george ackerloff and robert j. shiller. if you don't want to read this now, nothing i can say that would make you want to read it after listening to this conversation. it is a fascinating inquiry that goes far beyond economics in terms of the way human nature works. my thanks to bob shiller, thank you very much. >> my pleasure. microsoft and yahoo! announced yesterday a partnership in the search and advertising business. under the deal yahoo!'s websites will be powered by microsoft new search engine, binge. yahoo! will get 88% of the ad revenue from searches on its sites for the first five years. with the partnership the two hope to take on google which currently commands about 65% share of the u.s. market. agreement follows microsoft's failed take over bid for yahoo! shows the continuing importance it is placing on search. joining me from redmond, washington, is nick win field of the "w"wl street journal." here in new york, with me, steven levy of "wired" magazine and erick schonfeld coed for of techcrunch blog. i am pleas

joining us now is robert shiller, a professor of economics at yale. the influential case-shiller home e price index. he's also the chief economist at macro markets and it's great to talk to you today. thanks for joining us. >> hi, becky. >> before we get to this idea of a second housing bubble. i'd like to get your thoughts on the economy right now. i've seen some things where you don't use the term green shoots, but you say there are a few rays of sunshine starting to come out. what are you seeing? >> well, i don't know about the last few days, but this year, we've seen confidence come back. as measured by the confidence indices. and i think that is fundamentally important to a driving -- you know, we had a depression scare and it seems to be over, really. that's a good sign. >> that's a very good sign. when you look at the housing market, you think that the slow down and declines in pricing we're seeing, do you think that will continue? >> probably. we have had massive drops in home prices, as you know, can't go on forever. in our latest s&p case-sh

the secto ver well, robert shiller, heelped develop -- that later proved to true. earlier this year heublished s latest book titled "animal spirit human ychology drives the onomy and why it matters for globalapitalism. i am pased to have him back on th program. lcome. >> it is looking less dire. our dahe zip shillerdata -- that means, but the housing march quote shows a lot of momentum. we're seeing the dnwar momentum diminished. nd so that is a good sign from a standpoint of home pricesi don't know that it means it's going be a sudden turn around the last cle, that peaked around 1990, home prices by91 e rapid decli was over. t they didn't increase until '9 so, i thk that pple who are hopi for aapid turn around they could be right, nobody knows thesespeculative markets. i wouldn'told my breath. given the situationhat the hole economy is , i am still ncerned about the housing market. >> charlie: just put at aside just for a sond wher ishe economic recovery? >> well, w are now 18 months fromhe peak in december 20. since then, we' lost 6.5 million jobsaking this the s

let go robert shiller, one of the most foremost trackers of housing prices. thanks for being with us. your case shuler index shows home prices went up from april to may. that's a first month to month rise in three years. i'll take it. what do you say? >> you have to understand the housing is different from the stock market. it shows much more momentum. when you see like a car today reasoning down a hill, then it stops and turn around, it is like that with the housing market. it is suggesting the market is getting better. >> so chances are when there is a teensy improvement, it might be better than you think. first a chart of today's number which shows an increase in almost three years. do we have that? without seasonal adjustment, the number went up half a percent. people are saying -- there it is. we've got it now. but then when you seasonally see it, it was down .2 of a percent. then again we've had declines 2% month to month. only a tenth of the decline. a positive sign? others are up, too. then existing sales and new sales. a lot of different pieces of ev

robert stovall, managing director and strategist at wood asset management. on the economic calendar: monday, june new home sales; tuesday, the case-shiller home price index for may, and the conference board's july consumer confidence index; wednesday, we'll see june orders for durable goods and the fed's beige book; thursday, weekly jobless claims; and friday, it's the first look at second-quarter gross domestic product, and the second quarter's employment cost index. >> paul: my guest market monitor this week is frank cochrane, president of investment timing consultants, a financial advisory firm based in bloomfield hills, michigan. frank, welcome back to "nightly business report." >> great to be here, paul, thank you. >> paul: is the stock market's sharp run-off justified by recent signs of economic recovery, the green shutes as they call them? >> short-term, paul, i would say "no" i'm somewhat negative for the outlook for the next few weeks or so the market is discounting much stronger earnings. the earnings that came out were so low, i think a snail could have jumped over them, the bar in that sense. the credit will come back. the consumers will start sp

shiller numbers. unemployment will probably hit 11% in the u.s. people who are unemployed aren't consuming. and, therefore, we believe that -- and agree with doug robertsce the numbers actually settle in and the easy earnings comparisons are behind us, we'll see that there will be a second leg down probably about 11% in the dow and s&p before things start going up again in somewhat of an l-shaped or -- an l-shaped economic recovery. >> and i wonder, doug, source o mortgage trouble, which had been because of lending standards in those subprime mortgages is now being exacerbated by rising unemployment. >>> energy demand is weak and industry costs remain high for shell. the current supply cost earnings for 2.3 billion versus 7.9 a year ago. shell says it made cost savings of $700 million in the first half of the year and has reduced have management positions and expects to make further substantial staff reductions. shell is, though, increasing its dividend payout by 5% a year ago, the stock just off by 1% a moment ago. christine. >>> japan's nintendo saw a 66% slump in its quarterly profit way down by slowing demand for its wii, strong demand. for the apr