poor economic performance will be …
Newsart for Bubbles without Markets
Jul. 23, 2012
Bubbles without Markets
NEW HAVEN - A speculative bubble is a social epidemic whose contagion is mediated by price movements. News of price increase enriches the ea…
Newsart for My Speech to the Finance Graduates
May 22, 2012
My Speech to the Finance Graduates
NEW HAVEN – At this time of year, at graduation ceremonies in America and elsewhere, those about to leave university often hear some final w…
Newsart for The Euro’s Imagined Community
Mar. 18, 2012
The Euro’s Imagined Community
NEW HAVEN – Great significance – probably too much – has been attached to a possible breakup of the eurozone. Many believe that such a break…
Newsart for Does Austerity Promote Economic Growth?
Jan. 18, 2012
Does Austerity Promote Economic Growth?
NEW HAVEN – In his classic Fable of the Bees: or, Private Vices, Publick Benefits(1724), Bernard Mandeville, the Dutch-born British philosop…
Newsart for The Neuroeconomics Revolution
Nov. 21, 2011
The Neuroeconomics Revolution
NEW HAVEN – Economics is at the start of a revolution that is traceable to an unexpected source: medical schools and their research faciliti…
Newsart for The Great Debt Scare
Sep. 23, 2011
The Great Debt Scare
NEW HAVEN – It might not seem that Europe’s sovereign-debt crisis and growing concern about the United States’ debt position should shake ba…
Newsart for Debt and Delusion
Jul. 21, 2011
Debt and Delusion
NEW HAVEN – Economists like to talk about thresholds that, if crossed, spell trouble. Usually there is an element of truth in what they say.…
Newsart for Economy, Insure Thyself
May 27, 2011
Economy, Insure Thyself
NEW HAVEN – The basic principle of financial risk management is sharing. The more broadly diversified our financial portfolios, the more peo…
Newsart for Bubble Spotting
Mar. 22, 2011
Bubble Spotting
NEW HAVEN – People frequently ask me, as someone who has written on market speculation, where the next big speculative bubble is likely to b…
Newsart for A People’s Economics
Jan. 20, 2011
A People’s Economics
NEW HAVEN – We are in the midst of a boom in popular economics: books, articles, blogs, public lectures, all followed closely by the general…
Newsart for Shorting Fiscal Consolidation
Nov. 18, 2010
Shorting Fiscal Consolidation
NEW HAVEN – Real long-term interest rates – that is, interest rates on inflation-protected bonds – have fallen to historic lows in much of t…
Newsart for Seven More Years of Hard Times?
Sep. 20, 2010
Seven More Years of Hard Times?
NEW HAVEN – Much of the talk emerging from the August 2010 Jackson Hole Economic Symposium, attended by many of the world’s central bankers …
Newsart for Who Should Safeguard Financial Stability?
Jul. 22, 2010
Who Should Safeguard Financial Stability?
NEW HAVEN – Central bankers around the world failed to see the current financial crisis coming before its beginnings in 2007. Martin Čihák o…
Newsart for How Nutritious Are Your Investments?
May 13, 2010
How Nutritious Are Your Investments?
NEW HAVEN – Those labels that you see on packaged foods listing their ingredients and nutritional values had their beginnings in an internat…
Newsart for A Crisis of Understanding
Mar. 12, 2010
A Crisis of Understanding
NEW HAVEN – Few economists predicted the current economic crisis, and there is little agreement among them about its ultimate causes. So, no…
Newsart for Engineering Financial Stability
Jan. 18, 2010
Engineering Financial Stability
NEW HAVEN – The severity of the global financial crisis that we have seen over the last two years has to do with a fundamental source of ins…
Dec. 9, 2009
A Sustainable Housing Recovery?
