Markets, Mobs, and Mayhem: A Modern Look at the Madness of Crowds - Hardcover

Robert Menschel

Hardcover

ISBN 10: 0471233277 ISBN 13: 9780471233275

Publisher: John Wiley & Sons Inc, 2002

Synopsis

In this fascinating tour through cultural, global, economic, and business history, icon of the financial world Robert Menschel explores the phenomenon of crowd psychology and its effects on business and culture. Explaining how crowd psychology creates market bubbles and irrational exuberance, Menschel mines world history—from the rise of the Nazis in Germany, to the fanatical love of brands, to the Dutch tulip craze of the seventeenth century, to America’s 1990s Internet bubble—to reveal how the behavior of crowds negatively affects the business world. Championing the causes of individuality and common sense, Markets, Mobs & Mayhem offers real wisdom for investors who want to keep their wits when everyone else is losing theirs.

About this title

From the Inside Flap:

"After heavy doses of 'irrational exuberance' and 'infectious greed,' I was happy to read such a witty and, at the same time, sensible and wise book written by someone with the unusual combination of a stylish pen and a great investment track record."
-Peter G. Peterson
Chairman, The Blackstone Group
former Secretary of Commerce
Chairman, Federal Reserve Bank of New York

A few years ago the Nasdaq was flying high and dot.com millionaires were a dime a dozen. The American economy appeared to be riding an endless wave of soaring stock prices and huge IPOs. Television's talking heads said that nothing like the tech boom had ever happened before and that there was no reason to think it would ever end.

In fact, it was only the latest version of an important story: group hysteria. Ever since 1630s Holland became the center of a massive explosion in tulip speculation, bubbles and busts have shaped history- economically, socially, and politically. Today, with the scope of the media and the ease of obtaining information, we are more at risk than ever. Elections are won or lost on hype alone; scandal can go global in a matter of seconds on the Internet. Keeping your head has never been harder.

In Markets, Mobs, and Mayhem, Robert Menschel chronicles some of the most memorable instances of mob thinking in history. He touches on the lynch mob and the Nazis, but his main focus is those well-meaning, intelligent folks who were simply swept up in a wave-fearful that their mail would be tainted by anthrax, or sure that the Nasdaq would never deflate. Bouyed by the crowd or the spreading rumor, we are later hard pressed to remember or rationalize our actions.

From Ponzi's scheme to the bursting of the Internet bubble, Menschel presents enlightening and often entertaining evidence of the danger inherent in surrendering one's position to the crowd. Most important, Markets, Mobs, and Mayhem offers expert advice on staying cool in the midst of panic-advice that works just as well in a Wall Street meltdown as it does in a theater on fire.

Whether you're a savvy investor looking to dodge the next crash, or just want to stoke your independent spirit, Markets, Mobs, and Mayhem is an insightful historical survey of the dark side of human nature.

From the Back Cover:

"It's easy to understand the excesses of the '90s by reading Bob Menschel's captivating, well-written history of the ways investors have been victimized by greed, folly, and chicanery. This is a fascinating chronicle of improbable manias that set off frenzied and thoughtless buying." --Arthur Levitt, former chairman, Securities and Exchange Commission

"This book's light-hearted, level-headed insights may be directed at the business world, but they ring equally true for government and public officials. Robert Menschel gives a valuable perspective on the power of the crowd." --Senator Charles E. Schumer

"This wonderfully witty and wise book by one of the most successful investors I've ever known is a must-read. He reminds us that trees do not grow in the sky and that if it looks too good to be true, it is." --John C. Whitehead, former chairman, Goldman Sachs & Co. and Chairman, Lower Manhattan Development Corp.

"This timeless anthology on the madness of crowds is chock-full of worldly wisdom, relevant anecdotes, and wonderful quotations, interlaced with the light touch of our finest cartoonists. Coming as it does in the aftermath of the great stock market bubble, Bob Menschel's fine book is also a useful reminder of what we all knew, deep down, but were afraid to admit: When the perception of stock prices loses its linkage to the reality of corporate values, a day of reckoning always follows." --John C. Bogle, founder and former CEO, The Vanguard Group

"This highly entertaining book is must reading for everyone without exception, regardless of age, wealth, or political persuasion. Menschel's delectable presentations expose the very roots of human behavior in a variety of fascinating situations, familiar and unfamiliar. Don't skim; read every word." --Peter Bernstein, author of The Power of Gold: The History of an Obsession and Against the Gods: The Remarkable Story of Risk

About this edition

• Publisher: John Wiley & Sons Inc
• Publication date: 2002
• ISBN 10: 0471233277
• ISBN 13: 9780471233275
• Binding: Hardcover
• Edition number: 1
• Number of pages: 226