| Devil Take the Hindmost: A History of Financial Speculation |  | Author: Edward Chancellor
Publisher: Plume
Category: Book
List Price: $17.00
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Seller: bay-city-books
Rating:  69 reviews
Sales Rank: 7,795
Media: Paperback
Pages: 400
Number Of Items: 1
Shipping Weight (lbs): 0.9
Dimensions (in): 8.9 x 5.9 x 0.9
ISBN: 0452281806
Dewey Decimal Number: 332.64509
EAN: 9780452281806
ASIN: 0452281806
Publication Date: June 1, 2000
Availability: Usually ships in 1-2 business days
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Amazon.com Review
"The longest bull market in history" is a term that gets used a lot these days. 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. Although 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 always 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 using his analysis of past speculative manias as a lens through which to view the current bull-market binge. No 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 recommended. --Harry C. Edwards
Product 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 investing changed--and not changed--over the last 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 writer to The Financial Times and The Economist, Chancellor 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 is more timely today than ever before.
"Entertaining, useful, admirable scholarship . . . Chancellor seems to have read everything." --Adam Smith, The New York Times Book Review
"Anyone contemplating a stock market venture and certainly anyone now involved should read this book."--John Kenneth Gailbraith
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| Customer Reviews:
Showing reviews 1-5 of 69
 The hobo philosopher January 28, 2010
Richard E. Noble (Florida Panhandle)
1 out of 2 found this review helpful
This book makes it extremely clear that the stock market is a dangerous place. The author begins with the speculator and the ethics of speculation.
"Speculation is a divisive topic. Many politicians - several of them in Asia - warn that the global economy is being held hostage by speculators. In their opinion, the speculator is a parasitical figure, driven by greed and fear, who creates and thrives on financial crises ... Western economists take a radically different line. They argue that speculation is fundamentally a benign force, essential to the proper functioning of the capitalist system."
In the last paragraph of the book the author gives us his conclusion on this speculative debate.
"Speculation undermined the Bretton Woods system of fixed currencies and, more recently, it has destroyed the state managed capitalism of Japan and other Asian nations. As an anarchic force, speculation demands continuing government restrictions, but inevitably it will break and chains and run amok. The pendulum swings back and forth between economic liberty and constraint."
That conclusion in my estimation gets a 10 on the Alan Greenspan scale of economic mumbo-jumbo. But it is standard fare from those versed in economics. After reading the book I actually understand what the author is trying to say in this self-contradictory statement. That's a little scary, in itself.
But in truth I did not buy this book to get the author's answers to anything. I bought it to get historical information on panics, bubbles and crises. I got a good deal of information. I'm satisfied.
I was actually looking for a book discussing U.S. panics beginning with colonial times and coming forward to the present. More than half this book discusses pre-colonial panics and countries other than the U.S. So I'm still in the market for something more specific and more detailed.
But what about investing in the stock market? What kinds of people have been involved in this enterprise? And how should an average person look at the stock market for his personal investments.
The answers for me, after reading this book are: Do not invest in the stock market. It is filled with crazies, manipulators and the clinically insane - not to mention outright gangsters and criminals. And an average person would be better off investing their life's savings in their retarded son-in-law than giving their money to a stock broker.
The author takes his readers on a tour of the many famous speculative bubbles and manias of the past going back to the "Tulipomania" of 1630 and carrying us through the Japanese crisis of the 1980s. He even dabbles into present day derivatives and hedge funds. The book was published in 1999 so it predates the current fiasco. But this book makes it very clear that the historical information was there. Japan should have been an obvious example.
For Alan Greenspan to state before Congress that he couldn't imagine that prominent bankers and brokers would act in such a "negligent" unprofessional manner is beyond naivete. Alan was obviously joking. It is difficult to determine when Alan Greenspan is joking.
But Alan was not the criminal. He did nothing wrong. He did nothing right either. As J.K. Galbraith stated in many of his books, the Federal Reserve and its bosses did exactly what they should have done ... nothing. If they let the bubble go until it collapsed they are blamed for the collapse. If they put on the brakes and tighten up the money in the middle of a "boom" they will be blamed from killing the growth and crippling the prosperity. For us here at home the big questions are where were the inspectors, the regulatory agencies and the Congress and the Senate with the proper rules? And even bigger question ... Where was the moral conscience of all those thousands who participated in all the scamming and falsifying? We had more than an accident here. We had a moral and ethical calamity.
What this book makes clear is that what has happened has happened many times before - not on such a great a scale as today. This current speculative extravaganza was a major moral earthquake.
Galbraith said in his book "Money, Whence it Came, Where it Went" that the time between speculative insanities or panics is directly proportional to the time it takes for everyone to forget the last speculative bubble or panic.
Galbraith also had much the same confusing type answer to the problem as offered by Mr. Chancellor.
For the present, rules and regulations need to be put in place but as time goes on these rules or any rules will be undermined. There will then be another collapse and a new need for newer rules. Galbraith suggested a five year term for new rules and new regulators. Then all bureaus should be abolished and new ones established. In other words, the new rules must be kept ahead of the old rule breakers and manipulators. Keep changing the game.
