Every Man a Speculator

by Steve Fraser

Book Overview

Americans have experienced a love-hate relationship with Wall Street for two hundred years. Long an object of suspicion, fear, and even revulsion, the Street eventually came to be seen as an alluring pathway to wealth and freedom. Steve Fraser tells the story of this remarkable transformation in a brilliant, masterfully written narrative filled with colorful tales of confidence men and aristocrats, Napoleonic financiers and reckless adventurers,...

• Format: Paperback
• Language: English
• ISBN: 006662049X
• ISBN13: 9780066620497
• Release Date: February 2006
• Publisher: Harper Perennial
• Length: 768 Pages
• Weight: 5.85 lbs.
• Dimensions: 1.3" x 6.0" x 8.0"

Customer Reviews

Excellent History of Wall Street Most Notable for Its Exquisite Detail, Breadth and Coverage of Amer

Mr. Fraser has written a detailed and intimately researched tomb covering the history of Wall Street back to its earliest beginnings. This book is similar in theme to Manias, Panics, and Crashes: A History of Financial Crises (Wiley Investment Classics), Devil Take the Hindmost: A History of Financial Speculation, andExtraordinary Popular Delusions and the Madness of Crowds. Here is what distinguishes Mr. Fraser's book: - The focus on solely the American Experience, as opposed to including European. - The period of history covered is much greater than the others. Mr. Fraser begins with a great tale of Alexander Hamiton and Thomas Jefferson. I found this especially valuable and unique. - A broad focus. The author focuses not only on the financial, but on how Wall Street influenced the arts, popular culture, politics, et al. I recommend this book if you want a broad, in-depth history of Wall Street. It is the best I have found in covering the pre-1900 period of American finance. Because the book is a history, it compresses hundreds of years as you read it in a few hours. This allows one to see the boom/bust cycles of Wall Street with clinical detachment. If only we could apply this 20/20 vision to our own period of history!

4.5 stars-Shows that the central problem of economics is minimizing and reducing speculation

The author has done an excellent job showing the inevitable negative impacts that result from speculative behavior.He also shows that a fundamental error made by economists is to confuse enterprise and entrepreneurship with speculation.The idea that speculative behavior is entrepreneurial in nature is the basic error that lies at the heart of both the libertarian-Austrian school of economics(Ayn Rand,Murray Rothbard,Ludwig von Mises,etc.) and the University of Chicago economics approach(Milton Friedman, Robert Lucas,George Stigler,Gary Becker,etc.).This fallacious belief is then propounded by pseudo conservative Libertarian organizations ,like the Olin,Heritage, and Mellon Foundations ,and the American Enterprise Institute,to be an example of free enterprise.The foundation for these misbeliefs is called the Efficient Market Hypothesis(EMH).This hypothesis only holds when applied to consumption goods markets.There is not a shred of evidence,historical or statistical, that the EMH applies to investment markets or financial markets over time.The EMH is based on the empirically refuted claim that all of the time series data for price changes in financial markets can be modeled as being normally distributed.Benoit Mandelbrot demonstrated in the late 1950's that the financial market time series data is not even close to being approximately normally distributed.There has not been a single goodness of fit test provided by EMH adherents (Milton Friedman,Robert Lucas,Arthur Laffer,Eugene Fama)over the last 120 years that demonstrates normality.Empirical work overwhelmingly shows that the time series data is best modeled by the Cauchy Distribution.Friedman's Ptolomaic-like belief in the EMH explains his claims that all bubbles are rational(i.e.,there is no such thing as a speculative bubble)and the following assertion, quoted on p.540 by the author: "Speculation has come of age;it can sit quite comfortably side by side with investment;and it is as legitimate and necessary as the securities markets themselves ". This is an excellent demonstration of the confusion one finds in the economics profession concerning investment in long run,long lived,durable physical capital formation, aimed at producing goods/services for a possible future economic profit and short run ,banker financed, debt leveraged financial speculation aimed at extracting an economic profit without the production of any good or service.I have deducted 1/2 of a star from this book because the author ,unfortunately,has no discussion of the EMH in the book. The author does demonstrate that J M Keynes had correctly showed that the basic problem accounting for major downturns in economic behavior was speculation(pp.457-458).Keynes proved this on pp.304-306 of chapter 21 of his General Theory(1936).However,he overlooks the far,far more extensive demonstration made by Adam Smith, in his The Wealth of Nations(1776),that banker financed speculation will always lead to the waste and destruction o

matchless

A person can spend a lifetime attempting to understand the world of finance. Or he can read this book. It puts into perspective all the sludge oozing out of CNBC, Greenspan, Snow and Company, Kudlow and Cramer and, of course, the Mary Meekers who have begun to surface again after, I suppose, a four year vacation on a private island. For those of boundless faith and small capital, it provides a healthy dose of sanity. If you are victimized by excessive wealth and thus forced to protect it by what is called investment but amounts to speculation, read this one along with The Death of Money, by Kurtzman. In the world of limitless electronic money, the price of any asset is determined solely by crowd psychology. Every time it changes those numbers on the screen go up and down, and for people buying at the asked and selling at the bid it is a tough game. For those worried about the country as a whole, Fraser explains in language anyone can understand how enterprise has become a bubble on a tide of speculation, returning us to a condition not experienced in America since the Twenties. The same tired arguments for Wall Street hegemony which history exploded in the Thirties have been resurrected by the financial elite and their acolytes in the media and economics profession. Will history repeat itself? Recent crashes have been reversible by massive injections of fiat money. In the absence of political will it is hard to imagine alternative solutions.

Must read!

One of the best books you could possibly buy. Engrossing, interesting and a real epic work in my opinion. I am a professor of economics and this filled in a lot of missing pieces concerning economics, politics, culture, and history. Starts from the Revolution, and goes right to the present. I dog-eared many pages!

A Cultural Look at America's Wall Street Relationship

In July, 1849, the arrest of a local confidence man attracted national media attention. It seems the con artist, one William Thompson, genteelly dressed would approach his marks discreetly flashing a handful of cash. He would confide to the mark that he intended to invest the bundle in a sure fire business deal. He offered to invest the mark's cash in the same deal if he would demonstrate confidence in the deal by pleading his money and gold watch. Thompson promised to return the next day with the watch and even more cash. Of course, he never did. Throughout history, Americans have held ambivalent views of Wall Street. One moment they see it as one huge casino. The next, they see it as a cloister of scholarly seers who possess a mystical secret for instant success. Steve Fraser has written a Wall Street history that explores that dilemma's impact on the American psyche. Americans remain preoccupied with the sins and virtues of the financial markets. On one hand they remain committed to their ancestral values of hard work, play, equality, well-being and national purpose. Yet, they are still magnetically drawn to promises of instant wealth and success. This well-written, thoroughly researched history explores this chronic tension. Through the colorful tales of confidence men and aristocrats, he offers the reader unique insights into our collective view of American Capitalism and its changing culture.