Manias, Panics, and Crashes, Fifth Edition is an engaging and entertaining account of the way that mismanagement of money and credit has led to financial explosions over the centuries. Covering such topics as the history and anatomy of crises, speculative manias, and the lender of last resort, this book puts the turbulence of the financial world in perspective. The updated fifth edition expands upon each chapter, and includes two new chapters focusing on significant financial crises of the last fifteen years.
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Book Description
Editorial Reviews
Review
One of Fortune Magazine's best books on investing 2010
'Charles Kindleberger has written, with great polish and style, an analysis of the stages of financial crises over the last two and a half centuries.' - Patrick Minford, Economic Journal
'Manias, Panics and Crashes is a scholarly account for the way that mismanagement of money and credit has led to financial explosions over the centuries.' - Richard Lambert, Financial Times
'Professor Kindleberger has the welcome gifts of carrying lightly an immense weight of learning and of always using his imagination in deciding how to deploy it. These gifts are as evident as ever in his latest book.' - W.Ashworth, Economic History Review
'Underneath the hilarious anecdotes, the elegant epigrams, and the graceful turns of phrase, Kindleberger is deadly serious. The manner in which humans beings earn their livings is no laughing matter to him, especially when they attempt to do so at the expense of one another. As he so effectively demonstrates, manias, panics, and crashes are the consequence of an economic environment that cultivates cupidity, chicanery, and rapaciousness rather than a devout belief in the Golden Rule.' - Peter L. Bernstein
'Robert Aliber has produced superb update of the classic book by Charles Kindleberger which remains as relevant as ever.' - Martin Wolf, Financial Times
'...if what you're after is a comprehensive guide to financial crises since the dawn of the modern era, buy Charles Kindleberger's Manias, Panics and Crashes...an excellent read.' - Edmund Conway, Telegraph.co.uk
--This text refers to an out of print or unavailable edition of this title.
'Charles Kindleberger has written, with great polish and style, an analysis of the stages of financial crises over the last two and a half centuries.' - Patrick Minford, Economic Journal
'Manias, Panics and Crashes is a scholarly account for the way that mismanagement of money and credit has led to financial explosions over the centuries.' - Richard Lambert, Financial Times
'Professor Kindleberger has the welcome gifts of carrying lightly an immense weight of learning and of always using his imagination in deciding how to deploy it. These gifts are as evident as ever in his latest book.' - W.Ashworth, Economic History Review
'Underneath the hilarious anecdotes, the elegant epigrams, and the graceful turns of phrase, Kindleberger is deadly serious. The manner in which humans beings earn their livings is no laughing matter to him, especially when they attempt to do so at the expense of one another. As he so effectively demonstrates, manias, panics, and crashes are the consequence of an economic environment that cultivates cupidity, chicanery, and rapaciousness rather than a devout belief in the Golden Rule.' - Peter L. Bernstein
'Robert Aliber has produced superb update of the classic book by Charles Kindleberger which remains as relevant as ever.' - Martin Wolf, Financial Times
'...if what you're after is a comprehensive guide to financial crises since the dawn of the modern era, buy Charles Kindleberger's Manias, Panics and Crashes...an excellent read.' - Edmund Conway, Telegraph.co.uk
From the Back Cover
Finance
"Underneath the hilarious anecdotes, the elegant epigrams, and the graceful turns of phrase, Kindleberger is deadly serious. The manner in which human beings earn their livings is no laughing matter to him, especially when they attempt to do so at the expense of one another. As he so effectively demonstrates, manias, panics, and crashes are the consequence of an economic environment that cultivates cupidity, chicanery, and rapaciousness rather than a devout belief in the Golden Rule."
—from the Foreword to the Fourth Edition by Peter L. Bernstein,
author of Against the Gods and The Power of Gold
Praise for previous editions of Manias, Panics, and Crashes
"Classic...Manias, Panics, and Crashes is a durable guide to meditation: wise, witty, and practical. It is a template against which to measure the latest financial crisis—whatever and whenever that happens to be."
—David Warsh, The Boston Globe
"Definitive."
—Floyd Norris, The New York Times
"[Manias, Panics, and Crashes] is a scholarly account of the way that mismanagement of money and credit has led to financial explosions over the centuries."
—Richard Lambert, Financial Times
"What long has been the best history of financial pathologies is now even better. The reader who absorbs Kindleberger's lessons will be prepared to foresee and navigate the financial crises that surely lie ahead. Like a true classic, Manias, Panics, and Crashes is both timely and timeless."
—Richard Sylla, Kaufman Professor of Financial History
Stern School of Business, New York University
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Customer Reviews
Most Helpful Customer Reviews
44 of 45 people found the following review helpful
Format:Paperback|Amazon Verified Purchase
History always has lessons to teach us. In addition to comments by Golden Lion from Utah, I believed this book really spoke poignantly about the "adjustment process" of global or local market imbalances and the possible causes.
