5/30/2000
Alan Greenspan coined the phrase "irrational exuberance" in a 1996 speech, and it quickly caught the attention of the media, the markets and just about anyone who pays attention to investments in today's economic boom. Yale economist Shiller has adopted the phrase as an appropriate title for his new book. It's a cautionary tale in which he argues that our current market-driving success stories are akin to runaway Ponzi schemes where a first round of investors are paid off handsomely by a next larger round, encouraging further investment before the observance of any real returns. Through the new field of behavioral finance Shiller applies economics, history, sociology, and psychology to create a book that is well-written, broadly interesting, and worth hearing out.