I’ve posted Entry #260 to my weekly Valuation-Informed Indexing column at the Value Walk site. It’s called Shiller’s Ideas Should Be Treated as Mainstream Ideas.
Juicy Excerpt: Shiller is out there. His view of how the stock market works is about as far removed from the view held by the Buy-and-Holders as it is possible to imagine.
So they dismiss him. They patronize him. They ignore him.
Take a look at the investing advice that Jack Bogle was advancing in 1980, the year prior to the publication of Shiller’s revolutionary research. It is identical in every way to the investing advice that Bogle offers today. Shiller’s research findings had zero effect on Bogle’s views. So far as Bogle and all the other Buy-and-Holders are concerned, Shiller might as well not exist. His findings are insignificant.
But how do they explain the best-selling book? How do they explain the Nobel Prize in Economics? How do they explain the fact that millions of investors find merit in Shiller’s ideas?