A Short History of Financial Euphoria

John Kenneth Galbraith

Recommended By

Book Synopsis

"A Short History of Financial Euphoria" by John Kenneth Galbraith offers a concise exploration of the recurring pattern of financial bubbles throughout history. Galbraith, a renowned economist, delves into the irrational exuberance that propels these bubbles and the inevitable bursts that follow, leading to financial crises.

Through a historical lens, Galbraith analyzes notorious instances of financial euphoria, such as the Dutch Tulip mania in the 17th century, the Mississippi and South Sea bubbles of the 18th century, and the Roaring Twenties stock market boom. He highlights the common factors that contribute to these episodes, including speculative buying, excessive borrowing, and a collective faith in unfounded economic theories.

By examining the psychology behind financial booms and busts, Galbraith sheds light on the human tendency to be swayed by dreams of easy wealth and the disregard for caution when caught up in the frenzy. He explores the role of mass psychology and herd mentality in fueling these speculative episodes, along with the exploitation of human greed by unscrupulous promoters and financiers.

Galbraith argues that the cycle of financial euphoria and subsequent collapse is inherent in the nature of capitalism, as profits and returns on investments perpetuate the belief in further potential gains. His lucid analysis critiques the inadequate regulatory measures in place to prevent history from repeating itself and warns against the dangers of unchecked enthusiasm and speculative excess.

In this succinct yet insightful book, Galbraith offers an accessible examination of the inherent flaws in our financial systems, offering valuable lessons for investors, policymakers, and anyone interested in understanding the cyclical nature of financial markets throughout history.

Explore More Books

See All
The Hour Between Dog and Wolf
The Middle Kingdoms
Catch-22
Winning
Confessions of a Pricing Man
The Sixth Man
The Fourth Revolution
Ask The Dust
Frisco Kid
She Said
Secrets of Closing the Sale
The Bed of Procrustes
Chapterhouse: Dune
Fundamentals of Plasma Physics
The Almanack of Naval Ravikant
The Age of Surveillance Capitalism
The Devil’s Financial Dictionary
Rick and Morty Book Three
What If?
Keeping At It
Endure
Bel Canto
The Mind Doesn't Work That Way
Gold In The Grass
Dune
Mess
Poor Charlie's Almanack
Foundation and Earth
The Legend of Henry Ford
The Weather Makers
A Time for New Dreams
On Writing Well
The Nature of the Beast
Remote: Office Not Required
The Third Chimpanzee
The DevOps Handbook
Blackout
English Culture and the Decline of the Industrial Spirit, 1850-1980
Traction
The Magic of Thinking Big
Happy Money
The Mind of Napoleon
The Yoga Sutra of Patanjali
Breath From Salt
Cultural Strategy
Getting Real
Tribe of Mentors
Simple & Direct
The Psychedelic Explorer's Guide
Simple Rules
The Great Challenge
Tenth of December
Not Fade Away
Goethe’s Poems and Aphorisms
Thank You For Smoking
Mathematician's Delight
The Inner Lives of Markets
Maisy Mouse Collection
More Heat Than Light
The Healing Journey
Wild
Life 3.0
Discovering Your Personality Type
Of Wolves and Men
Scale
Warren Buffett
The Unbearable Lightness of Being
Devil's Harbor
The Utopia of Rules
The Power of Habit
Rich Dad's Cashflow Quadrant
The Sovereign Individual
Tools and Weapons
Competing in the Age of AI
How to Be Topp
The Warrior Ethos
Anything You Want
No Bullshit Guide to Math and Physics
The Female Brain
Adaptive Markets
Things Hidden Since the Foundation of the World
The Creative Act
The Charisma Myth
A Sense of Where You Are
The Order of Time
With the Old Breed
The Diversity Bonus
Welcome to Your Brain
Toussaint Louverture
Fallout
Tlon, Uqbar, Orbis Tertius
The Truth Machine
Good To Great
The War of Art
Technical Analysis of the Financial Markets
Plowman's Folly
Friday Forward
The Price of Tomorrow
The Art of Memoir
The Sleep Revolution