As covered by CCN, Nobel prize-winning economist Joseph Stiglitz recently stated that bitcoin should be outlawed during a Bloomberg television interview. Just one day after, another Nobel laureate, Robert J. Shiller, shared his view on bitcoin: that it will crash in an event similar to the U.S. stock market crash that preceded the great depression.
While Joseph Stiglitz believes the cryptocurrency should be outlawed because it “doesn’t serve any socially useful function” and that its popularity comes from the “potential for circumvention, lack of oversight,” Robert J. Shiller compared attraction to bitcoin to the narrative of a “mystery movie” that draws in people who wish to outsmart the system.
Notably, Yale economist Robert J. Shiller received the Nobel Prize in Economics for his work in “Trendspotting in asset markets,” in 2013. The economist’s popularity is partly derived from his prediction of both the dot-com and the housing bubble, as he published books titled “Irrational Exuberance” detailing these crashes.
At a conference in Vilnius, Lithuania this week, he stated:
"Bitcoin, it’s just absolutely exciting ( …) You’re fast. You’re smart. You’ve figured out nobody else understands. You’re with it. And bitcoin has this anti-government, anti-regulation feel. It’s such a wonderful story. If it were only true."
Shiller went on to add that he doesn’t know where the cryptocurrency is going to stop, but compared it to the stock market in the 1920s. Per his words, it’s going to go way up, but we “will reach a 1929 eventually.” He added that the cryptocurrency will crash but “won’t go to zero, it just will come down.”
His comments, just like those of Joseph Stiglitz, come at a time in which bitcoin hit a new all-time high above $11,400, and then quickly declined to $9,200 before starting to recover. At press time, one bitcoin is trading at $9,959, according to data from CoinMarketCap.
Interestingly, Stiglitz’s opinion on bitcoin, or at least cryptocurrencies, seems to have shifted, as when he spoke at the World Economic Forum’s Annual Meeting in Davos, Switzerland, the economist stated that the U.S. should phase out fiat currency to move toward the use of digital currencies. Shiller, on the other hand, has back in 2014 stated that the cryptocurrency is a bubble, an “amazing example of a bubble.”
Despite Shiller’s past predictions of the dot-com and housing bubbles, his claims on bitcoin don’t seem to, so far, be supported by any kind of data. Taking that into account, the only thing we can for now be sure about, is that both Nobel laureates, Shiller and Stiglitz, aren’t fans of the cryptocurrency.
Featured image from Flickr/World Economic Forum.