Devil Take the Hindmost: A History of Financial Speculation

Amazon.com Price: $9.99 (as of 11/10/2019 02:56 PST- Details)

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Description

Is your investment in that new Internet stock a sign of stock market savvy or an act of peculiarly American speculative folly? How has the psychology of making an investment changed–and not changed–over the past five hundred years? Edward Chancellor examines the nature of speculation–from medieval Europe to the Tulip mania of the 1630s to today’s Internet stock craze. A contributing creator to The Financial Times and The Economist, looks at both the psychological and economic forces that drive people to “bet” their money in markets; how markets are made, unmade, and manipulated; and who wins when speculation runs rampant. Drawing colorfully on the words of such speculators as Sir Isaac Newton, Daniel Defoe, Ivan Boesky, and Hillary Rodham Clinton, Devil Take the Hindmost is part history, part social science, and purely illuminating: an erudite and hugely entertaining book that may be more timely today than ever before.
“The longest bull market in history” is a term that gets used a lot at the present time. Since 1990, the Dow Jones Industrial Average has risen some 8,000 points, from around 2,700 in January 1990 to nearly 11,000 today–a boom by anyone’s standards, including Edward Chancellor’s. In Devil Take the Hindmost, Chancellor takes an entertaining, albeit sobering, look at the history of speculative manias and the mass delusion that surrounds them.

Beginning with the “tulipomania” that gripped Holland in the 1630s, Chancellor chronicles the formations and irrational euphoria that can inflate markets, from shares of South Sea stock in England in the 1720s to real estate in Japan in the late 1980s. He characterizes the speculative spirit as one that

loves freedom, detests cant, and abhors restrictions. From the tulip Colleges of the seventeenth century to the Internet investment clubs of the late twentieth century, speculation has established itself as the most demotic of economic activities. Even though profoundly secular, speculation is not simply about greed. The essence of speculation remains a Utopian yearning for freedom and equality which counterbalances the drab rationalistic materialism of the modern economic system with its inevitable inequalities of wealth.

But it’s precisely such inevitability that all the time seems to win out, when “sharply rising prices followed by sudden panic without cause” bring speculative excess to an abrupt end.

Chancellor makes Devil Take the Hindmost especially relevant to today’s U.S. investors by the usage of his analysis of past speculative manias as a lens through which to view the current bull-market binge. It doesn’t matter what his or her current investment outlook is–bull or bear–anyone with capital to invest would do well to spend a thoughtful weekend with this book. Highly beneficial. –Harry C. Edwards

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