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On bubbles, reflexivity, and narrative economics

Economist Robert J Shiller also talks about why people involved with forecasting have to use every available perspective to stay in touch with reality

The Great Depression narrative... has become a legend. It's become something that is exaggerated in its importance," says Prof Shiller.

"We don't want crazy fluctuations in the market. If we can prevent markets from ever falling too far or ever going up too much, that's a good thing," says Prof Shiller.

NOBEL laureate and Yale economics don Robert J Shiller has shown remarkable prescience over the years. In his New York Times best-seller Irrational Exuberance, he successfully called the dot-com bubble. Less than 10 years later, in the run-up to the financial crisis, he issued similarly accurate...

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