The causes are elaborated in many different examples from the Dutch Tulip crash to the dot-com crash. Signs of the excess liquidity, overly generous expectations of future demand, and other general characteristics are drawn from these events.
In the economic case where A has caused B, then B has caused C, and so on. If Z is a market crash, one cannot blame Y for losses. The book writes that its the cumulative effects of A-Y that has caused this, and more likely the pin-prick that pops a "bubble" is normally from a totally unexcepted source. To me, this was the greatest take away point -- naturally after every market crash we attempt to learn from our follies. However, the market has also learned and adapted, such that the next market failure is caused by a different set, but the same symptoms are similar to A-Y.
On the negative side, I wished that the latest version did a little better job at editing down the redundancies. For example, the Japanese real estate collapse in the early 1990's was used 5-7 times in different parts of the book -- in many cases, the underlying story was retold, even verbatim. I would disagree with one of the reviewers, that one needs an advanced degree to understand this book, however, an appreciation for economic theory is helpful, particularly monetary policies and capital markets. It does not require up-to-date knowledge of the stock, currencies, or bond markets.
Nevertheless, a good book to keep and re-read every few years. Always worth remembering our past mistakes and trying to create an edge.
The causes are elaborated in many different examples from the Dutch Tulip crash to the dot-com crash. Signs of the excess liquidity, overly generous expectations of future demand, and other general characteristics are drawn from these events.
In the economic case where A has caused B, then B has caused C, and so on. If Z is a market crash, one cannot blame Y for losses. The book writes that its the cumulative effects of A-Y that has caused this, and more likely the pin-prick that pops a "bubble" is normally from a totally unexcepted source. To me, this was the greatest take away point -- naturally after every market crash we attempt to learn from our follies. However, the market has also learned and adapted, such that the next market failure is caused by a different set, but the same symptoms are similar to A-Y.
On the negative side, I wished that the latest version did a little better job at editing down the redundancies. For example, the Japanese real estate collapse in the early 1990's was used 5-7 times in different parts of the book -- in many cases, the underlying story was retold, even verbatim. I would disagree with one of the reviewers, that one needs an advanced degree to understand this book, however, an appreciation for economic theory is helpful, particularly monetary policies and capital markets. It does not require up-to-date knowledge of the stock, currencies, or bond markets.
Nevertheless, a good book to keep and re-read every few years. Always worth remembering our past mistakes and trying to create an edge.
58 of 62 people found the following review helpful
Format:Paperback|Amazon Verified Purchase
I am no economist and just an interested general reader. I expected to read narratives about past financial crises and how they played out. But this book is not organized that way. It doesn't tell any story from start to finish. Instead it references lots of different crises in a kind of shorthand way, without giving the background or the overall narrative.
Many of the references are pretty darn obscure, at least to me. So fine, if he's talking about how a certain phenomenon works and he says, "as in 1932," or "as in the S&L crisis," I'm with him. But when he says, "just as in the 1762 case in Belgium" (made up example)--well, my eyes start to glaze over, because he hasn't told me the story of 1762 Belgium, but referenced it as if it should be as familiar to me as the Great Depression in the US.
I also think there's something wrong with the writing style. He seems not to start out with topic sentences that show us where he's going, or to end with a summing up of the significance of what he's just said. Certain details recur within a few pages of each other. The effect is pretty scatter-shot, as if it was not carefully edited and made to flow.
There is plenty of raw material here for anyone watching our current economic crisis and wondering how it happened, but you have to work for it. What I get from it is that in certain circumstances, if everyone does what seems best to him or her in the market, the end result will be disaster for all. It's not really irrational to buy when prices are increasing by the day, because huge profits can indeed be made. But the more people that make that individually rational choice, the more irrational the whole thing becomes.
Maybe I could compare it to a stampede to an exit door in a fire. Each person's individual best choice is to get out as quickly as possible. But if you allow that psychological reality to play out, you might have people trampled to death at the door who then block everyone else from escaping.
Reading this was like listening to a rather elderly professor of history who is intimately familiar with many obscure incidents, but doesn't provide the context for his young students to follow his train of thought.
Many of the references are pretty darn obscure, at least to me. So fine, if he's talking about how a certain phenomenon works and he says, "as in 1932," or "as in the S&L crisis," I'm with him. But when he says, "just as in the 1762 case in Belgium" (made up example)--well, my eyes start to glaze over, because he hasn't told me the story of 1762 Belgium, but referenced it as if it should be as familiar to me as the Great Depression in the US.
I also think there's something wrong with the writing style. He seems not to start out with topic sentences that show us where he's going, or to end with a summing up of the significance of what he's just said. Certain details recur within a few pages of each other. The effect is pretty scatter-shot, as if it was not carefully edited and made to flow.
There is plenty of raw material here for anyone watching our current economic crisis and wondering how it happened, but you have to work for it. What I get from it is that in certain circumstances, if everyone does what seems best to him or her in the market, the end result will be disaster for all. It's not really irrational to buy when prices are increasing by the day, because huge profits can indeed be made. But the more people that make that individually rational choice, the more irrational the whole thing becomes.
