to just the right amount, no doubt.While Shiller expects a further drop in the market, he warns against making any extreme moves. He says that investors should not to pull out of stocks completely, but also that they should "not be heavily exposed to the market, because it's worrisome at this point. Worrisome but not horrible." For this reason, Shiller says he has reduced his own exposure to equities.
'not quite...yet'He also notes that recent gains in the housing market may not be sustainable. “I'm starting to worry a little bit, it's getting high by historical standards,” he says, adding that housing is a cause for concern, but it's not quite like the stock market yet in terms of valuations.
Of course, he has two houses himself.“Usually housing has not been a great investment, owner-occupied housing,” he says. “Unless it gives you pleasure... I think people tend to overestimate the investment value of housing, especially at a time like this, when home prices are already high.”
Also, he has a book you should buy. So you don't get manipulated or deceived.
(Actually, he once wrote a very good book; Finance and the Good Society, that would serve most people well if they read it.)