Extraordinary Popular Delusions and the Madness of Crowdsby Charles Mackay
First published in 1841, Extraordinary Popular Delusions and the Madness of Crowds is often cited as the best book ever written about market psychology. This Harriman House edition includes Charles Mackay's account of the three infamous financial manias - John Law's Mississipi Scheme, the South Sea Bubble, and Tulipomania. Between the three of them, these historic… See more details below
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First published in 1841, Extraordinary Popular Delusions and the Madness of Crowds is often cited as the best book ever written about market psychology. This Harriman House edition includes Charles Mackay's account of the three infamous financial manias - John Law's Mississipi Scheme, the South Sea Bubble, and Tulipomania. Between the three of them, these historic episodes confirm that greed and fear have always been the driving forces of financial markets, and, furthermore, that being sensible and clever is no defence against the mesmeric allure of a popular craze with the wind behind it. In writing the history of the great financial manias, Charles Mackay proved himself a master chronicler of social as well as financial history. Blessed with a cast of characters that covered all the vices, gifted a passage of events which was inevitably heading for disaster, and with the benefit of hindsight, he produced a record that is at once a riveting thriller and absorbing historical document. A century and a half later, it is as vibrant and lurid as the day it was written. For modern-day investors, still reeling from the dotcom crash, the moral of the popular manias scarcely needs spelling out. When the next stock market bubble comes along, as it surely will, you are advised to recall the plight of some of the unfortunates on these pages, and avoid getting dragged under the wheels of the careering bandwagon yourself.
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This short version of Charles MacKay's book, Estraordinary Popular Delusions and the Madness of Crowds, which was first publilshed in 1841, should be on the reading list for anyone looking to make a fast buck, in the stock market or elsewhere. Change the names, places and time frame, and you would swear that it was just written. Amazing!! Popular delusions affect many investors - just ask Madoff, and other swindlers. The urge to "get rich quick" is mostly delussional. Once in ten thousand investments does one "hit the jackpot". The "Hula-hoop" back in the 50's is a classical example of hitting it big. President Obama should take the time to read this, but then again, he may not be invested in the market, or anywhere else. Americans are easily swayed by the "Rainmaker". This book, if read and compared to today's current affairs in the United States, and around the world, will reveal that human beings are gullable, as well as greedy, otherwise, they would be more cautious with whom they place their trust with their hard earned funds.