Maybe I could compare it to a stampede to an exit door in a fire. Each person's individual best choice is to get out as quickly as possible. But if you allow that psychological reality to play out, you might have people trampled to death at the door who then block everyone else from escaping.
Reading this was like listening to a rather elderly professor of history who is intimately familiar with many obscure incidents, but doesn't provide the context for his young students to follow his train of thought.
25 of 27 people found the following review helpful
5.0 out of 5 stars
A classic book on financial bubbles from an exceptional scholar
September 30, 2007
Format:Paperback|Amazon Verified Purchase
Kindleberger was a professor of economics at MIT, and a deep scholar of the history of financial bubbles and subsequent crashes. He proves with many examples that growth in the supply of credit is a fundamental factor in bubble development, stengthening associations of this type categorized by Hyman Minsky. While Kindleberger's writing is sometimes redundant, his amazing grasp of the details of financial history, numerous examples, and deep understanding more than compensate for this minor limitation of style. This book has been through 5 editions and is an indispensable reference; it is also a fascinating read. It should not to be missed by any serious investor, nor any student of financial manias and panics.
Most Recent Customer Reviews
4.0 out of 5 stars
Lots of information, but tough writing style.
The book was very informative about how different bubbles have developed over history. It accounts for all the big bubbles up to that point in time. Read more
Published 2 days ago by Nicholas Roberts
5.0 out of 5 stars
Very good for detailing individual crashes
Very good. Should be read together with This time is different and Fault lines to get bigger picture. Read more
Published 12 months ago by JH
4.0 out of 5 stars
Informative but Remote
Ed, and Evelyn's reviews state the case that this text is obscure, and poorly organized. Notwithstanding their valid complaints about the author's prose, and the organization of... Read more
Published 23 months ago by NetPurchaseMan
3.0 out of 5 stars
Lots of examples
I did not mind this book because it gave me a good idea about different and important financial events, but there did not seem to be that much depth to this book. Read more
Published on April 3, 2011 by PhilDunfy
4.0 out of 5 stars
Good book but not an easy read
Prof.Kindleberger's book is very topical to read at any time in the past or future. Newcomers to stock investing like me have been looking at the boom of the late 1990s, the crash... Read more
Published on November 3, 2010 by Raghu Nathan
5.0 out of 5 stars
Manias, Panics and Crashes
I wish a lot of people here in the USA would read this book to learn about the cyclicality of financial markets thus they may understand where we are in the economy right now and... Read more
Published on August 21, 2010 by Margaret M. Obermeyer
4.0 out of 5 stars
A delighful and amusing book on a miserable and depressing subject
Manias, Panics and Crashes is delightful book--funny, surprising, and entertaining. Charles P. Kindleberger has a great sense of humor, an open and inquiring mind, and is deadly... Read more
Published on August 5, 2010 by Draca610
3.0 out of 5 stars
Uneven and hard to read, not for the general public.
The foreword by Robert Solow warns you: "It was CPK's style as an economic historian to hunt for interesting things to learn, not to pursue a systematic agenda. Read more
Published on April 28, 2010 by Individual Investor
2.0 out of 5 stars
Dry, disjointed ramble through economic history
I saw this book referenced so much that I thought I would give it a try. In addition, I believe the past is usually a good indication of what's to come, given the same or similar... Read more
Published on March 19, 2010 by Glenn Corey
5.0 out of 5 stars
Great Qualitative Explanation of Business Cycles
Kindleberger does an excellent job at explaining the history of Western "Manias, Panics, and Crashes". Read more
Published on January 26, 2010 by Rufus Burgess
Citations (learn more)
This book cites 100
books:
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100
books
cite this book:
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- South Sea Bubble by John Carswell on 13 pages
- Financial Crises (MSH: Colloques) by Kindleberger on 7 pages
- on 7 pages
- Gold and Iron by Fritz Stern on 7 pages
- House of All Nations by Christina Stead on 5 pages
See all 100 books this book cites
- From Dickens to Dracula: Gothic, Economics, and Victorian Fiction (Cambridge Studies in Nineteenth-Century Literature and Culture) by Gail Turley Houston in Back Matter (1), Back Matter (2), and Back Matter (3)
- The Power of Unfair Advantage: How to Create It, Build it, and Use It to Maximum Effect by John L. Nesheim on page 218, Back Matter (1), and Back Matter (2)
- The Bank Credit Analysis Handbook: A Guide for Analysts, Bankers and Investors by Jonathan Golin on page 172, page 173, and Back Matter
- The Rise of Fiduciary Capitalism: How Institutional Investors Can Make Corporate America More Democratic by James P. Hawley in Back Matter (1), and Back Matter (2)
- Currency Risk in Investment Portfolios by Bruno Solnik on page 97, and Back Matter
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