From Booklist
For the subject of financial disasters, Charles Kindleberger's Manias, Panics, and Crashes and Robert Sobel's Panic on Wall Street are classics. Chancellor's book will well complement those two standards. Although speculation does not necessarily lead to disaster, the two often go hand in hand. Chancellor studied history at Cambridge and Oxford and contributes to the Financial Times and the Economist. He readily admits that his is not a comprehensive history; instead, he concentrates on notable "occurrences of speculation" and emphasizes their social context. He traces the antecedents of speculation to ancient Rome, but his account begins with a depiction of the tulipomania that swept the Dutch Republic in 1630. Other episodes include the South Sea Bubble, railway mania, the Gilded Age, the crash of 1929, and Japan's 1980s "bubble economy." Noticeably absent is the current craze for Internet-related stocks, but readers will be able to draw parallels from Chancellor's examples. Even though it is loaded down with erudite references, Chancellor's book remains fascinatingly readable. David Rouse
From Kirkus Reviews
Cautionary armchair reading for the modern investor. The old mantra about history repeating itself has clearly inspired British financial journalist Chancellor (a contributor to the Financial Times and the Economist) to write this book at this point in time. Although many volumes have already appeared on both financial speculation in general and individual historic events in particular, even well-informed readers will find new material and interpretation here. From tulip bulbs in 17th-century Holland to the American stock crash of 1929and pointedly including the current boom in Internet stocksspeculation is presented by Chancellor as a common and very human behavior involving all classes of people. The author weaves together a descriptive narrative of major episodes with retrospective analysis by various authoritiesindeed, the change in expert opinion is often as intriguing as the manipulations of the speculators themselves, since over time conventional wisdom on almost all of these events has evolved. The most prominent and notorious speculators (Cornelius Vanderbilt, James Fisk, and Charles Keating, among others) earn biographical profiles in the text. Chancellor opens his financial adventure story with a rational and articulate description of speculation, then along the way introduces ever-more- convoluted investment strategies and practices, accompanied by articulate descriptions of terms. His book therefore provides a running primer on basic investment concepts alongside the tales of greed, political shenanigans, shrewd maneuverings, and obsession. The author largely succeeds in being fair to the variety of interpretations given to speculation, including opposing calls for looser and stricter controls. He has some misgivings, however, about the current prevailing belief that the market is ``inherently efficient'' and best suited to manage itself, at least in the long run. Chancellor closes with an admonition: ``As an anarchic force, speculation invites government restrictions yet it is only a matter of time before it slips its chains and runs amok.'' Timely, beautifully written, ruthlessly informative. -- Copyright ©1999, Kirkus Associates, LP. All rights reserved.
Review
"A triumph of scholarship and understanding. Invest in this book!" -- James Grant, Author of Trouble With Prosperity
"Edward Chancellor has combined his considerable talents as historian and banker to produce a riveting book. Here is a bonus for the banker, broker, investor, and idle Wall Street onlooker." -- Charles P. Kindleberger, Author of Manias, Panics, and Crashes
"Edward Chancellor has combined his considerable talents as historian and banker to produce a riveting account of financial bubbles, followed by busts, in Britain, the United States, and Japan . . . Here is a lagniappe for the banker, broker, investor, and idle Wall Street onlooker." -- Charles P. Kindleberger, author of Manias, Panics, and Crashes
"The best, most insightful study of speculation and bubbles I have read. It should be required reading for every investor." -- Barton M. Biggs, Chairman, Morgan Stanley Asset Management
From the Inside Flap
Many modern economists hold that speculation is a benign economic activity, that it is always rational in motivation and rarely adverse in its effects. The struggles of the United States after the Crash of 1929 and of Japan in the 1990s suggest otherwise. Some commentators, the billionaire financier George Soros among them, believe that growing speculative forces threaten a global financial crisis. Devil Take the Hindmost is an original and challenging history of stock-market speculation from the seventeenth century to the present day. Through vivid accounts of the speculative activities (wise and unwise) of investors ranging from Daniel Defoe and Benjamin Disraeli to Ivan Boesky and Hillary Rodham Clinton, Edward Chancellor shows that speculation is not driven solely by the desire to make money--by fear and greed--but springs from a wider range of human compulsions and aspirations.
Chancellor traces the origins of the speculative spirit back to ancient Rome and chronicles its revival in the modern world: from the Tulip Mania in Holland in the 1630s and the stock-jobbers in London's Exchange Alley at the end of the seventeenth century to the on-line "day-traders" of the information age.
Devil Take the Hindmost charts the development of speculation in the United States from the middle of the nineteenth century in chapters on Jay Gould and the Gilded Age, the Roaring Twenties, and the junkbond mania of the 1980s. According to Chancellor, the American passion for speculation derives from the notion's fierce competitiveness and appetite for risk. This is a source both of the nation's strength--as shown by the vibrant U.S. economy in the 1990s--and of its potential weakness, as the lessons of the Great Depression of the 1930s suggest.
A chapter on the 'bubble economy" of the 1980s shows how the anarchic force of speculation undermined the Japanese economic system; and in an epilogue, Chancellor examines contemporary arguments for and against speculation in light of the recent crisis at the Long-Term Capital Management hedge fund.
About the Author
Edward Chancellor studied history at Cambridge and Oxford. In the early 1990s he worked for the investment bank Lazard Brothers. He is a freelance contributor to the Financial Times and The Economist
