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darwin8u's review
5.0
It is wise to enjoy that which is possible without hoping for the continuance of a favorable conjecture and the persistence of good luck."
- Joseph de la Vega, Confusión de Confusiones.
I work in finance and read a lot. Most people assume I read a bunch of business and finance books. Not really. Often, I think you learn more about leadership from history and more about people from poetry and fiction that you can ever find in a business or leadership book. But I've always wanted to read these two pieces. Bernard Baruch was a huge fan of Mackay's "Extraordinary Popular Delusions and the Madness of Crowds" and both books seemed too damn perfect for this Bitcoin, market volatility moment.
Without giving away the game, this book is actually two major pieces and a fantastic introduction:
1. Introduction to both works, with historical background, by Martin S. Fridson (probably one of the best known analysts in the high yield world). Fridson puts both books into historical and financial perspective and introduces both authors.
1. Introduction to both works, with historical background, by Martin S. Fridson (probably one of the best known analysts in the high yield world). Fridson puts both books into historical and financial perspective and introduces both authors.
2. [b:Extraordinary Popular Delusions and the Madness of Crowds|162120|Extraordinary Popular Delusions and the Madness of Crowds|Charles Mackay|https://images.gr-assets.com/books/1328696270s/162120.jpg|1033191] (1841) by Charles Mackay is divided up into three case-studies:
i. The Mississippi Scheme/John Law (1716-1720): Dealing with France during the era between Louis XIV and Louis XV (Duke of Orleans as regent) and Law's involvement in both paper money AND the French enthusiasm for the Mississippi Scheme. It details the rise and fall of both Law and how this financial disaster almost destroyed France (one could argue that it was a big contributor to the French Revolution).
ii. The South Sea Bubble/Harley Earl of Oxford (1720): Deals with a similar bubble as the Mississippi Scheme, but was handled a bit differently and ended a bit neater. But again, Mackay details the same factors driving the stock prices up, and what eventually lead to the collapse of prices.
iii. Tulipomania : Holland's experience with the Tulip bubble (1636-1637). Primarily in the Netherlands, but also to a lesser degree in England. Mackay details the mania and its spread, as well as the implications (legal and social) after its collapse.
3. [b:Confusión de confusiones|18044042|Confusión de confusiones|José de la Vega|https://images.gr-assets.com/books/1370550645s/18044042.jpg|25321539](1688) by Joseph de la Vega is a book, written originally in Spanish by a Portuguese Jew, published in Amsterdam. Like Mackay, De la Vega is at heart a poet, so the book contains Biblical allusions, mythology, etc., but focuses on the Amsterdam stock exchange, and looks primarily at the trading of shares of the East and West India Companies. It is amazing (AMAZING) to think that within a decade of the Dutch East India company being created, markets had already developed that would not just buy and sell shares, but options, futures, calls, puts. The market in the 1600s in Holland doesn't feel too different than the NY Stock Exchange or NASDAQ of today.
It is hard to pick a favorite between these two. Both men had financial brains but the hearts of poets. I loved them. De la Vega sees more method in the madness of the markets, while MacKay sees the mass hysteria as the cause of crazy markets. Both men are probably correct to degrees. Both men are hugely influential in the way we think about the market, risk, speculation, and people. Just like I'd recommend poetry to financial analysts, but I'd recommend these financial books to poets. No one will be disappointed.
- Joseph de la Vega, Confusión de Confusiones.
I work in finance and read a lot. Most people assume I read a bunch of business and finance books. Not really. Often, I think you learn more about leadership from history and more about people from poetry and fiction that you can ever find in a business or leadership book. But I've always wanted to read these two pieces. Bernard Baruch was a huge fan of Mackay's "Extraordinary Popular Delusions and the Madness of Crowds" and both books seemed too damn perfect for this Bitcoin, market volatility moment.
Without giving away the game, this book is actually two major pieces and a fantastic introduction:
1. Introduction to both works, with historical background, by Martin S. Fridson (probably one of the best known analysts in the high yield world). Fridson puts both books into historical and financial perspective and introduces both authors.
1. Introduction to both works, with historical background, by Martin S. Fridson (probably one of the best known analysts in the high yield world). Fridson puts both books into historical and financial perspective and introduces both authors.
2. [b:Extraordinary Popular Delusions and the Madness of Crowds|162120|Extraordinary Popular Delusions and the Madness of Crowds|Charles Mackay|https://images.gr-assets.com/books/1328696270s/162120.jpg|1033191] (1841) by Charles Mackay is divided up into three case-studies:
i. The Mississippi Scheme/John Law (1716-1720): Dealing with France during the era between Louis XIV and Louis XV (Duke of Orleans as regent) and Law's involvement in both paper money AND the French enthusiasm for the Mississippi Scheme. It details the rise and fall of both Law and how this financial disaster almost destroyed France (one could argue that it was a big contributor to the French Revolution).
ii. The South Sea Bubble/Harley Earl of Oxford (1720): Deals with a similar bubble as the Mississippi Scheme, but was handled a bit differently and ended a bit neater. But again, Mackay details the same factors driving the stock prices up, and what eventually lead to the collapse of prices.
iii. Tulipomania : Holland's experience with the Tulip bubble (1636-1637). Primarily in the Netherlands, but also to a lesser degree in England. Mackay details the mania and its spread, as well as the implications (legal and social) after its collapse.
3. [b:Confusión de confusiones|18044042|Confusión de confusiones|José de la Vega|https://images.gr-assets.com/books/1370550645s/18044042.jpg|25321539](1688) by Joseph de la Vega is a book, written originally in Spanish by a Portuguese Jew, published in Amsterdam. Like Mackay, De la Vega is at heart a poet, so the book contains Biblical allusions, mythology, etc., but focuses on the Amsterdam stock exchange, and looks primarily at the trading of shares of the East and West India Companies. It is amazing (AMAZING) to think that within a decade of the Dutch East India company being created, markets had already developed that would not just buy and sell shares, but options, futures, calls, puts. The market in the 1600s in Holland doesn't feel too different than the NY Stock Exchange or NASDAQ of today.
It is hard to pick a favorite between these two. Both men had financial brains but the hearts of poets. I loved them. De la Vega sees more method in the madness of the markets, while MacKay sees the mass hysteria as the cause of crazy markets. Both men are probably correct to degrees. Both men are hugely influential in the way we think about the market, risk, speculation, and people. Just like I'd recommend poetry to financial analysts, but I'd recommend these financial books to poets. No one will be disappointed.
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