Published at the height of the dot-com boom, the text put forth several arguments demonstrating how the stock markets were overvalued at the time, and likely to offer poor return on investment based on analysis of the cyclically adjusted price-to-earnings ratio which Shiller co-developed in the late 1980s.

By happenstance, the dot-com bubble peaked the month of the book's publication as measured by the Nasdaq stock index,[2] before a gradual collapse by over 80% in the next two years.

He also showed that home prices, when adjusted for inflation, have produced very modest returns of less than 1% per year when measured over long-term periods.

[4] Nassim Nicholas Taleb, a retired Wall Street options trader, spoke highly of Shiller's book in his own Fooled By Randomness (2001).

Kirkus Reviews praised the third edition of book, saying it was a rarity among economic publications in being loyal to the complexities of the subject while "wholly accessible to general readers.