Devil Take the Hindmost: A History of Financial Speculation

Edward Chancellor

Read March-April 2005

This is a history of speculatory bubbles over the past four hundred years, mostly covering Western nations. Chancellor's book is a reasonably light volume, more anecdotal than analytical, not too heavy on the economics. He compensates with fairly extensive histories. For someone who himself worked in the financial industry, he seems to have a special loathing for speculators, and seems rather Keynesian.

This book has several strong attributes. For one thing, I hadn't previously appreciated the sophistication of early speculators, especially their ability to rapidly route around legislative obstacles. Chancellor also details well the influence of the Dutch, whose Golden Age gave them a head start, on the English financial markets. There is a clear, pedagogically good description of the confusing mess that was the South Sea bubble, leavened well with excerpts from the commentary of Daniel Defoe. (Who expected to see a literary hero in such a book? The increasing specialization of authors seems to have robbed us of such literate witnesses.) Chancellor also has a good ear for language, pointing out the origin of several common English phrases. When he does venture personal opinions, it's usually backed by solid fact, though he can't resist the occasional stab, as when (writing during the bubble of the late 1990s) he says of John Blunt of the South Sea Company, ``were he to return today, he would be hailed as a champion of `shareholder value''' (p. 91).

The book does suffer from being half-way between a popular and scholarly text, failing to quite be either; it's as if Chancellor's instinct was to write a more scholarly volume (the index is admirable), but his editor pushed him away from that precipice. What the editor failed to do, at any rate, was to curb the mind-boggling explosion of footnotes—virtually every page is peppered with them—that should have either been incorporated in the prose, turned into end-notes, or dropped entirely. It would be hard to find a book more intent on destroying a reader's train of thought.