ROBERT SHILLER: 'I Am Most Worried About The Boom In The US Stock Market'
Robert Shiller, who won the esteemed award with two other Americans for research into market prices and asset bubbles, pinpointed the U.S. stock market and Brazilian property market as areas of concern.
"I am not yet sounding the alarm. But in many countries stock exchanges are at a high level and prices have risen sharply in some property markets," Shiller told Sunday's Der Spiegel magazine. "That could end badly," he said.
"I am most worried about the boom in the U.S. stock market. Also because our economy is still weak and vulnerable," he said, describing the financial and technology sectors as overvalued.
He had also looked at "drastically" higher house prices in Rio de Janeiro and Sao Paulo in Brazil in the last five years.
"There, I felt a bit like in the United States of 2004," he said, adding he was hearing arguments about investment opportunities and a growing middle class that he had heard in the United States around the year 2000.
The collapse of the U.S. housing market helped trigger the 2008-2009 global financial crisis.
"Bubbles look like this. And the world is still very vulnerable to a bubble," he said.
Bubbles are created when investors do not recognize when rising asset prices get detached from underlying fundamentals.
(Reporting by Madeline Chambers; Editing by Mark Potter)
- I spent $2,000 for 7 nights in a 179-square-foot room on one of the world's largest cruise ships. Take a look inside my cabin.
- Saudi Arabia wants China to help fund its struggling $500 billion Neom megaproject. Investors may not be too excited.
- Colon cancer rates are rising in young people. If you have two symptoms you should get a colonoscopy, a GI oncologist says.
- ITC plans to open more hotels overseas: CMD Sanjiv Puri
- 2024 LS polls pegged as costliest ever, expenditure may touch ₹1.35 lakh crore: Expert
- 10 Best things to do in India for tourists
- 19,000 school job losers likely to be eligible recruits: Bengal SSC
- Groww receives SEBI approval to launch Nifty non-cyclical consumer index fund