Investing 1.0—Blind Faith and Speculation

Gary Smith () and Margaret Smith ()
Additional contact information
Gary Smith: Pomona College

Chapter Chapter 1 in The Power of Modern Value Investing, 2023, pp 1-16 from Springer

Abstract: Abstract The early days of stock investing were characterized by little more than speculative guesses about whether stock prices were about to go up or go down—a fertile field for bubbles, including the South Sea Bubble, Tulipmania, the British Bicycle Bubble, and the Roaring Twenties. The enthusiastic purchase of dubious investments is encouraged by the Greater Fool Theory: “Buy something at an inflated price with the hope that you can sell it to an even bigger fool at an even higher price.” A focus on predicting short-term price movements also encourages Ponzi schemes and market manipulation such as the “Radio Pool” in the 1920s that pumped and dumped RCA stock.

Date: 2023
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-031-45900-9_1

Ordering information: This item can be ordered from
http://www.springer.com/9783031459009

DOI: 10.1007/978-3-031-45900-9_1

Access Statistics for this chapter

More chapters in Springer Books from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().