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The First Crash
Book

The First Crash

Lessons from the South Sea Bubble

Richard Dale
Princeton UP, 2004

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Editorial Rating

8

Qualities

  • Overview
  • Background
  • For Beginners

Recommendation

This is a fascinating book about a fascinating time, the early eighteenth century. You will find greed, corruption, romance, duels, kings, regents and stock-jobbing scoundrels, often described by such astute contemporary chroniclers as Daniel Defoe. But this book rests on a foundation, sometimes a little too evident, of solid and painstaking financial analysis. It is perhaps the first book, certainly the first recent book, to present in great detail the analysis of Archibald Hutcheson. Hutcheson seems to have been a lone voice for sobriety and reason in the mad epoch of the South Sea Bubble. Author Richard Dale carefully draws a remarkable number of clear parallels between the first bubble in history and the most recent - the tech splat of the 1990s. getAbstract.com believes that anyone who is involved in the financial markets should read this book. It is particularly timely in bull markets.

Take-Aways

  • The early 1700s South Sea Bubble had much in common with the 1990s tech bubble.
  • Imperial CEOs, lax or corrupt regulators, complicit boards, misleading accounting and public folly are nothing new.
  • Almost all the basic, essential tools of financial analysis were present in the 1700s.

About the Author

Richard Dale is Emeritus Professor of International Banking at Southampton University, U.K. His books include Risk & Regulation in Global Securities Markets, International Banking Deregulation and The Regulation of International Banking. A financial regulatory policy expert, he has advised Parliament and testified before U.S. Congressional committees.

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