This answer seems to indicate that the problem is endemic to the system. So we need a new system. But is that possible? And what will it be? And will it have other flaws equal to or worse than the present system?
Maybe the same system could be continued if we could just develop some better human beings.
Books written by Richard Noble - The Hobo Philosopher:
"Hobo-ing America: A Workingman's Tour of the U.S.A.."
"A Summer with Charlie" Salisbury Beach, Lawrence YMCA
"A Little Something: Poetry and Prose
"Honor Thy Father and Thy Mother" Novel - Lawrence, Ma.
"The Eastpointer" Selections from award winning column.
"Noble Notes on Famous Folks" Humor - satire - facts.
 Book Review from the Aleph Blog January 23, 2010
David Merkel (Ellicott City, MD United States)
3 out of 3 found this review helpful
Sometimes we forget how bad it can be, and then we howl over minor bad times in the markets. We may be past a mania in residential housing, but we have not really experienced a panic or crash yet. People squeal over how bad the equity market is, but recently we haven't had anything like the 2000-2002 experience, much less the 1973-1974 or 1929-1932 experience.
Two books come to mind when I think about disaster in a non-fear-mongering way: Manias, Panics, and Crashes, by Charles Kindleberger, and Devil Take the Hindmost, by Edward Chancellor. They take two different approaches to the topic, and those approaches complement each othe, giving a fuller picture. Chancellor takes a historical approach, while Kindleberger deals with the structures of financial crises.
From Chancellor, you will see that manias and their subsequent fallout are endemic to Western culture. Someone living a full life over the last 300+ years would see one or two big ones, and numerous small ones. Relatively free societies give people freedom to make mistakes. Given the way that people chase performance, we can all make mistakes as a group, with large booms and busts. Much as the regulators might want to tame it, they can pretty much only affect what kind of crisis we get, and not whether we get one. He is somewhat prescient in suggesting that the leverage inherent in derivatives post-LTCM could be the next crisis. This book is a better one if you like the stories, and don't want to dig into the theories.
But if you like trying to place the manias, panics, and crashes on a common grid, to see their similarities, Kindleberger has written the book for you. In it he draws on a number of common factors:
* Loose monetary policy
* People chase the performance of the speculative asset
* Speculators make fixed commitments buying the speculative asset
* The speculative asset's price gets bid up to the point where it costs money to hold the positions
* A shock hits the system, a default occurs, or monetary policy starts contracting
* The system unwinds, and the price of the speculative asset falls leading to
* Insolvencies with those that borrowed to finance the assets
* A lender of last resort appears to end the cycle
I liked them both, but I am an economic history buff, and a bit of a wonk. The benefit of both books is that they will make you more aware of how financial crises come to be, and what the qualitative signs tend to manifest during the boom and bust phases of the overall speculation cycle.
Those who do not learn from history.... November 28, 2009
DAS (College Station, TX USA)
I highly recommend this book to anyone trying to make sense of the economic crashes of the past couple of years. "Devil Take the Hindmost" is a well written history of financial bubbles--how they develop and how they collapse. I wish I had read it two years ago.
Essential reading for all speculators...if you intend to succeed November 11, 2009
Tlo (Perth WA Australia)
I have been a client adviser in speculative/growth investments for 11 years and have recommended that all my clients purchase this book. Along with Peter Lynch's One Up on Wall Street, and my yet to be written second book I believe that these three are all you need to provide the platform for success in speculation. It is amazing how those tied up in textile, shipping and mining companies in the 1600's would not look at out of place in some of the bars/eateries in Perth. No doubt hairstyles would have changed but I can just imagine the rubbish flying back and forth way back then. This book illustrates clearly and with considerable passion how human stupidity is infinite and "Fear is temporary and greed is perpetual".
I could not imagine Australians willing to pay 1200x earnings for Qantas or Virgin Blue or insane amounts to join a rundown public golf course. It shows that bubbles can show up anywhere and although the great Nasdaq bubble came after the book was written the same rules apply. This book will help us prepare for the bubble in Australia considering we were the first to lift rates, and we had that Hey Hey Its Saturday skit which earnt the country considerable publicity.
When times get tough i.e when you should be buying stocks low this book brings it all together and I cannot recommend it strongly enough. No need for black boxes, flux capacitors or $5,000 seminar courses, this book nails it in an easy to read and enjoyable manner! Buy low, buy quality, buy lots and sell high it never changes!
Tony Locantro
Perth WA
Great history book October 10, 2009
Stephen Samperi (Houston, TX)
I really liked it. It went into pretty good detail on some major market bubbles. Mainly focuses on London and New York events. I learned a lot and it was pretty easy to read, except for some run on sentences. Im not sure if the author was trying to make it sound "old timey" but he spells words funny too....i dunno, but i read financial books all the time and this is one of the best ones that i have now.
Showing reviews 1-5 of 69
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