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For anyone that hasn't read it, I highly recommend 'Irrational Exuberance' by Robert Schiller, a professor at Yale which covers the theme 'This time its differe
by zhte415 12y ago
For anyone that hasn't read it, I highly recommend 'Irrational Exuberance' by Robert Schiller, a professor at Yale which covers the theme 'This time its different' in depth, in a long term context covering around 200 years of economic data, in particular regarding herding of investors and thought (as sheep herd, then scatter, then herd). One of the interesting observations of the book is that there has been a recession every 10 years for as far back as the data covers (100+ years) +-2 years of the end of each decade.
A link to the site, with data sets the book covers freely downloadable: http://irrationalexuberance.com/ http://irrationalexuberance.com/
- vishnugupta 12y agoAnd as an addendum, I highly recommend "Thinking, Fast and Slow" by Daniel Kahneman. A huge take away for me from that book was that humans are very bad at predicting far into the future, especially when it comes to phenomenon that involve multiple feedback loops. Finance is a prime example of such a phenomenon where changes in policy, regulation, productivity and a host of other factors that influence financial markets, have their impact only several years down the road. Human mind is such that it impulsively reacts only to recent memory and uses it to extrapolate it to future. It is a fascinating read, one that got me hooked into the subject matter of human psychology and behavioral economics.