Valuation-Informed Indexing #558: The Term “Irrational Exubernace” Is a Synonym for “Scam”

I’ve posted Entry #558 to my weekly Valuation-Informed Indexing column at the Value Walk site. It’s called The Term “Irrational Exuberance” Is a Synonym for “Scam”

Juicy Excerpt: Irrational exuberance is a scam. Is that not so?

Even people who are generally sympathetic to Shiller’s ideas usually do not refer to it as such. People think of irrational exuberance as one more thing to take into consideration when settling on a stock allocation. It’s really much more than that. Shiller’s showing that there are times (like today!) when more than half of the wealth held in the stock market is artificial is a cry of “foul!” as to the entire working of the market. For so much false wealth to be created, pretty much all of us had to be in on the scam. We are not talking about some small act of corruption. This is pervasive.