In the United States, two illusions have been important recently in financial markets. One is the carefully nurtured perception that President-elect Donald Trump is a business genius who can apply his deal-making skills to make America great again. The other is a naturally occurring illusion: the proximity of Dow 20,000. The Dow Jones Industrial Average has been above 19,000 since November, and countless news stories have focused on its flirtation with the 20,000 barrier – which might be crossed by the time this commentary is published. Whatever happens, Dow 20,000 will still have a psychological impact on markets.
- Robert Shiller
Bob Shiller is America’s preeminent authority on market psychology and a Nobel prize winner on the topic to boot. Hit the jump above to hear his just-posted thoughts on both the “Trump Trade” and Dow 20,000.