Valuation-Informed Indexing #711: Irrational Exuberance — Would Buy-and-Hold Exist Without It?

I’ve posted Entry 711 to my weekly Valuation-Informed Indexing column at the Value Walk site. It’s called Irrational Exuberance — Would Buy-and-Hold Exist Without It?

Juicy Excerpt: Investors don’t want to hear what the research says. They say that they do. They think that they do. It sounds good to say that you are following an investment strategy that is rooted in the findings of the peer-reviewed research. But the last 43 years of research in this field threaten to spoil all the fun. Irrational exuberance is the thing that gives stock investing the appearance of a thrill ride. Take away irrational exuberance, and there will be no more bull markets, which means that there will be no more bear markets. This means that there would likely be no more economic crises. A stock market in which Shiller’s research findings were widely discussed would be a very different stock market than the one we have become accustomed to.