Must Reading: ‘Short History of Financial Euphoria’
I’m not sure when he wrote the first edition of his A Short History of Financial Euphoria, but the late economist John Kenneth Galbraith updated it in 1990 following the stock market crash of 1987 and then the savings and loan meltdown of the late 1980s. Those times seem tame compared to what’s transpiring now. Unfortunately, Mr. Galbraith is no longer around to blame our all current problems on Republicans, as he does in this book. (At least in his The Great Crash 1929, he finds plenty of blame to spread around, including to the Federal Reserve.)
I call this book, which is really only a hundred or so pages long and can be read in an hour, must reading because it confirms what should be obvious: Crashes develop because of greed and speculation. What may not be obvious–in fact, I know it’s not that obvious to the general publi–is that greed and speculation arise only after the government fans the flames of, well, greed and speculation by…