NEW HAVEN – Volatility in the housing market has long been known, but until now it has never been visible in so many places around the world…
Newsart for The Ghost in the Recovery Machine
Nov. 13, 2009
The Ghost in the Recovery Machine
NEW HAVEN – The International Monetary Fund’s October World Economic Outlook proclaimed that, “Strong public policies have fostered a rebo…
Sep. 14, 2009
Reinventing Economics
NEW HAVEN – The widespread failure of economists to forecast the financial crisis that erupted in 2008 has much to do with faulty models. Th…
Newsart for Unlearned Lessons from the Housing Bubble
Jun. 16, 2009
Unlearned Lessons from the Housing Bubble
NEW HAVEN – There is a lot of misunderstanding about home prices. Many people all over the world seem to have thought that since we are runn…
Newsart for Story Time for the World Economy
May 13, 2009
Story Time for the World Economy
NEW HAVEN - Since hitting bottom in early March, the world’s major stock markets have all risen dramatically. Some, notably in China and Bra…
Newsart for Winning the Confidence Game
Mar. 13, 2009
Winning the Confidence Game
NEW HAVEN – On April 2, the G-20 will hold a summit in London to discuss what we may hope will be an internationally coordinated plan to add…
Jan. 15, 2009
Recession Insurance
NEW HAVEN – The Chief Economist of the International Monetary Fund, Olivier Blanchard, and several IMF economists have proposed in a recent …
Dec. 1, 2008
The Great Real Estate Bust of 2008
NEW HAVEN – What brought on the collapse of home prices in 2008 that is the root of the financial crisis now enveloping much of the world? …
Nov. 13, 2008
Reviving the Animal Spirits
NEW HAVEN – The world’s fundamental economic problem today is a staggering loss of business confidence. Commercial banks, investment banks, …
Sep. 9, 2008
Moral Dilemmas for Fannie and Freddie
NEW HAVEN – The United States government’s takeover of mortgage giants Fannie Mae and Freddie Mac constitutes a huge bailout of these instit…
Jul. 15, 2008
Images of Scarcity
NEW HAVEN – Could the television image we’ve all seen of the Greenland ice cap crumbling into the ocean because of global warming somehow – …
May 19, 2008
Insuring Against Insurance
NEW HAVEN -- Most people who save and invest do so for their entire lives. But most of the institutions upon which they rely for the…
Mar. 17, 2008
Has Financial Innovation Been Discredited?
MOSCOW – Skeptics of financial liberalization and innovation have been emboldened by the crisis in the world’s credit markets that erupted i…
Jan. 18, 2008
Automatic Savers
People are fascinated by wealth. They enjoy watching the wealthy, savoring the thought of their fine homes, luxurious vacations, fancy cars,…
Nov. 15, 2007
Imagining Recession
The world’s housing, oil, and stock markets have been plunged into turmoil in recent months. Yet consumer confidence, capital expenditure, a…
Sep. 17, 2007
Bubble Trouble
The future of the housing boom, and the possible financial repercussions of a substantial price decline in coming years, is a matter of moun…
Aug. 15, 2007
Stock Markets’ Fear of Falling
NEW HAVEN -- The sharp drop in the world’s stock markets on August 9, after BNP Paribas announced that it would freeze three of its …
Jul. 16, 2007
The Liquidity Puzzle
We increasingly hear that “the world is awash with liquidity,” and that this justifies expecting asset prices to continue rising. But what d…
Jun. 15, 2007
Exuberant Brazil
Brazil’s stock market, as measured by the inflation-corrected Bovespa index, has more than quadrupled in value since President Luis Inácio L…
May 17, 2007
The Myth of “Superstar Cities”
In a much-talked-about recent paper entitled “Superstar Cities,” economists Joseph Gyourko, Christopher Mayer, and Todd Sinai argue that suc…
Apr. 17, 2007
Taming “Speculative Capitalism”
Nicolas Sarkozy, the leading contender in the French presidential election, recently lashed out against what he called “speculative capitali…
Mar. 16, 2007
Markets vs. Market Psychology
The sharp one-day drop in the Chinese stock market on February 27 apparently had an enduring negative effect on major stock markets around t…
Feb. 15, 2007
Inequality and Its Discontents
Leaders around the world seem to be convinced that inequality and lack of broad participation in economic growth, if allowed to persist, wil…
Jan. 15, 2007
Investing in the Poor
Most people believe that the world of finance has no concern for the little guy, for all the low- and middle-income people who, after all, c…
Dec. 15, 2006
The New Cosmopolitans
As globalization proceeds, with the help of ever-faster communications, faster travel, and more powerful multinational corporations, a new, …
Nov. 15, 2006
Ivy League Investors
Yale University, where I teach, has entrusted its endowment portfolio to one man, David Swensen, for over 20 years. During this period, the …
Oct. 17, 2006
The Rising Wealth of Nations
The new Penn World Table, Version 6.2, comparing standards of living across countries, has just been released. The latest figures are for 20…
Sep. 15, 2006
What Are Homebuyers Thinking?
