Robert Shiller, Yale University professor of economics and co-founder of the Case-Shiller index, was on CNBC’s Squawk Box Europe this morning. Shiller discussed housing prices in Spain, which have been instrumental in its economic downfall. Shiller also commented on home prices in the U. S. and the psychological and economic factors effecting prices.
Shiller said Spain has had a huge bubble, but he didn’t know if we can measure prices there accurately. Shiller added it would be too difficult to make a 5-year forecast as posed by the interviewer.
Jean-Marie Eveillard has vast experience in the financial markets from managing the First Eagle Global Fund for nearly 30 years. The performance of the fund was noteworthy and he earned a Morningstar lifetime achievement award. Eveillard’s focus has been on deep value investing, seeking a margin of safety, and displaying an aversion for high-risk bets.
Jeremy Siegel, Wharton finance professor, was on Yahoo’s Daily Ticker and claimed that, relative to interest rates, stocks were a bargain today.
Siegel was asked by host Aaron Task to comment on Robert Shiller’s Cyclically Adjusted PE Ratio (CAPE), which indicates that equities are far from cheap.
Consuela Mack interviewed Yale professor Robert Shiller regarding his views on the economic malaise, the housing market, and the stock market. Shiller believes U. S. citizen’s pride and spirit was hurt when S&P downgraded the credit rating.
Shiller believes the state of the housing market has a greater impact on confidence than the performance of the stock market. He doesn’t believe home prices will make progress in real terms in the next five years. He added that the 40% decline in home prices has brought them close to the long-term trendline, but they could overshoot to the downside.
Robert Shiller’s Cyclically Adjusted PE Ratio (CAPE) has been used as justification by many bears to argue the market is not cheap. Shiller believes valuations are so stretched that stocks only offer modest returns; specifically 1.3% per year for the S&P 500 over the next 10 years (see January video). Shiller discusses stock market valuations with Jeremy Siegel and Larry Kudlow.
CNBC featured Robert Shiller and Jeremy Siegel’s opinions on the market. Shiller was cautious while Siegel feels optimistic about the coming year. Shiller says the current volatile earnings environment may mislead investors. Siegel feels current earnings are of a better quality than in the past, and coupled with the low interest rate environment, valuations on stocks can go higher.
Econbrowser has a very enlightening post entitled, “Long-term perspective on the stock market.” They look at 140 years of history from data compiled by Robert Shiller. One observation: Despite the recent correction in stock prices, stocks still cost more today relative to the earnings you’re buying than they did over most of the previous century [...]
Then along comes Henry Blodgett who posts an article at Business Insider claiming stocks are about 50% overvalued, by the calculations of economist Andrew Smithers: Smithers constructs his estimate in two ways: 1) the same cyclically adjusted PE ratio that we use, and 2) something called “Tobin’s Q,” which is a measure of replacement value. [...]
Robert J. Shiller, professor of economics and finance at Yale, feels there are still risks to the economy which rest on the whims of confidence. In fact, there is still a real risk of a double-dip recession, though it can’t be quantified by the statistical models that economists use for forecasts. Instead, the danger stems [...]
Robert Shiller, Yale University professor of economics and co-founder of the Case-Shiller index, was on CNBC’s Squawk Box Europe this morning. Shiller discussed housing prices in Spain, which have been instrumental in its economic downfall. Shiller also commented on home prices in the U. S. and the psychological and economic factors effecting prices.
Robert Shiller, "The risk of a double-dip recession hasn’t abated"
May 16, 2010Robert J. Shiller, professor of economics and finance at Yale, feels there are still risks to the economy which rest on the whims of confidence. In fact, there is still a real risk of a double-dip recession, though it can’t be quantified by the statistical models that economists use for forecasts. Instead, the danger stems [...]