Readings:

• The Fed's Chairman (Greenspan) December 5, 1996 speech that warned about irrational exuberance and speculative bubbles in asset markets and led to the stock market shakeout of December 6, 1996.

• The course homepage on the Asian Economic Crisis has readings relevant for the prospects of the US stock market in 1998.

• An extensive analysis of the world economic prospects for 1998 from the Morgan Stanley economic analysis group: Looking to 1998: a special year-end issue of the Morgan Stanley Global Economic Forum

 
• The New York Times 1998 Outlook

• An article on Slate by Brad De Long, a UC Berkeley economist discussing Is the Stock Market Too High ?

• An academic paper by Yale Economist Robert Shiller explaining why the stock market is overvalued.

• Henry Kaufman's WJS op-ed piece on why "Today's Financial Euphoria Can't Last".

• Read some charts (in PDF format from Dr. Yardeni's Homepage) on the S&P Stock market indeces and the S&P P/E ratios.

• Two Wall Street comments (by Stephen Roach, chief economist at Morgan Stanley) on Greenspan's speech and the stock market reaction to it.

• A different Wall Street view (file in PDF format) on the stock market and Greenspan's speech by Dr. Yardeni, chief economist at Deutsche, Morgan Grenfell.