Apr 25, 2025

Robert Shiller: Which scares you more, bears or bulls?

Robert Shiller

Today's oracle quote is especially relevant given this week's market turmoil. It comes from Robert Shiller, a level-headed realist who sees through many of the false assumptions made by investors and economists.

"After a stock market decline, people may perceive more risk than before when, in fact, the decline may have taken some of the risks out of the market."

– Robert Shiller

Who Is Robert Shiller?

Robert James Shiller is an American Nobel Prize winner, economist, Yale professor, and best-selling author.

I admire Shiller because he takes a sober, long-term, and fresh approach to studying the markets. His Shiller index of real estate prices, for example, was the first to measure the resale prices of the same, exact properties over time.

Shiller is considered to be perhaps the only person to have predicted both the dot-com bubble and the housing crisis of 2007-2008. And he was the first to describe the pre-2008 market with the now famous phrase, "irrational exuberance."

Shiller's is now widely respected. Earlier in his career, however, his colleagues told him he was “embarrassing" their institution (Yale) when he challenged the efficient market hypothesis. They told Shiller he was crazy to suggest that psychological factors and narratives play a significant role in asset pricing and the formation of speculative bubbles.

Sources say Shiller's net worth is $31.5 million. He has cofounded the Robert and Virginia Shiller Foundation, which has assets of $14 million. Shiller was born on March 29, 1946.

Learn More:

You can start with any one of Shiller's influential books. They are all excellent. His titles include:

• Irrational Exuberance

• Narrative Economics: How Stories Go Viral and Drive Major Economic Events

• Finance and the Good Society

• Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism (with George A. Akerlof)

• Phishing for Phools: The Economics of Manipulation and Deception (with George A. Akerlof)

Disclaimer: This newsletter is for informational purposes only and does not constitute financial advice. Please consult a qualified financial advisor before making any investment decisions.

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