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Everyone is scared: Nobel Prize winner Shiller

Source: World Economic Forum

The human race has deep underlying fears about technology and the lives their children will lead and this can be seen - in all places -- in the negative yields in bond markets, Nobel Prize-winning economist Robert Shiller told CNBC."I think fears have been growing for years that represent the willingness of people to bid up bond prices," he told CNBC Wednesday."They are worried about their future. They are worried not just about next year, they are worried about the next twenty years, the next forty years. So they are desperately trying to provide for that, they'll even accept negative yields." Shiller won the Nobel prize for economics in October 2013 for his research that has improved the forecasting of long-term asset prices and helped the emergence of index funds in stock markets. He was awarded the 8 million crown ($1.25 million) prize alongside fellow economists Eugene Fama and Lars Peter Hansen. In London after a trip to the World Economic Forum , he said that the Davos event had helped him understand that there is not just pessimism about the global economy, but worry. "There's this increasing fear of technology, information technology, artificial intelligence, robotics, 3-D printers, the internet and all these different forms," he said. Technology, he added "seems to be changing life in such a fundamental way and what it's leaving people thinking is 'where will I be in 30 years? Look how fast everything is changing now. Where will my children be? I want to leave something for them because they could be in terrible straits'." The World Economic Forum's (WEF) Global Risk Report, released to coincide with last week's event, warned of people designing "bespoke viruses as murder weapons" and that computers could turn rogue.

In Davos, Yahoo chief executive Marissa Mayer told delegates that she expected internet privacy to swing further into the hands of governments over the coming months. At another seminar, the Daily Mail reported, a panel of academics warned of mosquito-sized robots flying around and stealing DNA samples. Responding to Shiller, Edmund Shing, the global equity portfolio manager at BCS Asset Management, told CNBC that he often wonders whether the world is not in the throes of a second industrial revolution but rather a technological revolution. He was concerned that a whole class of jobs could either disappear or become deflationary.

"You (might not) see any more wage increases because of the pressure from technology," he said. Shiller added that Davos had taught him that people are trying to make sure they are in the top 1 percent of global earners. "This is desperation for many people," he said. "The problem now is we are going through a technological revolution, unlike any in history because we seem to be getting right to core abilities that people have, that's the ability to think, to know." He added that knowledge from humans was becoming even more absolute because of technology. The example he gave was that astronomy is becoming more redundant with the advent of mobile applications. "They just whip out their phone and they can beat you," he said.