Robert Shiller, the economist and Nobel laureate, is worried about the boom in the U.S. stock market. Alan Greenspan, the former Federal Reserve chairman, is relaxed, suggesting that the trends are not characteristic of bubble territory.
It’s not a duel; Mr. Shiller was quoted in Der Spiegel, the German news magazine, over the weekend expressing his concern about stock values. “Bubbles look like this,” he said. Separately, Mr. Greenspan was expounding in a Bloomberg TV interview. The coincidence is noteworthy, however. The former central banker was widely criticized for doubting bubble formation in the late 1990s. Meanwhile, Mr. Shiller is perhaps the world’s leading financial bubble analyst, the author and co-founder of the Case Shiller real estate price index. Indeed, the title of Mr. Shiller’s book on financial bubbles, Irrational Exuberance, was a jibe at Mr. Greenspan’s famous comment in 1996: “how do we know when irrational exuberance has unduly escalated asset values?”