While economist Robert Shiller finds American stocks to be expensive, he suggests that battered Greek equities may actually present a compelling opportunity for savvy investors.
The Nobel prize-winning Yale economist is famous for his valuation-based view of markets. In the long-run, low price-to-earnings ratios provide attractive long-term opportunities, and richly valued markets require caution, his work has shown.
Human psychology is what tends to get in the way and to create such opportunities, causing investors to become overly pessimistic at times when stocks are attractive, and far too optimistic in the midst of the bubbles, he has said.
It is perhaps only in the context of his well-known financial and psychological framework that Shiller's latest investment idea can be properly understood.
In an interview Thursday on the CNBC.com program "Trading Nation," Shiller said that stocks in the U.S. are likely to provide only low returns in the medium-term, but "There's also the rest of the world. The U.S. is an expensive market; practically anywhere else is cheaper."
When pressed on where the best value might be found now, Shiller quickly responded: "Greece!"