When alan greenspan, then chair of the federal reserve board, used the term irrational exuberance to describe the behavior of stock market investors, the world fixated on those words. Irrational exuberance is the phrase used by the thenfederal reserve board chairman, alan greenspan, in a speech given at the american enterprise institute during the dotcom bubble of the 1990s. He relates how people think they know more than they do and this in turn affects their investing behaviour. Its also a book by robert shiller describing the 2000 stock market bubble. The phrase was interpreted as a warning that the stock market might be overvalued. The term was popularized by former fed chairman alan greenspan in a. The original and bestselling 2000 edition of irrational exuberance evoked alan greenspan s infamous 1996 use of that phrase to explain the alternately soaring and declining stock market. Irrational exuberance is the phrase used by the thenfederal reserve board chairman, alan greenspan. In the stock market, its when investors are so confident that the price of an asset will keep going up, they lose sight of its underlying value. With a new afterword on the current state of the stock market, the ongoing debate over the new economy, and the larger implications of irrational exuberance. The term irrational exuberance derives from some words that alan greenspan, chairman of the. Describing stock gains as irrational exuberance, alan greenspan tried to deflate extraordinary market levels in a speech delivered 20 years ago monday.
It focuses on how the mood of irrational exuberance is pushing up the stock prices and stretching the valuations and how the levels of the us stock markets are way above rational. I chose this phrase as the title for my book because many people know instantly from this. Alan greenspan irrational exuberance business insider. Irrational exuberance is also the name of a 2000 book authored by. In this controversial, hardhitting account of todays explosive market, robert j. The book gets its name and theme from the buzzwords used in alan greenspans speech as the chairman of the us federal reserve board in 1996. The original and bestselling 2000 edition of irrational exuberance evoked alan greenspans infamous 1996 use. Irrational exuberance is a march 2000 book written by american economist robert j. Filled with charts and graphs and footnotes of every description, the bookwhose title comes from a quote by alan greenspan attacks wall street ideas that have become so accepted that they are household sayings. Another aspect of overconfidence, as he points out. Filled with charts and graphs and footnotes of every description, the book whose title comes from a quote by alan greenspan attacks wall street ideas that have become so accepted that they are household sayings.
In this bold and potentially urgent volume, robert j. The book gets its name and theme from the buzzwords used in alan greenspan s speech as the chairman of the us federal reserve board in 1996. Shiller, a respected expert on market volatility, offers an unconventional interpretation of recent u. Four years after the talk, yale economist and nobel laureate robert shiller made the words famous by using them to title a book that is now in its fifth edition. The book examines economic bubbles in the 1990s and early 2000s, and is named after federal reserve chairman alan greenspans famed irrational exuberance. May 26, 2020 the former federal reserve chairman alan greenspan spoke the phrase irrational exuberance once in a speech to investors in new york almost twentytwo years ago. On december 5, 1996 chairman alan greenspan used the phrase irrational exuberance when speaking of his deep concern about the high level of stock prices not as a forecast but as a long term threat to economic soundness. He believed that central should raise interest rates when.
The book examines economic bubbles in the 1990s and early 2000s, and is named after federal reserve chairman alan greenspan s famed irrational exuberance quote warning of such a possible bubble in 1996. It predicted the collapse of the tech stock bubble through an analysis of the structural, cultural, and psychological factors behind levels of price growth not reflected in any other sector of the economy. Alan greenspan raised the question of whether central banks should address irrational exuberance via a preemptive tight monetary policy. Discover similar books recommended by the worlds most successful people in 2020. Books similar to irrational exuberance by robert shiller. Shiller, a yale university professor and 20 nobel prize winner. But the phrase was made famous or infamous, depending on how you look at it by yale professor robert shiller, who published the book. Shiller, a leading expert on market volatility, evokes alan greenspan s infamous 1996 reference, irrational exuberance, to explain. Shillers irrational exuberance is about the most bearish book you could ever read about the stock market.
Interested in irrational exuberance by robert shiller. The book originally contributed to my courage to be conservative on the market and hence was one of the most valuable books i have ever read. Shiller used it as the title of his book, irrational exuberance, first published in 2000, where shiller states. He calls this magical thinking thoughts that they do not have to explain or justify to others. Shiller takes a little know phrase uttered by alan greenspan, irrational exuberance and turns it into a best seller as no one else can. The original and bestselling 2000 edition of irrational exuberance evoked alan greenspan s infamous 1996 use of that phrase to explain the. The phrase was coined by former federal reserve chairman alan greenspan in 1996.