Robert Shiller co-creator of the Case-Shiller housing index, discusses the possibility of another bubble in housing. The market is pricing in a total of four percent rise in home prices in the next five years. Housing affordability is at a 40 year high.
Comparing now to the Great Depression, Shiller points out that when Roosevelt took office in March 1933 the stock market doubled in a matter of months and the bull market ran until 1937. But the unemployment rate never dropped below 10%.
Shiller has a new book where he discusses the importance of sentiment. It is Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism
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