Many places around the world have been in a housing boom since the late 1990’s. As I argued last year, in the second edition of my book Irr…
Aug. 22, 2006
Thrifty China, Spendthrift America
The saving rate in China is the highest of any major country. China’s gross saving rate (the percentage of GDP that is not consumed immediat…
Jul. 18, 2006
The Gospel According to Gates
Bill Gates and Warren Buffett, the richest and second richest person in America, and perhaps the world, are often described as admirers of A…
Jun. 12, 2006
What News Is Moving the Markets?
Stock markets in much of the world have shown sharp cumulative declines since around May 10, with most of the drop occurring in the two-week…
May 11, 2006
Career Counseling for the Twenty-First Century
As a college professor, I hear a lot of career concerns. As my students prepare to enter working lives that will last 50 years or more, prac…
Apr. 20, 2006
The Global Home
Homes are the most local of investments, rooted to a particular place like a tree, and thus thriving or withering in response to local econo…
Mar. 21, 2006
Whatever Happened to Wage Insurance?
A lot of public attention and worry nowadays surrounds the new risks that globalization and information technology create for our wages and …
Feb. 22, 2006
Insuring the Worst
In the nearly six months since Hurricane Katrina destroyed half of New Orleans, many storm victims’ expectations of help have been dashed, c…
Jan. 13, 2006
Is Bernanke Ready?
Ben Bernanke, the nominee to replace Alan Greenspan this month as Chairman of the US Federal Reserve Board, is a highly capable economist wh…
Dec. 27, 2005
Let’s Get Real About Money
Throughout the world, people suffer from a serious perception error that has inhibited them from taking concrete steps to protect themselves…
Nov. 24, 2005
Home Sweet Second Home
Whenever I speak at finance and economics conferences around the world, I find that a great conversation starter with the spouses of the mid…
Oct. 31, 2005
Feeling Rich
Who is richer, you or I? As long as we both have enough to live comfortably, it shouldn’t matter much. Many of us try not to let it matter. …
Sep. 26, 2005
Do Low Interest Rates Ensure High Asset Prices?
Asset prices– stocks, commercial real estate, and even oil – are, historically, at high levels around the world. Although history is often a…
Aug. 23, 2005
Is China’s Economy Overheating?
The Chinese economy has been growing at such a breathtaking annual pace – 9.5% in the year ending in the second quarter of 2005 – that it is…
Jul. 25, 2005
The Culture of Entrepreneurship
Governments around the world want to promote entrepreneurship. Though most business start-ups will never amount to much, each little company…
Jun. 28, 2005
Managing Risk to Save the Poor
The G-8 finance ministers have agreed to cancel $40 billion of debt owed by eighteen of the world’s poorest countries. This is a triumph for…
May 31, 2005
Stock Market Fantasies
Historically, the stock market has performed well. In his celebrated 2002 book Stocks for the Long Run , Jeremy Siegel shows that the Ameri…
Apr. 27, 2005
Live Long and Prosper
Living a long time is one of our deepest wishes, and medical and economic progress offers the hope that it will be fulfilled. Some scientist…
Mar. 29, 2005
Butlers, Bakers, and Capitalists?
