How do we know when irrational exuberance has unduly escalated asset values, which then become subject to unexpected and prolonged contractions as they have in Japan over the past decade?

But, given our current state of knowledge, I find it difficult to envision central banks successfully targeting asset prices any time soon,

Because it is difficult to suppress growing market exuberance when the economic environment is perceived as more stable, a highly flexible system needs to be in place to rebalance an economy in which psychology and asset prices could change rapidly,

The Fed is struggling to find a firmer standard of monetary policy, ... The focus on asset prices has become an increasing issue of debate at the Fed.

These changes, assisted by improved prices in asset markets, have left households and businesses better positioned than they were earlier to boost outlays as their wariness about the economic environment abates,