Nobel winner Robert Shiller says there's still a risk of a full-blown bear market

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U.S. stock markets may have recovered slightly from sharp falls at the end of last year, but there’s still a risk of a significant downward trend, Robert Shiller, a professor of economics at Yale University and a Nobel laureate, told CNBC Wednesday.

“I’m not confident of my ability to predict, but I think there’s a risk (of a bear market in 2019), yes,” he said. “I categorize risks in terms of ‘narratives’ and this bear market narrative has taken a strong hold.”

“There is a feeling that the stock market might be due for some deflating now because it’s been a long time, and we’ve seen some hints of it and we haven’t seen the real deflation yet,” he told CNBC at the World Economic Forum (WEF) in Davos, Switzerland.

Shiller, who won the Nobel Prize for Economics in 2013 for his work on asset prices and inefficient markets,

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