Irrational Exuberance

Shiller argues that asset booms can grow through reinforcing stories and social behavior, rather than changes in fundamental value alone.

Rising prices can attract buyers whose purchases help push prices higher.

Claims that familiar limits no longer apply can make high prices feel permanently justified.

Public attention can spread a market story faster than careful analysis spreads.

Seeing other people buy can appear to confirm a belief without adding independent evidence.

Economic conditions and investor behavior interact, so explaining a bubble does not reliably reveal when it will end.