Promenent Moments of Financial Speculation Explained in Devil that the Hindmost: A History of Financial Speculation”

847 Words 4 Pages
Edward Chancellor is an investment strategist, amongst many other things after graduation from Trinity College. While he currently is a columnist for Financial Times, Chancellor has also written many books, one of them being “Devil that the Hindmost: A History of Financial Speculation”. This book is an interesting look at events where economic speculation is in the forefront throughout history. The book starts out with one of the first accounts of speculative mania, the tulopomania during the Dutch Golden Age. Chancellor has the interesting idea that the impulses have in fact shaped speculations, and they are at odds with the orthodox theory of markets who act in an efficient manner. Chancellor goes on to the topics of emerging markets, rogue traders, bull markets, and even the South Sea Bubble that occurred in the 1700s.
At the begging of the 1700s, the English government was in severe debt to the Bank of England. The Bank of England had a monopoly in the nation in return for managing the loans of the government however; the government was growing unhappy towards the bank. The national finances where not in good shape after many wars and bad business deals. In the book it states, “The directors of the South Sea company proposed to take over-or privatize-the British national debt, comprising various annuities, which it agreed to convert into its own shares” (62). Debt consolidation became necessary for the status of the nation, and all holders of the debt had to…