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Devil Take the Hindmost

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Devil Take the Hindmost

A History of Financial Speculation

FSG,

15 min read
10 take-aways
Audio & text

What's inside?

The history of financial speculation: From the Roman Coliseum to the Internet bubble.

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Editorial Rating

7

Qualities

  • Analytical
  • Overview
  • Background

Recommendation

This is a thoroughly engaging book about the world of financial speculation. Edward Chancellor discusses the origins of financial markets from the time of the Roman Empire through the modern Internet bubble. The book offers great insights about stock exchanges, outbreaks of speculation mania, and the fraud and greed that accompany any human endeavor. He presents in-depth reviews of many well-known "speculative manias" and several of the lesser-known ones. getAbstract recommends this book to anyone who wants a thoughtful treatment of a subject that touches all our lives.

Summary

Speculation and Human Nature

What is speculation? Some modern, intense examples include Internet companies, day trading, and the 1990s rise of the U.S. economy. Adam Smith believed the speculator "...is defined by his readiness to pursue short-term opportunities." John Maynard Keynes called speculation "...the activity of forecasting the psychology of the market." Fred Schwed said, "speculation is an effort...to turn a little money into a lot. Investment is an effort...to prevent a lot of money becoming little."

Many people view speculation as a form of gambling, believing that, the "psychologies of speculation and gambling are almost indistinguishable: both are dangerously addictive habits that appeal to fortune." During investment bubbles, speculators follow a herd mentality that rejects traditional risk analysis. In fact, it can be argued that investors today are pursing the Internet the same way investors in the past pursued land, gold, cars, and railroads.

Rome, The Tulip Mania and The Modern Age of Speculation

The earliest speculation goes back to ancient Rome. Roman law allowed free transfer of property, money lending, currency transfers, and payments...

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.

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