Robert Toll, America's Largest Luxury Homebuilder, Not Laughing Anymore

New York was a very different place two years ago, and Robert Toll, chief executive of massive luxury homebuilder Toll Brothers, was a cockier man. "Shiller is predicting the mountain goes into the sea," he said about Yale economics professor Robert Shiller, who had been warning that the real estate boom was a dangerous bubble. "He's selling himself."

What's happened since then? Yesterday, Toll Brothers Inc. reported its seventh consecutive quarterly drop in revenue, which fell 22 percent to $842.7 million in the fiscal first quarter from the same time 2007. "We are not yet seeing much light at the end of the tunnel,'' Mr. Toll said.

When I gave him a slight chance to gloat about Toll's misinformed old diss in a recent interview, Professor Shiller had this to say: "Their stock, I’m trying to remember, soared just like the NASDAQ stocks in the 90’s." (Remember, Mr. Shiller became famous for accurately predicting the end of the Internet boom too.) "I guess they didn’t appreciate anyone criticizing their optimism, investors were really believing in them, and they were doing extremely well because of the boom. Of course, they’re not going to want to hear it’s temporary."