The communist revolution that spanned the nineteenth and twentieth centuries was about concentrating government ownership of capital. Then, …
Feb. 25, 2005
Create Growth-Linked Bonds
A year ago, at the Summit of the Americas, 34 western hemisphere heads of state agreed to promote the creation of government-issued growth-l…
Jan. 25, 2005
Can We Insure against Tsunamis?
Most of the discussion surrounding how to respond to Asia’s tsunami disaster has focused on government relief programs and official schemes …
Dec. 20, 2004
Betting the House
Homeowners around the world effectively gamble on home prices. Their risks today are often big due to real estate bubbles in such glamour ci…
Nov. 19, 2004
Labor in a World of Financial Capitalism
The traditional hostility between labor unions and the world of finance should not obscure their common interest in using financial tools in…
Oct. 26, 2004
Are We Running Out of Oil (Again)?
Oil prices are now running well above $50 a barrel, partly owing to short-run supply shocks, such as the Iraq conflict, Nigerian labor dispu…
Sep. 29, 2004
Are Housing Prices a House of Cards?
The first big city to boom was London, starting around 1996. Boom mentality spread to Los Angeles, New York, and Sydney around 1997, to Pari…
Aug. 23, 2004
Fear and Loathing in the First World
Within the last few years, people throughout the world's most advanced economies have become acutely worried about the economic prowess of C…
Jul. 27, 2004
The Electronic Money Revolution
Most journalistic accounts of the new forms of electronic money misleadingly spin the story as the emergence of yet another convenience for …
Jun. 22, 2004
Will Rising Interest Rates Torpedo Stock and House Prices?
Interest rates around the world are poised to rise. Short-term rates have gone so low since the worldwide recession of 2001 - 1% and 2%, res…
May 24, 2004
Making a Market for Scientific Research
Scientific advances are the fundamental cause of economic progress, and yet many nations often apparently hope to piggyback on discoveries m…
Apr. 28, 2004
The Political Stock Market
Many economic and financial analysts complain that emerging countries' stock markets are often heavily manipulated by their governments and …
Mar. 16, 2004
The Machine That Ate Jobs
Insecurity about jobs is a defining characteristic of our age. Two worries arise most often: globalization, which makes jobs migrate to poor…
Feb. 6, 2004
Saving a World that Doesn't Save
Around the world, social security and health care are today's hottest economic issues due to the rising dependency ratio : the proportion o…
Jan. 22, 2004
Wild about Risk
Most people do not feel the same impulse to go out and buy insurance, or diversify their investments, as they do to buy a sofa or new clothe…
Dec. 31, 2003
How Corrupt are US Capital Markets?
Why has the US stock market done so well in recent months--the Dow increased over 30% since its low on March 11, 2003, and closed above 10,0…
Nov. 20, 2003
Nurturing the Creative Roots of Growth
Governments all over the world try to encourage economic growth. But growth--with the high employment and rising living standards that polit…
Oct. 31, 2003
Learning Economic Dynamism
Why are some of the world's most advanced economies--France, Germany, Italy, and Japan--suffering stagnant growth and high unemployment? Mor…
Sep. 26, 2003
Is There a Bubble in Home Prices?
Around the world, newspapers trumpet a "housing bubble" about to burst. The Economist has run numerous cautionary articles with titles lik…
Aug. 30, 2003
Mexico's Labyrinth of Uncertainty
What makes countries grow is perhaps the most fascinating issue in economics, and one of tremendous political-indeed, geopolitical-importanc…
Jul. 31, 2003
The Real Risks of Deficits
Deficits are back--with a vengeance. America's government budget deficit now stands at $455 billion, 4.1% of GDP. Two years ago, the US pred…
Jun. 30, 2003
Will the Bond Bubble Burst?
Unless inflation drops much more, now is an ideal time to be a borrower and a bad time to be a lender or investor in long-term bonds. Indeed…
May 28, 2003
Democratizing Capitalism
Capitalism is the world's engine of growth. But its very dynamism--its "creative destruction"--tends to produce great uncertainties. Unsucce…